Cebu Pacific operator’s net loss widens to P8.2 billion

CEBU AIR, Inc., the listed operator of budget carrier Cebu Pacific, saw its attributable net loss widen to P8.2 billion in the third quarter from a loss of P5.54 billion in the same period a year ago, mainly due to the impact of the global health crisis on its operations.

In its quarterly report released on Tuesday, the listed company said its total revenues for the period climbed 62% to P3.24 billion last quarter from P2 billion in the same period in 2020.

Passenger revenue rose to P1.31 billion in the third quarter from P379.19 million in the same period last year.

Cargo revenue for the quarter went up 9% to P1.45 billion from P1.33 billion previously, while ancillary revenue increased 63.4% to P484.10 million from P296.28 million in the comparable year-ago period.

However, expenses reached P9.4 billion, up 7.6% from P8.74 billion last year, resulting in an operating loss of P6.15 billion from P6.74 billion previously.

Attributable net loss for the first nine months widened to P21.99 billion from a loss of P14.69 billion in the same period last year.

The company’s January-to-September total revenues dropped 52.7% to P9.15 billion from P19.34 billion in the same period in 2020. Operating loss reached P18.84. billion from P13.72 billion last year.

As of Sept. 30, Cebu Air said its consolidated assets decreased to P128.40 billion from P128.46 billion as of Dec. 31 last year, mainly due to asset depreciation recognized during the period, which was offset by an increase in cash from the receipt of proceeds from the issuance of convertible preferred shares and convertible bonds.

“Equity decreased to P13.21 billion from P22.69 billion last year due to net losses incurred offset by the aforementioned issuance of preferred shares,” the firm noted.

The company expects that the global health crisis would have a material impact on its liquidity. However, it is “confident on its ability” to raise cash for liquidity needs even if there were unprecedented losses incurred as a result of an expected slow recovery from the crisis.

“The group remains in a strong balance sheet and equity position at the end of the period,” Cebu Air said.

At the same time, the company believes Cebu Pacific remains a “resilient airline” despite the adverse impact of the health crisis on its operations.

“The group is actively engaged in planning and executing various measures to mitigate the impact of the… pandemic on its business operations. These include negotiations with key suppliers on capital expenditure commitments and related cash flows, as well as with other suppliers and stakeholders as they impact the group’s cash flows,” the company said.

Cebu Air shares closed 2.79% higher at P49.75 apiece on Tuesday. — Arjay L. Balinbin