PHILIPPINE Airlines, Inc. and Cebu Air, Inc. on Tuesday said they stand to lose around P1.2 billion in revenues from the cancellation of more than 1,500 flights resulting from the country’s hosting of the Asia Pacific Economic Cooperation (APEC) Economic Leaders’ Meeting this week.
“PAL’s foregone or lost revenue due to APEC cancellations is approximately $18.7 million (over P880 million),” PAL Spokesperson Cielo C. Villaluna said in a mobile phone reply yesterday.
PAL President and Chief Operating Officer Jaime J. Bautista added separately via text: “It’s a good estimate of lost revenue.”
Ms. Villaluna said PAL cancelled over 700 flights, which represent more or less 2.5 days of operations, at Manila’s international airport to give way for the arrival and departure of world leaders attending the APEC summit.
The flag carrier operates around 260 flights and generates around $7.5 million in gross revenue daily.
However, Ms. Villaluna noted PAL’s revenue losses will be offset by the long-term benefits from the country’s hosting of the APEC summit.
“We must stress, however, that the long-term benefits of APEC outweigh these aforementioned losses,” the PAL official added.
Meanwhile, Gokongwei-led budget carrier Cebu Air, Inc., which operates Cebu Pacific Air and Cebgo, estimated its revenue losses will hit P400 million from the cancellation of 847 flights this week.
“CEB estimates a revenue loss of P400 million from flight cancellations due to the APEC meeting,” Cebu Pacific Corporate Affairs Officer-in-Charge Paterno S. Mantaring, Jr. said in a separate text reply.
“As there may still be further changes in flight schedules within the week, this figure may still change,” he added.
Philippines AirAsia, which canceled 186 plane trips, has yet to release a figure on foregone revenue.
The airlines had to suspend operations after the Civil Aviation Authority of the Philippines declared a “no fly zone” to give way to “special operations” for the arrivals and departures of the heads of states.
The agency also declared restrictions on the movement of general aviation aircraft.
Most of the leaders of the 21 APEC member economies have already arrived in Manila, including United States President Barack Obama and Chinese President Xi Jinping. The two-day APEC summit will begin on Wednesday.
Shares of PAL Holdings fell 2.8% to P4.52 apiece on Tuesday, while Cebu Air shares dropped 0.77% to close at P84.10 apiece.
Source: Daphne J. Magturo, http://www.bworldonline.com