Start with the basics. For the nine months to September 30, 2025, CEB logged ₱87.6 billion in revenue, up 18% year‑on‑year. Passenger sales rose 17% to ₱59.7 billion on broad‑based demand recovery; cargo accelerated 30% to ₱5.2 billion; and ancillary revenues—those high‑margin add‑ons like baggage, seat selection, and bundles—climbed 17% to ₱22.8 billion. The top‑line story isn’t just about reopening—it’s about retention and monetization.
More telling than growth is quality. Operating costs did rise (+16% to ₱79.8 billion), as you’d expect with more flights and a bigger fleet. But the key heavy lines behaved: flying operations were essentially flat (+1%), thanks to lower fuel prices offsetting higher consumption and crew counts; depreciation (+21%) and aircraft/traffic servicing (+41%) reflect capacity normalization rather than inefficiency; and short‑term lease costs fell sharply (−80%), signposting better asset planning. Net result: operating income of ₱7.8 billion, up 37%.
The best lens for “underlying momentum” is CEB’s pre‑tax core net income, which filters out outsized, non‑recurring items. On that basis, CEB delivered ₱2.9 billion, double last year’s ₱1.45 billion. Pair that with an EBITDA of ₱22.2 billion and a 25.3% EBITDA margin (up from 23.6%), and you see a business extracting more cash profit per peso of revenue even as it rebuilds capacity. Efficiency metrics corroborate the trend: Cost per ASK ticked down to ₱3.05 from ₱3.10, with the seat load factor steady at 84.8%—proof that routes and pricing are holding.
Of course, the reported net income of ₱9.47 billion (+181%) needs context. Two items gave the year a big glow: ₱5.99 billion booked as other income for five free‑of‑charge Pratt & Whitney GTF engines—a fair‑value recognition tied to industry‑wide AOG mitigation—and ₱226 million from remeasurement on the step‑acquisition of 1Aviation (ground handling), which moved from joint venture to subsidiary. These don’t recur, and the market should normalize them. But they also matter: the engines improve near‑term fleet availability, while consolidating 1Aviation strengthens service control and integration. (Source: CEB Form 17‑Q, 9M 2025)
If there’s a headwind, it’s below the line. Financing costs rose 17% to ₱5.6 billion as deliveries and lease liabilities scaled, and foreign‑exchange losses hit ₱1.25 billion on peso depreciation versus USD and JPY—the currency mix in aviation is stubborn. Yet even here, the interest coverage ratio improved to 1.57x (from 1.32x), reflecting stronger earnings capacity to carry debt and leases.
Balance‑sheet optics have turned decisively better. Equity grew to ₱16.1 billion (from ₱10.0 billion), and book value per common share jumped to ₱21.00 (from ₱7.18), driven by profits despite an active buyback and a ₱2.82 billion dividend to preferred shareholders. On liquidity, the current ratio is a low 0.53x, and current liabilities still exceed current assets by ~₱30 billion—that’s the nature of airline working capital. But cash generation is the counterweight: ₱15.41 billion net cash from operations year‑to‑date, ₱4.78 billion net inflows on investing (proceeds and PDP/security‑deposit refunds, net of capex), and deliberate ₱24.46 billion outflows in financing (debt/lease repayments, treasury purchases, dividends). The company is using cash to de‑risk.
Operationally, the platform is deeper and more resilient. CEB now flies 98 aircraft with an average age of ~6.1 years, across 82 domestic and 42 international routes with roughly 2,700 weekly flights. The AirSWIFT acquisition broadens leisure connectivity (El Nido and other tourist nodes), while 1Aviation consolidation tightens ground operations across thirty‑plus airports. Those moves aren’t mere trophies; they reinforce the commercial engine—better schedule reliability, more ancillary throughput, and improved customer experience that sustains yield.
There are risks worth watching. Fuel and FX remain volatile, and hedging is prudently modest; heavy maintenance accruals (₱5.68 billion HMV YTD) and return condition provisions (₱0.83 billion) underline a busy engineering calendar as utilization rises; lease liabilities are substantial (₱116.84 billion), keeping discipline front‑and‑center. Still, the levers are visible: route profitability, ancillary monetization, tighter ground operations, normalized lease mix, and efficiency at scale.
Bottom line: If you’re trying to decide whether CEB’s 2025 bounce is cosmetic or structural, the core tells the story. Pre‑tax core earnings doubled, margins expanded, CASK declined, and cash flows are funding de‑risking, not just growth. The headline numbers benefited from exceptional items, yes—but the business beneath them is sturdier than it was a year ago. For investors, valuation should key off normalized earnings and EV/EBITDA, but the direction of travel is favorable: an airline that’s earning more per flight and per customer, with a wider network, better integration, and improving balance‑sheet optics.
In a sector where momentum can be fleeting, Cebu Air’s looks real—and increasingly repeatable.
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