Philippine Airlines (PR, Manila Ninoy Aquino International) has received a cash injection of at least PHP15.2 billion pesos (USD299 million) courtesy of billionaire Lucio Tan, its chairman and chief executive, whose holding company LT Group has a majority stake in the carrier's parent PAL Holdings.
PAL president Gilbert Santa Maria told ABS-CBN News on May 21 that a third of the capital infusion, about PHP5 billion (USD98.5 million), had already been deployed this year to keep the carrier afloat during the Covid-19 pandemic.
PAL is “not in immediate danger of bankruptcy” for now, but “without that liquidity, Philippine Airlines would probably not be here anymore,” Santa Maria said. “We are hanging on. We are waiting to fulfil our mission as the flag carrier.”
Expected to exit the country's strict lockdown at the end of this month having lost USD1 billion, the airline is not considering any further job cuts after dismissing 5% of its workforce - about 300 employees - in February, Santa Maria said.
PAL Holdings last week posted a full-year net loss of PHP10.3 billion (USD203 million) for 2019, its third straight year of losses, which the company blamed partly on the adoption of a new accounting standard. It posted an operating profit, however, of PHP2.87 billion (USD56.5 million), reversing the previous year’s operating loss.
“The reality is that demand is probably not going to recover for about two years, so we will have an excess of employees. The question is going to be what the trajectory of the recovery will be,” he added.
Philippine Airlines foresees reopening in June with up to 10% of its international capacity - including Los Angeles International, San Francisco, and Singapore Changi - and 20% to 30% of domestic flights in operation, according to Santa Maria.
