Flag carrier Philippine Airlines (PAL) is now in the "final stage" of its comprehensive restructuring, as the losses of parent PAL Holdings mounted to P73 billion in 2020.
In a disclosure on Thursday, June 17, PAL Holdings said its losses ballooned seven times from P9.7 billion in 2019, and 2020 was the fourth straight year it sank into the red.
Expenses were drastically reduced by 46% to P81.8 billion year-on-year, but this was not enough to cushion the 64% dive to P55.3 billion in revenues brought by pandemic restrictions.
From January to December 2020, revenues from passenger flight operations shrunk by two-thirds to P41.86 billion, while cargo revenues inched up to P9.41 billion.
Recovery appears to be far off for PAL as it posted an P8.58-billion net loss from January to March 2021. But it said on Thursday that financial restructuring will soon be completed.
"To complete the recovery, PAL management and stakeholders are working on the final stages of a comprehensive restructuring plan that will enable the airline to emerge financially stronger from the current global crisis," said PAL Holdings in a statement.
"We are confident that the restructuring will enable PAL to strengthen its capital structure, meet stakeholder obligations, and position the company for long-term success," it added.
According to the financial statement, PAL's plans include rationalization of routes by discontinuing "ultra-long-haul routes," altering select aircraft to accommodate the expected increase in passenger demand when travel confidence returns, and reduction of manpower.