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Cebu Pacific reports big full year profit; airberlin forecasts return to profitability

Philippine LCC Cebu Pacific reported a full-year 2010 operating profit of USD147.6 million and net profit of USD158.4 million, more than doubling its results from 2009. The carrier's passenger numbers rose 19.5% while revenue increased 25%. Shares in Cebu Pacific eased 0.1% yesterday, on a generally strong day for LCC shares, particularly in Europe.

Virgin Blue and AirAsia both made strong share gains, up 3.2% and 5.1%, respectively, while shares in Spanish LCC Vueling spiked 5.3%. Shares in UK and Irish -isted carriers bounced back as well.

Cebu Pacific financial highlights for the 12 months ended 31-Dec-2010:

  • Revenue: USD665.7 million*, +24.8% year-on-year;
    • Ancillary: USD53.5 million, +10.1%;
  • Operating costs: USD518.1 million, +12.4%;
    • Fuel: USD224.4 million, +33.3%;
  • Operating profit: USD147.6 million, +103.9%;
  • EBITDAR margin: 34.9%, +5.7 ppts;
  • Net profit: USD158.4 million, +112.5%;
  • Passenger numbers: 10.5 million, +19.5%;
    • International: 2 million, n/a;

* Based on the conversion rate USD1 = PHP43.7

airberlin CEO Joachim Hunold predicted a return to profitability in 2011 as economic growth, a decline in unemployment and increasing demand for business travel boost passenger numbers. The carrier is forecasting a positive EBIT result in 2011 with the CEO noting that the carrier plans to counter EUR180 million in higher fuel costs in 2011 with increased surcharges and a EUR100 million saving plan. Shares in the carrier eased 0.3% yesterday.

Selected PEA daily share price movements (% change): 24-Mar-2011