Philippine Airlines (PAL) on Friday reported a 51-percent decrease in net income last year, citing reduced revenue and increased operating costs.
The airline unit of tycoon Lucio Tan posted a net income of $151.1million (P10.22 billion) in 2024, down from $379 million (P21 billion) in 2023.
PAL generated revenues of $3.13 billion (P179.67 billion), a 4-percent reduction from the $3.25 billion (P180.73 billion) logged in 2023.
Passenger revenues declined by 6 percent from $2.87 billion to $2.70 billion, while cargo and ancillary revenues registered a healthy increase of 12 percent to $159.7 million and 16 percent to $271.7 million, respectively.
The fourth quarter of 2024 showed an 8 percent increase in systemwide revenues to $790.2 million compared to $733 million in the third quarter.
This marked PAL’s 13th straight profitable quarter that reflects disciplined cost management, sustained passenger demand, and strategic network expansion, reinforcing its position as one of the region’s most resilient full-service air carriers.
“We are very pleased with the solid financial performance achieved by the Philippine Airlines team, an outcome of greater operational efficiency, improved schedule reliability, and more consistent service across our global network,” PAL president and chief operating officer Stanley Ng said.
“In 2024, PAL operated 5 percent more flights while improving on-time-performance by 2 percent and schedule reliability by 4 percent. These gains contributed to a significant increase in customer satisfaction (CSAT) scores, which rose to 73 percent, and net promoter scores (NPS), which reached +43, both ranking among the strongest results we’ve delivered to date,” he said.
PAL carried 15.6 million passengers in 2024, or 6 percent higher than in 2023, while mounting a total of 110,867 flights systemwide, a 5 percent increase from the 105,294 flights operated in 2023.
The calibrated expansion of PAL’s network included the launching of Manila-Seattle nonstop flights last October, PAL’s first new U.S. route in nine years, along with progressive increases in frequencies on various international and domestic routes.
The incremental growth in passenger carriages and solid financial performance came despite a general moderation of growth rates, inflationary strains and increased competition that put pressure on yields.
Total operating expenses increased by 3 percent to $2.82 billion (P161.59 billion) from $2.75 billion (P152.99 billion) in 2023 due to higher lease costs and airport charges, although these were offset by lower fuel expenses and more effective cost-management measures. Fuel remains the largest cost item, representing 31 percent of revenues.
PAL incurred capital expenditures of $387.7 million in 2024 largely for the purchase of its new aircraft and aircraft maintenance.
The airline is also embarking on a number of digital transformation projects such as the implementation of a SalesForce Customer Relationship Management (CRM) platform, RAMCO Maintenance Information System and SAP’s S4Hana Enterprise Resource Planning system.
The ongoing digital transformation is a key strategy for PAL to deliver personalized digital experiences across the customer journey.
“PAL’s financial discipline is critical in a very cyclical industry. Enabled by the gains we have made post-restructuring, we are making purposeful investments to improve our product and update our systems with the aim of delivering better service to our passengers more efficiently,” said PAL chief financial officer Anna Bengzon.
PAL said it is gearing up for the planned delivery of nine Airbus A350-1000 long-range aircraft and 13 A321neo regional aircraft in the coming years.
Efforts are also underway to reconfigure the A321ceo cabins and enhance WIFI and in-flight entertainment (IFE) systems.