PAL allocates $650 million for capex

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FLAG CARRIER Philippine Airlines (PAL) is allocating around $650 million for capital expenditures this year, as it plans to purchase six aircraft.

“More or less $650 million,” PAL President and Chief Operating Officer Jaime J. Bautista said when asked about the company’s capex for 2019. In 2018, PAL allocated $2 billion in capex to acquire 15 aircraft.

Mr. Bautista said the company is taking delivery of six new aircraft this year.

“Two Airbus 350, the one that already arrived last week, the next one will be in April. That will complete our order for Airbus 350. And then two more Airbus 321neo… The other two in the third quarter this year, A321ceo,” he said.

He noted the long-haul A321neo can be used to fly to Sydney, Sapporo, and Port Moresby.

Mr. Bautista said PAL intends to retire some of its aircraft, which are currently used as back-up in case the regular planes have technical difficulties.

“We will also retire (nine) Bomardier Q400,” he said. “We have 10 brand-new Q400 Generation and there are instances that there are technical problems. We’re using these [old] airplanes only as back up…We use these only if there are no options but we’re planning to sell these also and there are interested buyers,” he said.

Last month, ANA Holdings, Inc., parent of Japan’s biggest airline All Nippon Airways, acquired a minority stake in PAL Holdings, Inc. for $95 million (around P5 billion).

For the first nine months of 2018, PAL Holdings reduced its attributable net loss by 8% to P3.921 billion from P4.263 billion in the same period last year.

While its nine-month revenues rose 16% at P112.07 billion, PAL saw its expenses jump 17% to P115.30 billion due to higher jet fuel prices. — RJNI