MANILA, Philippines — Lucio Tan’s MacroAsia Corp. incurred a net loss of P1.8 billion last year, a reversal of the P1.19 billion net income posted in 2019, as the pandemic weighed heavily on its aviation-related business units.
Consolidated revenues of the company plummeted to P2.26 billion from P6.17 billion the previous year.
Decline in demand for air travel as a result of the pandemic pulled down the firm’s catering segment revenue by 67 percent to P950.9 million from 2019’s P2.91 billion.
Ground-handling and aviation services revenues also plunged 63 percent to P1.04 billion as flights handled declined 63 percent year-on-year.
Revenues from water operations posted a 36 percent decrease to P221.42 million from P347.6 million on the back of the downturn of commercial water sales in Boracay due to tourism closure, alongside the termination of the bulk water supply contract of SUMMA in Marilao, Bulacan.
MacroAsia said its water businesses in other areas grew significantly, but such growth was not enough to offset the significant drop in billed volume in Boracay and Marilao.
“The group’s aviation-related business units continue to be impacted by the global downturn in air travel due to COVID-19. Being an archipelago, air travel in the Philippines is expected to recover faster, compared to countries without a domestic travel market,” the company said.
MacroAsia said Lufthansa Technik Philippines (LTP), a joint venture with Hamburg-based Lufthansa Technik AG, would continue its facility expansion program in Pasay City by completing the shell of a multi-purpose wide-body hangar this year as it anticipates the return of business volumes to normalcy within the next two years.
“While foreign airline clients have opted to delay their heavy maintenance programs in the midst of this pandemic, it is forecasted that as travel restrictions ease due to the various vaccination programs globally, planes that were grounded will slowly be recalled into operation, thus, increasing the market for potential base repair in 2021 onwards,” the company said.
“The line business, which is essentially airport-flight driven, will follow the airport volume growth in NAIA, Cebu, Clark, and Davao, where LTP operates,” it said.
MacroAsia SATS Food Industries (MSFI), which started operations in March 2019 to support the requirements of the inflight kitchen, is looking to have a significant increase in utilization rate by end of the year as the company was able to establish its presence through various online platforms and launched its own brand.
It is focusing its portfolio growth to cater to more institutional clients, convenience stores, and other players with existing market reach.
As for its water business, MacroAsia said the segment is expected to grow significantly better this year than 2020 as volumes in Boracay Island are slowly returning and its Cavite operations are seen doubling its account portfolio.
In the last two years, MacroAsia has also invested in a digital radio trunking system in several airports, using a frequency that has already been made available by the government to the aviation group.
With the impending completion of regulatory requirements and the commissioning of the network, MacroAsia said this investment would be operational within the first half, which will open new avenues for cost control and revenue growth.
“MacroAsia and its subsidiaries expect to maintain a liquid position as cash flow generation shall be seen to increase from current and new businesses of the group,” the firm said.
“While the group endeavors to fund new investments mostly from internally-generated funds, the robust growth plans may drive the group to avail of debt from bilateral partner banks for major projects in 2021,” it said.
Article and Photo originally posted by Philippine Star last April 15, 2021 12:00am and written by Richmond Mercurio.
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