PAL posts ₱11.8 billion loss in 9 months, seeks growth with US expansion

PAL Holdings, the parent company of Philippine Airlines (PAL) Inc., has reported a significant net loss of ₱11.8 billion over a nine-month period ending on March 31, 2013. This figure represents a 332 percent increase from the ₱2.74 billion net loss recorded in 2012.

Despite the losses, the flag carrier's revenue remained steady at ₱55.97 billion during the first nine months of the 2013-2014 fiscal year (May to March), compared to a net profit of ₱55.68 billion in 2012.

The airline experienced a drop in passenger traffic, falling to approximately 5 million from 7.6 million. This decrease led to a 3 percent drop in passenger revenue. On a positive note, the airline saw a 13.7 percent increase in cargo revenue.

In recent developments, PAL announced plans to expand its operations to the United States. This decision came after the Federal Aviation Administration upgraded the Philippines to Category 1 status from Category 2, a rating held from 2009 to 2013. In line with this expansion, Philippine Airlines has opted to use the Boeing 777-300ER for some of its US routes.

The use of the Boeing 777 on US routes is expected to result in substantial savings for the airline. PAL anticipates saving $160 million, with $100 million attributed to fuel costs over a year and $60 million to maintenance costs.

As part of their expansion strategy, the airline plans to increase the frequency of flights to certain US destinations. The airline will operate 14 weekly flights to Los Angeles, 7 weekly flights to Honolulu, and 14 weekly flights to Guam.

At present, the flag carrier operates 26 weekly flights to the United States, serving destinations including Los Angeles, San Francisco, Honolulu, and Guam.