PAL returns to profit, nets P56.5 billion in 2021

MANILA, Philippines — Philippine Airlines has broken its losing streak in 2021, as the company was able to post a net income for the first time since 2016.

Listed parent firm PAL Holdings Inc., in its annual report, said the company recorded a comprehensive income of P56.49 billion in 2021, a significant turnaround from the previous year’s total comprehensive loss of P73 billion.

The last time PAL was profitable was in 2016, despite net earnings falling by 39 percent year-on-year then.

PAL said its consolidated revenues rose by 6.2 percent to P58.70 billion from P55.26 billion in 2020.

“The significant increase in revenues was mainly due to the increase in cargo revenues as air cargo has been a vital partner in delivering essential goods since the COVID-19 pandemic,” it said.

Cargo revenues jumped by nearly 60 percent in 2021 to P15.02 billion from P9.41 billion the previous year.

Passenger revenues, on the other hand, fell by 11 percent to P37.26 billion from 2020’s P41.86 billion.

PAL emerged from the Chapter 11 restructuring in December last year after it received unanimous support from its lenders, aircraft lessors, equipment manufacturers, and service providers.

In line with its fleet optimization, PAL as of end-2021 said it has already returned surplus aircraft to the lessors.

PAL expects to return an additional nine aircraft this year.

The airline’s purchase agreement with Airbus has also been amended to defer the delivery of 13 Airbus 321-231 NEO aircraft from the current schedule of delivery from 2021 to 2025, to 2026 to 2029.

As of end-2021, PAL’s consolidated total liabilities declined by 35.1 percent year-on-year to P192.16 billion.

The company said the unsecured debts were converted to equity and aircraft lease modifications were executed according to the US Court’s approval of the restructuring plan.

Its current liabilities decreased by P125.87 billion, mainly due to the decrease in the current portion of long term obligations, accrued expenses and other current liabilities, and notes payable as a result of lease modifications and debt settlement.

PAL chairman and CEO Lucio Tan in a statement earlier said that the airline is gearing for a comeback year this year after a challenging past two years, with its 81st year marking a rebirth for PAL.

Part of PAL’s plans moving forward is a robust cargo strategy, wherein it will deploy more all-cargo flights to develop key international cargo markets.

The airline also intends to introduce a new cargo mobile app and website, as well as enter into last mile cargo delivery service via partnerships with express delivery firms in the Philippines.