PAL further bleeds as last year’s losses more than double to P10B

THE listed operator of flag carrier Philippine Airlines reported a net loss of P10.31 billion last year, more than double the attributable losses to equity holders recorded a year earlier.

In a regulatory filing, PAL Holdings, Inc. placed revenues in 2019 at P154.54 billion, higher by 2.7% than the previous year’s, but expenses and other charges piled up.

PAL said financing charges had increased by P6.76 billion or 128.4%, mainly after it adopted the new lease accounting standard, or PFRS 16, and chalked up additional aircraft financing.

“There were also more charges incurred during the year and significantly less one-off gains compared to 2018 where it booked income from reversal of provision for contingency for the Flight Attendants and Stewards Association of the Philippines (FASAP) case, reassessment of the carrying values of asset restoration obligations for certain aircraft and credit memos received from various aircraft manufacturers,” it also said.

Last year’s topline number was driven by a 4.2% increase in passenger revenues as there were additional frequencies and new routes, but these were partly offset by lower cargo and ancillary revenues at 8.2% and 5%, respectively.

Although consolidated expenses last year decreased by 3.1% to P151.66 billion, the company was weighed down by financing charges of P12.03 billion and other charges of P2.04 billion.

“The main contributors for the decrease were flying operations and passenger service expenses, which were partly offset by the increase in aircraft and traffic servicing expenses,” it said.

For 2020, PAL said the coronavirus pandemic could have a material impact on its financial results this year and even periods after.

PAL President and Chief Operating Officer Gilbert F. Santa Maria said in a recent virtual conference that the current crisis is “a great time of turmoil” for the company.

“But we have been around for almost 80 years, so we are not giving up. We will be around for a while longer,” he added.

He noted that there had been “reluctance” among people to travel, but the company is now carrying out measures to build their confidence to fly again.

On whether the prices of flight tickets would go up, he said: “You are asking if ticket prices are going to be up? The quick answer is somewhat.”

“You understand that in airlines, the CAB (Civil Aeronautics Board) will not allow us to raise prices…. But within the airline itself, there are different classes of seats, so we will charge different prices for promotions and different prices for standard and regular seats, and so we will work within that framework to allow us to fly economically but safely,” he said further.

On Wednesday, shares in PAL inched up by 0.14% to close at P6.95 apiece. — Arjay L. Balinbin