BUDGET airline Cebu Pacific has no plans to relinquish its foothold in the local aviation market, strengthening its position as the Philippines’s new “eagle.”
Cebu Pacific President Lance Y. Gokongwei said his carrier’s recent rebranding signifies the company’s commitment to further drive growth to the local aviation market and to the Philippines’s tourism sector.
“Our eagle, whose image is emblazoned on all our aircraft, is sleeker, ready to take passengers further,” he said. “That’s just the beginning. Consider it our first step to becoming Cebu Pacific 2.0: bigger, better and much more innovative.”
The low-cost carrier, which is the airline of choice of domestic passengers, now flies to more than 62 domestic and international destinations, mounting 2,200 flights each week as of end-June.
“And while you can expect our fleet to grow with the addition of brand-new aircraft, our network to expand with the unveiling of more destinations and our services to be even more in tune with your travel needs, you can also expect the same warm and fun-filled Cebu Pacific experience,” Gokongwei said.
The aviation company has hiked its capital requirements this year to accommodate its planned fleet-expansion program set until 2021, the company’s big wig said on late Wednesday.
Gokongwei said his group is spending roughly $280 million in capital expenditures this year, an amount that is 12 percent higher than the $250 million spent last year.
“This year’s capital is quite substantial at about $280 million. It’s primarily for the acquisition of four Airbus A320s, as well as predelivery payments on our upcoming ATRs and A321 neos,” he said.
The airline has ordered P30.31 billion worth of turboprops from European airplane manufacturer ATR.
The transaction involves the delivery of 16 ATR72-600—with the option to acquire 10 more of the same kind of plane—by the third quarter of 2016.
This effectively doubles Cebu Pacific’s turboprop fleet size, subject to the execution of final purchase documentation.
The order is part of Cebu Pacific’s fleet-renewal program. Cebu Pacific currently operates a fleet of eight ATR 72-500 aircraft, which will be retired as the new aircraft enters service. The entry into service of the ATR 72-600 will see Cebu Pacific with new generation aircraft to meet growing demand in the Philippines for inter-island services.
The ATR 72-600 ordered by Cebu Pacific will be equipped, for the first time, with the high-density Armonia cabin, the widest cabin in the turboprop market. It will be equipped with 78 slim-line seats and wider overhead bins with 30 percent more stowage space. These new technological innovations further enhance space and comfort for passengers. So far, the low-cost carrier has spent about $75 million of the planned capital.
Cebu Pacific has set an 18-million-passenger target this year, or about 6.5 percent higher than the 16.9 million passengers booked last year.
Cebu Air Inc. booked a net income of P2.2 billion in the first three months of 2015, over 13 times higher than the P164.2 million recorded during the same period the year prior.
The group’s revenues during the first quarter soared by 21 percent to P14.2 billion, as earnings from passenger operations grew by 22 percent to P10.8 billion and cargo by 14 percent to P772.5 million. Revenues from ancillary services went up by a robust 17 percent to P2.6 billion due to improved online bookings and an expanded roster of ancillary revenue products and services.
Recent decline in fuel prices also contributed to the significant improvement in net income, as Cebu Pacific total fuel cost for the first quarter was reduced by 22 percent to P4.32 billion, from P5.55 billion expended in the same period last year.
Cebu Pacific has a 55-strong fleet, composed of 10 Airbus A319, 31 Airbus A320, six Airbus A330 and eight ATR 72-500 aircraft.