Philippine Airlines’ Loss Widens As Work Stoppages Take Toll

International Herald Tribune
Wednesday, September 2, 1998
NASDAQ
By The Associated Press

MANILA — Philippine Airlines, which has been devastated by recent strikes, said Tuesday its first-quarter loss had widened to 2.2 billion pesos ($49.7 million), mainly because of work stoppages.

A year earlier, the airline posted a loss of 502.9 million pesos.

Company executives said a 22-day strike by pilots in June dealt the heaviest damage, canceling two-thirds of the airline's flights and causing revenue losses of about 200 million pesos a day.

The airline said its losses also rose because of soaring dollar-denominated payments and continuing lease payments on unused planes, which have not yet been returned.

In a financial report submitted to Manila's Securities and Exchange Commission, the airline said its liabilities increased to 26.67 billion pesos in the first quarter which started in April, from 9.83 billion pesos in the preceding quarter.

The airline is seeking to restructure its debts and has obtained permission to suspend $2 billion in payments to domestic and international creditors while it prepares a rehabilitation plan.

• Tata Drops Air Plans

Tata Group, India's biggest conglomerate, has abandoned plans to start a domestic airline and blamed the government for delaying approval, Bloomberg News reported from Bombay.

Last year, the government banned a joint venture between Tata and Singapore Airlines Ltd. Tata then applied to start an airline alone but politicians expressed concern that foreign airlines would have indirect control of the company.