Cebu Pacific (CEB) reported a P7.3-billion net loss in the first quarter this year, more than five times higher than the P1.2-billion loss posted in the same period last year.
This is due to the continuing travel restrictions brought about by the coronavirus disease 2019 (COVID-19) pandemic.
CEB revenues tumbled by 83 percent to P2.7 billion in the first quarter, from P15.9 billion revenues generated a year ago, attributed to the significant decline in passenger volume during the period.
“The overall decline in revenues was brought about by the impact of the COVID-19 outbreak which started with the cancellation of flights in early 2020 due to the imposition of travel restrictions. Commercial passenger operations restarted last June 3, 2020 for domestic flights, but in a limited capacity,” CEB said.
Passenger revenues went down by 92 percent to P887 million three months into the year, from P11.4 billion in the same period last year.
This was mainly due to the 87.5 percent decrease in passenger volume, from 4.4 million to 500,000 passengers, owing to lesser number of flights by 75.8 percent together with the 28.2 percentage points decline in seat load factor from 81.3 percent to 53.2 percent.
Ancillary revenues also dropped by 85.7 percent to P502 million for the three months from P3.5 billion generated a year ago, largely due to lesser passenger volume and flight activity during the period.
However, CEB’s cargo revenues increased by 30 percent to P1.3 billion in the first quarter from P1.01 billion in the same period last year, driven by higher yield from chartered cargo services.
Despite the significant losses, CEB was able to secure $250 million fresh funds from the International Finance Corp. (IFC), IFC Emerging Asia Fund, and Indigo Philippines LLC, an affiliate of Indigo Partners LLC.
The private equity firms have invested in CEB in the form of convertible bonds.
The investment will provide CEB with a longer liquidity runway to help the company withstand the effects of the pandemic until economic activity and travel demand recovers.
“We view Indigo, IFC, and IFC Emerging Asia Fund not only as capital providers but also long-term partners in driving improvements in the business, as well as accelerating our sustainability agenda,” said Lance Gokongwei, CEB president and chief executive officer.
“This will further strengthen CEB as we recover, so we may continue fulfilling our commitment to improve the lives of people in the communities we serve for a long time to come,” he added.
