Cebu Pacific reported a 5.4 percent decline in net income to P3.54 billion in the first six months this year, primarily due to escalating jet fuel prices and the weakened peso.
The Gokpngwei-led airline posted a net income of P3.54 billion in the January to June period, down from P3.74 billion in the same period last year.
Group revenue amounted to P51.439 billion, up 18.1 percent to P43.55 billion earned in the same period last year.
Passenger revenue increased by 18.4 percent to P35.68 billion from P30.12 billion in the same period last year due to overall increase in travel demand.
Passenger volume increased by 12.1 percent while average fares increased by 5.7 percent to P3,101 during the period.
Cargo revenue also increased 31.9 percent to P2.63 billion from P1.99 billion due to a 26.8 percent increase in cargo volume and a 4 percent increase in cargo yield.
The Group incurred operating expenses of P45.95 billion, higher by 15.5 percent compared to P39.790 billion in the same period last year.
“The increase was mainly driven by the increase in flight activity, since a material portion of expenses are based on flights and flight hours,” Cebu Pacific said.
The company said the weak peso against the U.S. dollar went from P55.25 per U.S. dollar to P56.91 per U.S. dollar based on the Philippine Bloomberg Valuation (PH BVAL) weighted average rate that also contributed to the increase in operating expenses.
Flying operations expenses increased by 14.2 percent to P19.15 billion from P16.77 billion last year.
“This was largely due to higher fuel consumption and pilot headcount, in line with the increased flight activity, and the slight increase in average published fuel MOPS price to USD100.46 per barrel from USD99.26 per barrel average in the same period last year, coupled with the weakening of the Philippine Peso against the U.S. Dollar,” Cebu Pacific said.
Early in July, Cebu Pacific announced signing a Memorandum of Understanding (MOU) with Airbus for the purchase of up to 152 A321neo aircraft for $24 billion ( P1.4 trillion), the largest aircraft order in Philippine aviation history.
The airline operates one of the youngest fleets in the world with a diversified commercial fleet mix of nine Airbus 330s, 39 Airbus 320s, 22 Airbus 321s, and 15 ATR turboprop aircraft enabling the widest network coverage in the Philippines.
The airline flies to 35 domestic and 26 international destinations across Asia, Australia, and the Middle East.
