Cebu Air operator of the country’s largest carrier Cebu Pacific, said net income in 2017 dropped by 18.9 percent to P7.91 billion from P9.75 billion in 2016 due to higher fuel prices and operating expenses.
Operating expenses swelled by 16.6 percent to P57.90 billion in 2017 from the P49.65 billion recorded in the previous year.
“The increase was primarily due to the rise in fuel prices in 2017 coupled with the weakening of the Philippine Peso against the US Dollar,” the company said in a disclosure.
Cebu Air Inc is the parent company of airline brands Cebu Pacific and Cebgo.
Cebu Air said that the Philippine peso ended 2017 at an average of P50.40 per US dollar compared to the previous year’s P47.50 per US dollar.
“The growth in the airline’s seat capacity from the acquisition of new aircraft also contributed to the increase in expenses,” Cebu Air added.
The airline company said revenues went up by 9.9 percent from P61.90 billion in 2016 to P68.03 billion in 2017, as passenger revenues increased by 7.2 percent to P49.931 billion.
“This was mainly attributable to the 3.2 percent growth in passenger volume to 19.7 million from 19.1 million last year, driven by the increase in number of flights by 3.6 percent in 2017 as the Group added more aircraft to its fleet,” the company said.
Cargo revenues reached P4.60 billion, increasing by 29.2 percent from the previous year, while ancillary revenues went up by 14.9 percent to P13.49 billion.