Budget carrier Cebu Pacific, the largest
airline in the Philippines, is open to mergers with other airlines including
flag-carrier Philippine Airlines (PAL), its president said.
Speaking
in a conference call from Manila, Cebu Pacific President Lance Gokongwei said
that his airline had a “strong balance sheet” compared to rival carriers. Asked
if he was considering a merger with PAL, he said: “We are not in any current
discussions with Philippine Airlines but . . .
if the opportunity arose, I would certainly look at it.”
Regarding
possible consolidation in the industry, Gokongwei said that he believed many of
Cebu Pacific’s competitors, which he did not name, needed additional capital
from their owners to stay in the air, literally.
“Cebu
Pacific continues to operate in a profitable manner. We are able to make money
and fund our growth plans,” he told reporters. Gokongwei said that higher fuel
prices and other increased costs had lowered the airline’s profits in 2011 but
stressed it still posted positive figures.
Net
profits in 2011 amounted to P3.62 billion, a 48-percent fall compared to 2010,
company figures showed. However, total revenues in 2012 rose 16.7 percent to
P33.9 billion while total passengers increased 14 percent to 11.9 million.
Gokongwei
forecasted that total passengers would rise to 14 million this year. Last
month, a PAL spokeswoman confirmed that the loss-making flag carrier was in
talks to sell part of its stake to local conglomerate San Miguel Corp.
PAL,
majority owned by Philippine tycoon Lucio Tan, suffered a P1.45-billion pre-tax
loss in the three months to December 2011, its listed parent firm, PAL
Holdings, reported. The flag carrier was forced to cancel many flights during
that quarter amid a wildcat strike as airline management outsourced 2,600 jobs
in in-flight catering, airport services and call center reservations in an
effort to cut costs.
PAL had
a near-monopoly on the domestic aviation market two decades ago but has since
been overtaken in number of flights by Cebu Pacific. Although some budget
carriers in Asia are reportedly cutting back, Cebu Pacific is still pushing
through with its plans to begin long-haul flights by next year using Airbus
A320 aircraft, Gokongwei said.
He
added that this service would cater to the estimated 10 million Filipinos
working overseas, particularly those traveling to and from the Middle East,
Australia, North Asia and Europe.
manilatimes.net
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