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PAL losses swell to P2.19-B

Philippine Airlines Airbus A330-343X
REG: RP-C8782 (PHOTO) Lester Tangco

Posted at 11/15/2013 1:33 PM | Updated as of 11/15/2013 1:33 PM

MANILA, Philippines - PAL Holdings, parent of Philippine Airlines, said its losses ballooned to P2.19 billion in the first half of its fiscal year, due to lower passenger revenues.
PAL Holdings said its revenues fell 5.9% to P36.57 billion in the first half ending September, as passenger revenues went down 7.7% to P29.8 billion. Cargo revenues were steady at P2.7 billion.

"The decrease was attributable mainly to the unfavorable passenger revenue performance during the period as a result of lower passenger yields as well as the drop in volume of traffic flown," the company said.

As it restructured operations, PAL mounted less flights from April to September. PAL transferred most of its domestic flights to sister firm PAL Express, as it focused on international operations.
PAL said it had recognized P1.48 billion in other income due to a foreign exchange gain as a result of the revaluation of the retirement liability account balances which were peso-denominated. The peso strengthened against the US dollar earlier this year.
PAL Holdings' expenses were flat at P38.77 billion as of end-September despite higher costs for flying operations, maintenance, passenger service, reservation and sales.

"Other income recognized in the current period as well as lower expenses related to aircraft and traffic servicing contributed to the decrease in expenses, countered by the increase in flying operations, maintenance, passenger service, reservation and sales, general and administrative expense, and financing charges,” it added.

Fuel costs were still PAL’s biggest operating expense, but fell by 4.1% to P15.68 billion as average jet fuel prices fell.
PAL, jointly owned by tycoon Lucio Tan and conglomerate San Miguel Corp. (SMC), is currently in the middle of a fleet modernization program.

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