Cebu Pacific (CEB), the aviation unit of the Gokongwei Group, reported a huge turnaround with a net income of P5.03 billion for the first nine months of the year from a net loss of P12.05 billion incurred in the same period in 2022.
In a disclosure to the Philippine Stock Exchange (PSE), CEB reported that its revenues surged by 78.2 percent to P66.9 billion in 2023’s nine-month period from P37.5 billion last year due to an increase in passenger volume because of higher demand for travel.
International flights in particular leapt by 236.2 percent this year, accounting for a 105.2 percent increase in passenger revenues to P46 billion this year from P22.5 billion last year.
Passenger volume increased by 48.8 percent to 15.5 million from 10.4 million and, as international travel demand significantly rose in the third quarter, average fares also grew by 37.9 percent to P2,970 from P2,154.
Ancillary revenues also shot up by 88.5 percent to P17.8 billion from P9.4 billion last year driven by the higher passenger volume and flight activity for overseas trips.
Meanwhile, cargo revenues dropped by 47 percent to P2.97 billion from P5.6 billion last year because of lower cargo kilograms flown and yield from cargo services.
Operating expenses of CEB were 24.7 percent higher at P60.7 billion from P48.7 billion, partly influenced by the weakening of the Philippine peso against the US dollar.
Flying operations expenses increased by 31 percent to P6 billion from P19.6 billion due to a 56 percent hike in fuel consumption and increased flight activity in the nine-month period.
The airline, however, expressed confidence of increasing their flight frequency as they observed higher bookings.
In the third quarter alone, the airline has flown four million domestic passengers on over 2,000 weekly flights, running at over 100 percent of pre-pandemic level, as well as 228 percent more passengers for international flights to 1.3 million compared to last year.
Travel demand is going up for destinations like Japan, Taiwan, Hong Kong, and Chine since the final quarter of last year. Flights to Melbourne, Australia; and Hong Kong from Cebu were also resumed while a new flight from Manila to Da Nang, Vietnam will begin in December this year.
“With these improvements and supported with the Group’s latest network plan, by fourth quarter of 2023, international network will further grow to 37 routes with over 490 weekly flights,” said CEB.
By the fourth quarter of 2023, the airline said it "will be going beyond pre-pandemic capacity levels on a system-wide basis."
"Improvement in both capacity and seat load factors driven by higher bookings, support the outlook for improvement in the Group’s revenues and profitability margins,” it added.