The 1st quarter operating results for airlines worldwide have shown a promising trend, with many carriers returning to profitability. This is particularly significant for Asia-Pacific airlines, which faced the brunt of strict COVID-19 lockdowns and travel restrictions. Among these airlines, the Philippines’ low-cost carrier, Cebu Pacific, has swung to profitability, posting its first quarterly profit since the pandemic began.
Cebu Pacific’s Profitable 1st Quarter of 2023
Cebu Pacific recently reported a net profit of PHP1.1 billion ($19.91 million) for the 1st quarter of 2023, a stark contrast to the PHP7.6 billion ($137.56 million) loss incurred during the same period in 2022. This remarkable turnaround was primarily driven by the airline’s strong passenger and ancillary revenues.
During the 1st quarter of 2023, Cebu Pacific generated total revenues of PHP20.9 billion ($378.3 million), a 211% increase compared to the same period the previous year. The airline’s passenger business contributed PHP14.3 billion ($258.8 million), while sales from ancillary products amounted to PHP5.46 billion ($98.8 million). Compared to the 1st quarter of 2022, these figures represent a 352% and 221% growth, respectively.
Impressive Operational Performance
In the 1st quarter, Cebu Pacific operated 32,000 flights and carried over 4.8 million passengers, a 94% and 135% increase compared to last year. The airline’s passenger load factor also improved, reaching 83% in the 1st quarter of 2023, a 13-percentage point increase year-on-year. Additionally, the carrier managed to control its operating expenses as it grew, with only a 63% increase compared to the same period last year.
The airline’s operating income turned positive, reaching PHP1.24 billion ($22.44 million) compared to the PHP5.34 billion ($96.65 million) operating loss in the 1st quarter of 2022. Cebu Pacific attributes this sharp turnaround to “increased utilization of aircraft and operating systems, coupled with higher productivity of crew and personnel.”
Expanding Fleet and Network
Cebu Pacific currently operates a fleet of 73 aircraft, including a mix of Airbus jets and ATR turboprops. The airline expects to exceed pre-pandemic capacity system-wide in the 2nd quarter, based on an “optimistic outlook” as tourism continues to recover and the strengthening of its Philippines hubs at Clark International Airport (CRK) and Cebu Mactan International (CEB).
With travel restrictions easing in North Asia, the airline has resumed flights from Cebu to Hong Kong, Macau, and Melbourne International Airport (MEL). Cebu Pacific now operates 60 routes and more than 2,100 weekly flights within the country, flying to 24 international and 34 domestic destinations. The carrier plans to further expand its domestic network and increase frequencies on existing routes during the 2nd quarter.
Cebu Pacific swinging to profitability since the COVID-19 pandemic is a testament to the airline’s resilience and adaptability. Strong revenues and efficient operations have enabled the carrier to bounce back and expand its network in a challenging environment. As the aviation industry continues to recover, Cebu Pacific is well-positioned to capitalize on this growth, providing exceptional services to passengers across the Philippines and beyond.
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