Author : Editor
The management of Philippine Airlines (PAL) said it “welcomes” the possible entry of a new investor in the flag carrier.
In an interview with journalists Monday night, PAL president Jaime Bautista said “we in management want new equity,” which would enable the airline to undertake a much-needed refleeting by 2015 to upgrade its aging fleet.
“By 2015 we need to replace our (Boeing) 747s which are already 21 years old. They are still good, but the cost of maintenance and cost to operate them is high,” he said.
Bautista said management, however, has not been updated on the status of top-level talks between PAL chairman and owner Lucio Tan and Ramon Ang of San Miguel.
Thus, the PAL president said he was not in a position to state when a deal could be concluded.
He assured, however, that “even without new money, we can still operate, but our capacity to compete is limited.”
Bautista said for its current fiscal year, PAL is expected to land in the red due to high fuel costs and loss of revenues from the recent strikes that crippled its operations, as well as the reduction of flights as it shifted to outsourcing ground operations.
PAL’s fiscal year starts April 1 and ends March 31 of the following year.
He said losses were incurred during the months of September, October and November.
Additionally, Bautista said the tsunami which hit Japan also led to a 20-percent decline in PAL’s traditionally profitable Japanese market.
Likewise, the flooding in Thailand also affected the airline, with both incidents shrinking revenues by more than $10 million.
But last December, Bautista said, “We were back to normal and this January is also expected to be a profitable month.”
However, he clarified that February is a traditionally “losing” month “because there are only 28 days, but our expenses are for 30 days.”
High fuel costs, though, remains the main reason for PAL’s expected loss for fiscal year 2011-2012, he said.
Last September, PAL reported a loss of $39.4 million for the second quarter (July to September 2011).
PAL had projected an average fuel cost of $120 per barrel, but the actual cost reached up to $135/barrel.
Source : abs-cbnnews.com
