Cebu Pacific widens loss to P12.84 billion on fuel costs
Philippine low-cost carrier Cebu Pacific's parent, Cebu Air Inc., reported a P12.84 billion net loss for the nine months to September, as expenses grew faster than revenue.
Nine-Month Losses Deepen
Cebu Air Inc., parent company of low-cost airline Cebu Pacific, recorded a net loss of P12.84 billion for the nine months ending in September. This marks a significant reversal from the P9.46 billion profit the carrier posted during the same period last year. The company's financial report showed revenue increased by 10 percent to P96.23 billion. However, expenses rose more sharply, climbing 24 percent to P99.23 billion.
Rising Fuel and Servicing Costs
The primary driver of increased expenses was a 52 percent surge in flying costs, reaching P44.13 billion. This was attributed to elevated jet fuel prices, exacerbated by security tensions in the Middle East. Additionally, Cebu Pacific reported an eight percent rise in servicing costs, totalling P12.41 billion, due to new fees imposed by airport operators. These cost pressures outpaced gains from higher passenger volumes.
Passenger Growth and Fleet Expansion
Despite the financial setback, Cebu Pacific saw a four percent increase in passenger volume, carrying 20.77 million travellers between January and September. Company President and Chief Commercial Officer Alexander Lao expressed confidence that the airline would surpass 27 million passengers for 2026, exceeding last year's record of 26.88 million.
To meet demand, Cebu Pacific is expanding its fleet, expecting final delivery of an Airbus A330neo by December, bringing its total aircraft to 100. Seven new single-aisle jets are scheduled for delivery in 2027.
Cebu Pacific's ability to maintain profitability will depend on its capacity to manage persistent cost inflation, particularly in jet fuel. While passenger demand remains strong and fleet expansion continues, the airline faces a challenging environment where operational expenses are rising faster than revenue growth.
Investors will observe how the carrier mitigates these input costs against its ambitious growth targets in the coming quarters.
This article is journalism, not investment advice; consult a licensed professional before making financial decisions. Market data is indicative, may be delayed, and should be verified with your broker or exchange before use.
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