Cebu Air flies to path of full recovery this year

Bloomberg

Cebu Air Inc. will fully restore its pre-pandemic capacity in March, putting the Philippines’ largest budget carrier on the path to “full recovery and profitability” this year, said President and Chief Commercial Officer Alexander Lao.
Cebu Air probably cut its loss to 2.09-billion peso ($38.3 million) in 2022, according to street consensus, as easing of virus curbs and travel restrictions allowed it to mount more flights. Its losses peaked 27.2 billion pesos in 2021 after a 23-billion peso loss in 2020.
With low probability of lockdowns, the biggest risks facing Cebu Air’s return to profitability would be a surge in global fuel prices and a reversal of the Philippine peso’s recent appreciation, Lao said in an interview. Growth will be led by international operations, with Hong Kong probably its biggest market and long haul destinations among its fastest growing, he said.
Cebu Pacific, owned by Manila-based JG Summit Holdings Corp., is one of the few airlines that didn’t go into bankruptcy proceedings as the pandemic hammered travel. Aside from cutting workforce and routes, the airline raised $250 million in May 2021 through convertible bonds sale that followed a 12.5-billion peso stock rights and a 16-billion peso loan from local banks earlier that year.
“Domestic capacity has already exceeded pre-pandemic levels while almost all of our international destinations have reopened,” Lao said. Cebu Pacific now flies a little over 350 flights a day, nearing its 380 to 420 pre-pandemic daily average, he said.
Still, the airline’s passengers this year will probably not reach the 22 million it flew in 2019 as its capacity now is only at around 92%, he said. Cebu Air flew 15 million passengers last year compared with 3.3 million in 2021, he said.
The airline will take delivery of new 10 wide and narrow bodied Airbus aircraft this year, he said, adding the company is on target to have an all Neo fleet by 2028. Cebu Pacific has already restored all 34 domestic destinations and expects all of its 25 international destinations to be operational in March, Vice President Candice Iyog said.