“We don’t anticipate staying in the Chapter 11 process for very long. We will likely be out before the end of the year. Once we exit, we’re done. We will have a lighter balance sheet. We will have new capital, and our cost structure will be a lot lighter,” PAL president and COO Gilbert Santa Maria said in a virtual briefing.
Santa Maria, however, said demand would not return to pre-pandemic level until l 2024 or 2025. For this year, he sees PAL revenues accounting for a third of the pre-pandemic level in 2019.
Last Saturday, PAL filed for bankruptcy protection in the US, paving the way for the restructuring of its contracts and the reduction of debt by at least $2 billion with the infusion of $655 million in fresh capital from Tan as well as new investors.
Under the plan, PAL will slash fleet capacity by 25 percent.
Santa Maria said over 118 investors were invited to participate in the airline’s fund raising program. “These potential investors are looking at it. There was a general interest in continuing to support PAL,” he said.
According to Santa Maria, European manufacturer Airbus agreed to delay delivery of 13 narrow-body aircraft as well as cancel some orders beyond 2026 to 2030.
Apart from this, Santa Maria said PAL would return 22 planes to lessors, leaving the flag carrier with 70 aircraft.
PAL incurred P18.04 billion in losses in the first half, 18 percent lower than the previous year as revenues plunged by 51 percent to P18.04 billion due to the prolonged COVID-19 pandemic.