Cebu Air Inc. (PSE: CEB) reported total revenue of P74.5 billion for the nine months ending September 2024, an 11% increase compared to the same period last year.
This growth was driven by 17.5 million passengers flown, a 13% increase year on year, generating an average seat load factor of 84.9%. CEB’s operating income for the period was P5.7 billion, 8% lower than last year, and its net income was P3.4 billion, 33% lower than last year.
The margin pressure was driven by increased expenses in relation to the airline’s investment in additional aircraft and engines. CEB ended September with a fleet of 91 aircraft, 10 aircraft more than the same period last year. It also invested in 10 additional spare engines to sustain its growth and improve operational reliability.
For the third quarter of 2024, CEB revenues posted P23.1 billion, 1% lower year on year, due to seasonality shift driven by the earlier start of the K-12 academic year. The airline flew over six million passengers for the quarter, a 14% increase year on year, but with stimulation efforts through lower average fares.
Passenger fares averaged P2,577 per passenger, 15% lower year on year. Coupled with margin pressure from additional fleet and financing expenses, CEB’s operating income for the quarter declined to P202 million from P2.4 billion, and it incurred a net loss of P173 million compared to P1.3B net income in the same period last year.
CEB deployed its new aircraft deliveries to expand its regional hubs in Cebu, Clark, Davao and Iloilo, and to upgauge to bigger aircraft in Manila. It also recently acquired AirSWIFT, growing its turboprop fleet, and bringing El Nido, one of the Philippines most popular leisure destinations, into its network.
“CEB has a unique opportunity to grow when others cannot. So, despite the short-term impact to margin development, we will be growing rapidly, creating a robust network across the Philippines to expand and strengthen our market presence.
We expect to reach a domestic market share of nearly 60% in the fourth quarter from 52% before the pandemic. Airport and aircraft investments open a significant market potential for CEB, and these initiatives allow us to take advantage, as well as contribute to the overall Philippine growth story,” said Cebu Pacific Chief Finance Officer Mark Cezar.
