PAL posts $28-M net income in second quarter

Monday, 22 November 2010 18:51 Lenie Lectura / Reporter
Business Mirror

AMID the continued rise in prices of aviation fuel, flag carrier Philippine Airlines (PAL) was able to report a net income of $28.2 million for the second quarter in its fiscal year ending March as against a net loss incurred in the same period a year ago.

The airline’s improved performance was on the back of increasing revenues of $399.5 million, up by 3 percent from $299.7 million in 2009.

Still, PAL president Jaime J. Bautista remains cautiously optimistic about the airline’s growth prospects. “The global airline industry remains vulnerable to volatile market conditions. Take fuel, for example. If the upward trend continues, it could wipe out all our recent gains,” he said in a statement.
PAL realized a huge reduction in maintenance expenses by 36 percent as a result of cost-saving initiatives despite fuel costs rising from an average of $79.06 per barrel for the quarter ended September 2009 to an average of $97.73 per barrel in the same quarter period this year. Fuel comprises approximately 40 percent of PAL’s total expenses.

The airline said is now closely watching the recent reemergence of the AH1N1 virus in Hong Kong. The avian flu can dampen demand at a time when the Philippines has yet to fully recover from the stigma of the recent hostage crisis involving Hong Kong nationals and the negative travel advisory against the Philippines.
To remain viable, Bautista said the flag carrier will focus on continuing its cost control initiatives.
In a separate statement, Bautista said PAL welcomes the Aquino administration’s announcement on the impending Executive Order implementing pocket open skies.

“We welcome the President’s vision to promote a competitive international aviation sector anchored on “a strong Philippine-based aviation industry”, which we firmly believe is indispensable to the development of tourism, trade and economic progress. As the national flag carrier, we will continue to work in partnership with the government to attract more visitors from both existing and new markets overseas,” he said.

PAL, he said, has always led the way in promoting RP tourism, by being the most aggressive airline in pioneering new routes, serving key tourism markets, and making necessary investments to put the Philippines on the tourism map as a destination for the world.

Next year, the company will launch a new route to New Delhi, India. Bautista said PAL is the only airline flying between the Philippines and Canada, Tokyo (to/from Cebu), Western Japan, Las Vegas, Melbourne, and nonstop from the US.