MANILA – Low-cost carrier Cebu Pacific said its earnings went down by 83 percent last year due to foreign exchange losses amounting to P2.1 billion.
In a disclosure, Cebu Pacific said its net income slid to P512 million in 2013 from P3.57 billion in 2012.
Cebu Pacific President Lance Gokongwei said bulk of the company’s debt arising from the acquisition of aircraft and fuel expenses are denominated in US dollars.
He noted, however, that the airline maintained its dominance in the domestic market with a 50.4 percent share, and continued its growth in the international market with 16.3 percent overall share and a 23.8 percent share on routes that it operates.
The airline’s volume of passengers also jumped 8.3 percent to 14.4 million in 2013 from 13.3 million in 2012.
The firm's financial outlook for the first half of 2014 remains bleak, but Gokongwei expects improvement in the second half.
“In terms of financial performance, we are likely to see our first half this year significantly worse than the first half of last year due primarily to forex losses, international competition, long haul losses as well as the acquisition of Tigerair,” he said.
“We expect our second half to be due to the benefits of the integration of Tigerair Philippines and alliance we have with Tigerair Singapore and improved performance from our long haul operations as well as continuing improvements in our asset utilization and cost structure,” he added.
Cebu Pacific is spending about $7 million to acquire the 40 percent share of Tiger Airways Singapore Pte Ltd.
The airline is spending an additional $8 million for the 60 percent owned by Filipino businessmen in Tigerair Philippines.