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Philippines: Pandemic deals heavy blow on low-cost carriers
MANILA, Philippines — The financial and operational performance of low-cost carriers Cebu Pacific and AirAsia Philippines suffered severely last year due to the pandemic.
Cebu Pacific yesterday reported a P22.2 billion net loss in 2020, a reversal of the P9.12 net income in 2019.
The airline said it flew five million passengers last year, 78 percent lower than the 2019 level, and a total of 41,804 flights, which is a 71 percent reduction from the previous year as a result of heightened travel restrictions and a decrease of passenger confidence.
From about 400 flights daily pre-COVID, Cebu Pacific flew an average of 47 flights a day in the third quarter and 76 flights a day by December last year.
As a result, revenues of the Gokongwei-owned budget carrier plunged by 73 percent to P22.6 billion last year from P84.8 billion in 2019.
Cargo operations contributed P5.4 billion, or 24 percent of Cebu Pacific’s total revenues last year, as cargo freighter and charter flights contributed to higher yield.
“Amid severe losses incurred in 2020, Cebu Pacific is pleased to announce the successful completion of two significant fundraising initiatives,” the airline said, referring to its P12.5 billion convertible preferred shares offer and a P16 billion 10-year term loan facility with a syndicate of domestic banks,” the carrier said.
Meanwhile, revenues of AirAsia Philippines tumbled by 77 percent to P6.33 billion in 2020 from P27.36 billion in 2019.
Passengers carried by airline in 2020 stood at 2.01 million, 77 percent lower than the 8.55 million passengers flown in 2019.
In the fourth quarter, however, AirAsia Philippines saw an improvement as it almost doubled the number of passengers carried from the previous quarter.
“RASK (revenue per available seat-kilometer) for AirAsia Philippines outperformed other entities reporting an increase of 101 percent in the fourth quarter of 2020 and eight percent overall in 2020 due to higher number of chartered flights,” AirAsia Group Bhd president for airlines Bo Lingam said.
“We are pleased to be gradually ramping up our domestic operations in our key markets, which are concentrated on the most profitable and popular routes. We are also actively exploring opportunities to gain market share, especially in the Philippines and Indonesia, recognizing our strength in the Asean region,” AirAsia Group CEO Tony Fernandes said.
Source: https://www.philstar.com/business/2021/03/31/2088112/pandemic-deals-heavy-blow-low-cost-carriers