PAL HOLDINGS, Inc. swung to a P7.3 billion net loss attributable to parent in 2017 from a P4.13 billion profit in the year prior, as higher fuel prices and ballooning aircraft and passenger expenses weighed on the bottom line.
In a regulatory filing, the parent company of Philippine Airlines said consolidated revenues rose 13.2% to P129.51 billion last year.
“The increase in revenues was attributable mainly to higher passenger revenues brought about by the growth in volume of passengers carried and number of flights mounted. During the year, new international points and city pairs were introduced,” PAL Holdings said.
In 2017, PAL introduced new flights between Clark and Seoul, Cebu and Chengdu, Kalibo and Chengdu, Kalibo and Guangzhou and Cebu and Bangkok, and launched daily service to Kuala Lumpur. For domestic flights, PAL introduced routes from Clark Airport in Pampanga, Cebu, and Davao. PAL carried 14.5 million passengers against 13.4 million in 2016.
However, the company’s consolidated expenses grew by 26.7% to P136 billion for the year ending December 31, 2017, from P107.3 billion during the same period in 2016.
“The main drivers for the growth are attributable to flying operations expenses, maintenance, passenger service, aircraft and traffic servicing, and reservation and sales,” PAL said.
Expenses from flying operations went up 31.7% to P67.3 billion in 2017, with the jet fuel costs accounting for more than half or P37.7 billion. PAL said jet fuel prices rose from an average of $75.59 per barrel for 2017 from $67.57 per barrel in 2016.
Maintenance expenses rose 23.5% to P15.7 billion, due to “higher aircraft, engine and component repair and maintenance costs incurred during the current period as a result of the additional aircraft deliveries and increase in utilization.”
Costs related to passenger services jumped 22% to P12.6 billion for 2017, as PAL saw an 8.3% increase in passenger traffic and 3.2% rise in number of flights operated. — PPCM

A SUBSIDIARY of Integrated Micro-Electronics, Inc. (IMI) has partnered with one of the largest printing firms in Japan for the development of “game-changing” touch sensors.
In a disclosure to the stock exchange on Tuesday, the Ayala-led manufacturer said subsidiary VIA optronics GmbH have formed a new joint venture company with Toppan Printing Co. Ltd.
Under the deal, 65% of the shares of Toppan Touch Panel Products Co. Ltd., a newly formed spin off company, will be transferred to VIA. The joint venture firm will be VTS-Touchsensor Co. Ltd.
VTS will develop and manufacture the metal mesh touch sensors in Japan within the existing facilities of Toppan, while leveraging VIA optronics’ knowledge and experience of market requirements, system-level design, and production in the automotive, consumer and industrial markets to support further development of the core sensor technology.
“Using the experience of both companies, VTS will provide game-changing metal mesh touch sensors to their existing and future customer base,” VIA optronics CEO Juergen Eichner was quoted in a statement as saying.
“The new setup will also strengthen VIA’s portfolio of differentiated and value-added sensor technology for touch panels, touch display modules, display head assemblies and interactive display systems across multiple markets and segments.”
The two companies pledged to grow the business in all market segments, expand the touch sensor production line capacity of VTS and continuously develop the technology itself.
VIA optronics is a leading supplier of interactive display solutions with core competencies in optical bonding for sunlight readability and robustness as well as high performing touch display modules.
The company serves multiple touch-display applications in consumer electronics, automotive and industrial markets.
IMI acquired a 76% stake in VIA optronics in 2016 for €47.8 million (around P2.56 billion).
New acquisitions and the expansion of its automotive and industrial business pushed IMI’s earnings by more than a fifth to $34.44 million last year from $28.02 million in 2016.
IMI shares slipped 20 centavos or 1.16% to end at P17 each on Tuesday. — Krista Angela M. Montealegre

SAN MIGUEL Corp., the Philippines’ largest company, expects to raise as much as $3.6-billion selling shares of its merged food and drinks unit in the fourth quarter in what could be the country’s biggest share sale on record.
San Miguel Food and Beverage, Inc., which combined three businesses of the group, is now worth $12 billion, President Ramon Ang told reporters at a meeting in Manila on Tuesday. Selling a 30% stake may raise as much as $3.6 billion, while a 20% slice would generate about $2.4 billion, he said.
Investors have welcomed Mr. Ang’s consolidation of the group’s food and beverage business, helping push the parent’s shares up 21% in 2017 and another 27% so far this year. The merger makes it easier to make bets on growth in the company’s more than a century-old beer business or on the oil, energy and infrastructure businesses that have helped increase sales by more than five times over the past decade.
“Old businesses are usually forgotten during diversification, but that didn’t happen in our case,” Mr. Ang said in Mandaluyong City, Philippines. “We continue to grow and remain bullish on this sector.”
The group’s recurring profit may reach between P65 billion ($1.3 billion) and P70 billion this year from about P55 billion in 2017, with oil unit Petron Corp. and its merged food and drinks business accounting for the bulk, Mr. Ang said.
Mr. Ang is counting on Philippine economic growth that has topped 6% annually in the past six years to help boost sales and fuel San Miguel’s expansion into heavy industries. Projects include an airport that could complement the capital’s 70-year-old facility, which has been ranked among the world’s worst as it handles well beyond the 30 million passengers it was intended to serve.
The company’s P736-billion airport proposal is up for final review by President Rodrigo R. Duterte and his cabinet. The facility could be completed five years from final approval, Mr. Ang said.
Petron Corp., the nation’s largest oil company, will likely see profit rise to least P18 billion this year from P14.1 billion in 2017 as its refinery runs on its full 180,000-barrel-per-day capacity. The company plans to expand by 90,000 barrels per day, which may cost at least $5 billion, Ang said. — Bloomberg

THE Office of the City Prosecutor in Mandaluyong has junked Philodrill Corp.’s bid to revive the case for attempted estafa it filed against its former president Francisco A. Navarro.
On Tuesday, Philodrill told the stock exchange it received a copy of the resolution penned by Senior State Prosecutor Arnold L. Magpantay of the   Office of the City Prosecutor, Mandaluyong City, denying the company’s motion for reconsideration on the case’s dismissal due to lack of merit.
The development followed the prosecutor’s recommendation earlier this year for the dismissal of the case for lack of probable cause. Mr. Magpantay penned the previous resolution, which Philodrill received on Jan. 5.
Philodrill and Reynaldo E. Nazarea, its treasurer, vice-president for administration and director, filed the complaint against Mr. Navarro on Sept. 15, 2017 for violation of the Revised Penal Code, Article 315 (1)(a), for attempted estafa.
The complainants said they had filed the case when Mr. Navarro demanded payment of his supposed “special retirement package,” coupled with a threat that cases will be filed against the company if his demands were not complied with.
“The NLRC (National Labor Relation Commission), through Labor Arbiter Hernandez already ruled that the claim of Mr. Navarro has no basis. As such, Mr. Navarro was acting under false pretenses,” Philodrill said in its description of the legal proceeding.
On Feb. 1, Philodrill said the decision of the labor arbiter had been reversed and set aside by the Fourth Division of the NLRC after an appeal filed by Mr. Navarro.
A new decision ordered Philodrill to pay the complainant special retirement pay amounting to P17.839 million. Mr. Navarro had claimed special retirement benefits amounting to P19.893 million, profit share of around P1.392 million and litigation expenses of at least P2.128 million. He had also claimed moral and exemplary damages amounting to P20 million.
Philodrill believes these claims are without basis, as Mr. Navarro has been paid his full retirement benefits in accordance with the company’s approved retirement plan. It also said he had executed a quit-claim document.
On Feb. 8, Philodrill said it had filed a motion for reconsideration on the decision of NLRC’s Fourth Division. — Victor V. Saulon

Here’s a quick glance at how PSEi stocks fared on Tuesday, April 10, 2018.