Philippine Airlines (PAL) will implement “a disciplined investment plan” in the near term, as it reported a steep decline in second-quarter profitability amid yield “pressures” and an rise in operating costs.
The Manila-based carrier’s operating profit for the three months ended 30 June stood at $64 million, down 64% year on year. Revenue for the quarter was down 4% to $787 million, “reflecting yield pressures brought about by the return of more capacity to the market”, says PAL.
The airline notes that its operating profit for the quarter was also “negatively impacted” by higher costs related to flying and maintenance activities.
Adds airline chief Stanley Ng: “As the industry adjusts to a re-balancing between demand and capacity, and continues to face cost and supply chain challenges, we are implementing a disciplined investment plan to upgrade our fleet and continue our digital transformation so that we can serve our passengers better.”
PAL adds that the decline in profitability was “in line with expectations…amid a normalising market environment versus the travel demand surges of 2023”.
For the six months ended 30 June, PAL reported an operating profit of $182 million, 42% lower compared to the year-ago period.
Revenue, which stood at $1.6 billion, up about 14% compared to the previous year, as PAL saw an increase in passenger traffic. The airline carried 7.9 million passengers in the half-year, up 13%, while number of flights grew 11%.
