MacroAsia suffers sharp profit drop

Manila, Philippines -  Lucio Tan-led aviation services firm MacroAsia Corp. reported a sharp fall in net income for the first half of the year to P17.47 million from P126.59 million in the same period in 2011 as a spike in costs ate into profit.

Amid Europe’s mounting financial crisis and the economic slowdown in the United and China, MacroAsia managed to post a 33 percent rise in consolidated revenues to P864.09 million on the back of a 64 percent jump in revenues from in-flight and other catering segment to P549 million.

This is due to higher meal volume and passenger count during the period.

Revenues from the ground handling and aviation segment likewise climbed 54 percent to P212 million, largely due to increased passenger load and flight frequencies of the group’s serviced clients.

Rental and administrative revenues remained at par with last year’s comparable period as lease rental has been aligned with Philippine Accounting Standards.

On the other hand, revenues from the charter flights segment fell 62 percent to P8.87 million due to the completion of contracts with the mining sector in 2011.

Total direct costs, however, increased 25.6 percent to P604.09 million largely due to the start-up expenses relating to the A380 hangar.

The group’s maintenance, repair and overhaul (MRO) business showed an accumulated loss during the period.

MacroAsia’s financial position, however, remains strong as of June 30, 2012 with total assets amounting to P3.7 billion. Cash and cash equivalents stayed at the P1-billion level while receivables stepped up by 16 percent to P443 million.

MacroAsia president Joseph Chua earlier said the company’s net income would continue to soften this year due to the full impact of rising fuel prices coupled with the deepening international debt crises. Profit was forecast to drop to around P246 million from P306.62 million in 2011.

The company, however, is expected to return to growth in 2013 with net earnings seen to hit over P300 million.