Cebu Pacific net profit soars to P9.12 billion in 2019

Aviation Updates Philippines – Cebu Pacific Air, the Philippines' largest low-cost airline, continues to lead the domestic air travel market after it reported a P9.12 billion net profit for the fiscal year 2019—a thumping 133-percent increase compared to P3.92 billion from the previous year.
STRONG BALANCE SHEET. Cebu Pacific Air recorded a net profit of P9.12 billion in the year 2019. However, things might be overturned due to the COVID-19 pandemic this year. Photo from Kit Stephen Agad, Click by Kit
Based on the airline's annual financial filing before the Philippine Stock Exchange (PSE), Cebu Pacific generated revenue of P84.81 billion from P74.11 billion the previous year. The increase can be attributed mostly to larger passenger and ancillary revenues.

Operating expenses grew to P72.19 billion as the low-cost carrier expands its operations. Fuel costs accounted for the majority of the flying expenses at P24.59 billion. However, it decreased by 3.4 percent from P25.43 billion the previous year due to plunging fuel price per gallon.

For 2019, Cebu Pacific and its subsidiary Cebgo said the overall passenger volume jumped by 10.8-percent to 22.5 million. The seating capacity it offered also roughly increased from 23.9 million the previous year to 26 million in 2019. The average load factor on all flights slightly increased to 86.4-percent from 84.8-percent.

Additionally, the number of flights the airline flew swelled by 6.5-percent to 143,897 as the airline received six more aircraft compared to 2018's statistics. Meanwhile, the average sector distance increased to 887 from 849 kilometers, given the airline's continued expansion on longer, thinner routes.

The Cebu Pacific Group, as of December 31, 2019, has employed a total of 4,352 active personnel. Most of the personnel are focused on the operations division while the minority is from the commercial and support departments.

However, as the Philippine aviation industry enters a standstill due to the coronavirus pandemic in the country, the net profit from last year may be overturned. The International Air Transport Association (IATA) anticipates a loss of up to $252 billion in airline revenue for the Asia-Pacific.

This month, Cebu Pacific's senior management opted to take salary cuts for as much as 10 percent to cope with financial difficulties. The airline was also forced to lay off 150 newly hired cabin crew.

Due to the pandemic, the Cebu Pacific Group canceled almost 3,000 flights to and from the Philippines. Most of the flight cancellations come from the airline's domestic hubs in Manila, Cebu, Clark, and Davao.