PAL Holdings’ Operating Expenses Jump 23.5% to 154.18 Billion Pesos
Key Facts
Operating expenses at PAL Holdings, the parent company of Philippine Airlines, rose 23.5% to 154.18 billion pesos in the first nine months of 2026 from the same period a year earlier, according to a disclosure published by StockBayan. The sharpest increase was in fuel and oil, with expenses climbing 49.8% to 62.04 billion pesos. The figures put fuel costs at the forefront of the group’s operating pressures during the period. The nine-month data cover the parent company and are reported in local currency, while the first-half figures published by the airline itself relate to a different period and entity. Together, the results show the pressure on the business while keeping the scope and period of each figure clear.
In its first-half results, Philippine Airlines said revenue rose 5.9% to 1.746 billion dollars from the first half of 2025, but the company posted a net loss of 25.1 million dollars after reporting net income of 136.7 million dollars a year earlier. The divergence between revenue growth and a swing to a loss highlights the effect of higher costs on the bottom line. The company said fuel expenses rose 48.2% year over year to 674.5 million dollars in the six months. The annual increase in fuel expense was 219.5 million dollars, which the company attributed to the conflict in the Middle East. In its statement, the company said the 219.5 million dollar increase in fuel expense was "driven by the conflict in the Middle East."
The pressure extended to earnings before interest, taxes, depreciation and amortization, which came to 271 million dollars in the first half of 2026, down 28.5% from the same period a year earlier. The margin on those earnings fell to 15.5% from 23.0% in the first half of 2025. The indicators show that higher revenue did not prevent a decline in operating profitability, amid the increase in fuel expenses reported by the company for the same period. Passenger numbers also fell 3.1% to 8.2 million in the first six months of the year. The load factor declined to 78.9% from 81.6% a year earlier, according to company data.
The second quarter of 2026 was the most difficult quarter in the published figures, with PAL recording a net loss of 103.6 million dollars, compared with net income of 60.2 million dollars in the second quarter of 2025. Fuel costs for the quarter rose to 422.9 million dollars, up 88.2% year over year. This quarterly comparison details the period that contributed to the first-half result, but does not represent the parent company’s nine-month results. Cash on hand stood at 456.3 million dollars on June 30, 2026. The company said free cash flow was positive at 135 million dollars, while capital expenditures totaled 153 million dollars in the first half.
PAL Holdings shares rose 0.25% to 3.990 pesos on November 4, 2026, compared with the previous session’s close of 3.980 pesos, according to Investing.com data. The daily change was modest relative to the increases in operating and fuel expenses reported in the nine-month disclosure, and did not alter the published financial figures. Philippine Airlines said it had taken steps to mitigate the impact of higher fuel prices through targeted fare and capacity adjustments on some routes. The adjustments covered domestic, Middle Eastern and regional routes, while the company kept its long-haul international network largely stable. These measures represent the company’s stated response to fuel cost pressures, after it attributed the first-half increase in those expenses to the conflict in the Middle East.