The financial losses arising from the canceled and delayed flights due to the air traffic navigation glitch on Jan. 1 will not derail the recovery plans of Cebu Pacific, which eyes to return to profitability as early as first quarter of this year.
The budget carrier, which is nearing full restoration of flight capacity, is also allocating P42 billion in capital expenditures this year for mostly aircraft-related spending.
Cebu Pacific president Xander Lao, on the sidelines of an event on Wednesday in Makati City, told reporters that the New Year’s Day incident only had minimal impact financially for the company, which operated 16 recovery flights following the shutdown of the communications, navigation and surveillance/air traffic management system. He did not disclose specific figures.
“It’s just one day. Obviously, it’s not a great experience for those that were impacted [but] those that were travelling Jan. 2 onwards, [operations were already normalized],” he explained.
Despite the initial setback, Lao said the Gokongwei-led airline is targeting to turn in profits by first quarter, which would be the first time since 2020 when flights were grounded at the height of the pandemic.
“We are hoping for a full-year net income. First quarter traditionally for the airlines has been strong [usually], in particular, January,” he added.
In January to September of last year, Cebu Pacific operator reported its net losses were narrowed to P12.05 billion from nearly P22 billion in the same period in 2021 with the further return of mobility.
Candice Iyog, Cebu Pacific vice president for marketing and customer experience, said the budget carrier was set to fully restore its 34 domestic and 25 international routes by March.
It currently accommodates about 350 flights per day on average, which is nearing the 380 to 420 daily flights prior to the pandemic. Last year, it flew nearly 15 million passengers, a marked growth from just 3.3 million passengers in 2021.
“We are back,” Iyog said.
She was optimistic that international routes will drive the recovery this year, noting the easing travel requirements to several countries including Bangkok, Taiwan, South Korea, Japan, Australia, Hong Kong, Macau and China.
Cebu Pacific will offer flights to Xiamen, China, next month. It is set to increase flight capacities to Guangzhou, Shanghai and Shenzhen this month.
By March, the low-cost airline will increase flight frequencies from Manila to Bangkok, Brunei and Sydney. It will also open routes to Melbourne and Macau the same month.
The budget carrier took delivery of its ninth Airbus 320neo (new engine option) aircraft earlier this month. It is set to receive 10 more new units this year: three A320s, three A321 and four A330, all in the “neo” configuration.
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