CEBU AIR, INC. swung to a net loss in the second quarter of 2020, hit by the ongoing coronavirus pandemic.
The listed operator of budget carrier Cebu Pacific on Wednesday reported a net loss of P7.96 billion for the quarter, reversing a profit of P3.79 billion in the same period last year.
The government-imposed travel restrictions during the period resulted in a nearly 93% decline in the company’s gross revenues to P1.42 billion from P23.53 billion in the year-earlier period.
Without indicating the details for the second quarter, the company said it had seen a 60.1% decline in passenger traffic from 11.2 million to 4.5 million in the first semester, as the number of flights was lower by 55.6%. There was also a 7.3-percentage point decrease in seat load factor from 87.2% to 80.8%, it added.
Total expenses for the second quarter also dropped 58.5% to P7.71 billion from last year’s P18.56 billion.
To recall, the carrier, in the first quarter, recorded a 24.9% decline in revenues to P15.91 billion from P21.18 billion in the same period last year. The company posted a net profit of P3.36 billion in the same period last year.
The coronavirus pandemic had triggered cancellation of flights to China, Hong Kong, Macau and South Korea “in varying periods due to the imposition of travel restrictions,” the listed company noted.
“With the rapid escalation of the situation surrounding coronavirus disease 2019 (COVID-19), the Philippine government implemented a community quarantine which then prompted the group to suspend all its scheduled flights beginning March 19, 2020. While some sporadic arrangements for sweeper flights to assist stranded tourists did occur, for the most part, the group’s operations were virtually nil until April when some cargo flights within the Philippines and eventually to countries like Japan, Thailand, China, Hong Kong recommenced,” it added.
The airline’s commercial passenger operations resumed on June 3, starting with limited-capacity domestic flights.
Still, the company described its consolidated balance sheet as “strong” as of June 30.
“As of June 30, except as otherwise disclosed in the financial statements and to the best of the group’s knowledge and belief, there are no events that will trigger direct or contingent financial obligation that is material to the group, including any default or acceleration of an obligation,” it added.
On Wednesday, shares in the company rose 5.53% to close at P41 each. — Arjay L. Balinbin