MANILA, Philippines — Flag carrier Philippine Airlines finally returned to profitability in the first quarter, thanks to “stronger” recovery in travel demand that coincided with its emergence from a creditor-backed bankruptcy process.
In a statement on Friday, PAL reported it netted P1.2 billion in the first three months of the year. The last time the company posted positive first quarter results was in 2016.
PAL Holdings Inc., the airline’s parent, broke the news 20 minutes after the stock market closed. Shares in PAL Holdings capped the week up 1.84%.
Explaining its financial results, PAL said revenues amounted to P24 billion last quarter due to 201% year-on-year growth in passenger revenues and a 72% growth in cargo revenues. The company said the gains were due to “a stronger recovery in travel volumes” as borders at home and abroad reopened.
Operating expenses, however, jumped 50% year-on-year to P22.3 billion due to a sharp increase in fuel prices in recent months as a result of the ongoing war in Europe. Stanley Ng, company president and COO, said PAL must protect the gains by “exercising fiscal discipline and faithfully carrying out our restructuring initiative.”
“Just the same, we must not lose sight of the considerable headwinds we continue to face, brought about by rising fuel prices, the economic fallout from geopolitical events such as the conflict in Ukraine, and the incomplete recovery in travel markets, as certain Asian regions have yet to fully open their borders,” Ng added.
After exiting the Chapter 11 bankruptcy process, the carrier still needs to make sure it can recover from a pandemic-led slump. And part of this goal is to raise more funds to bankroll its post-restructuring needs.
PAL expects to return to pre-pandemic levels in its domestic network within the second or third quarter of 2022.