CEB Investors' and Analysts' Briefing 2Q11 - Cebu Pacific Air

Cebu Air, Inc. (CEB)
2Q2011 Results of Operations
Investors’ and Analysts’ Briefing
August 2011
Strictly Private and Confidential

Disclaimer
This information provided in this presentation is provided only for your reference. Such information has not been independently verified and, as such, is not guaranteed to
be accurate nor complete. Neither Cebu Air, Inc. (“CEB” or the “Company”) nor any of its affiliates, shareholders, directors, employees, agents or advisers makes
expressed or implied representations or warranties as to the accuracy or completeness of the information contained herein and neither of them shall accept any
responsibility or liability (including any third party liability) for any loss or damage, whether or not arising from any error or omission in compiling such information or as a
result of any party’s reliance or use of such information. The information and opinions in this presentation are subject to change without notice.
EBITDAR, EBITDA, EBITDAR Margin, EBIT and core net income are not measures of performance under the Philippine Financial Reporting Standards (“PFRS”), and
should not be considered in isolation or as alternatives to net income as an indicator of CEB’s operating performance or to cash flow from operating, investing and
financing activities as a measure of liquidity, or any other measures of performance under PFRS. Because there are various EBITDAR, EBITDA, EBITDAR Margin, EBIT
and core net income calculation methods, CEB’s presentation of these measures may not be comparable to similarly titled measures used by other companies.
This presentation also contains certain “forward-looking statements.” These forward-looking statements include words or phrases such as CEB or its management
“believes”, “expects”, “anticipates”, “intends”, “plans”, “foresees”, or other words or phrases of similar import. Similarly, statements that describe CEB’s objectives, plans
or goals are also forward-looking statements. All such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ
materially from those contemplated by the relevant forward-looking statement. Such forward looking statements are made based on management’s current expectations
or beliefs as well as assumptions made by, and information currently available to, management. There is no assurance that expected events will occur, that projections
will be achieved, or that the Company and its management’s assumptions are correct.

Quarter Highlights
1
2
14.8% traffic growth
88.6% load factor
44.6% domestic
market share
8
Php12.4 billion
cash 2
1.08x adjusted
net D-E ratio
3
21.0% international
passenger growth
7
26.7% EBITDAR
margin
14.5% pre-tax core
net income margin
4
14.3 block hours/day 1
8.3 turns/day
6
5.3% reduction in
cost ex-fuel per ASK
5
2.6% increase in total
revenue (ex-cargo)
per passenger
Note: All figures are for 2Q2011; growth figures are 2Q2011 year-on-year comparison
1Average utilization for Airbus fleet only
2Includes financial assets at FVPL and available-for-sale investments
3

What’s In Store?
Business Updates Financial Results Looking Ahead

1. Business Updates

Load Factors Hit All-Time High
CEB posted record seat load factors of 88.6% in 2Q2011 and 87.8% in 1H2011.
Total passenger volume grew 14.8% YoY in 2Q2011 and 13.4% YoY in 1H2011, led by the international
segment.
Load
Factor
80.9% 78.0% 77.4%
85.4% 85.4%
87.8% 88.2%
88.6%
(m)
10.5
9.0
7.5
6.0
4.5
3.0
1.5
CAGR: 24.4%
6.7
5.4 1.4
1.0
5.3
4.4
8.7
1.6
7.1
10.4
2.2
8.2
YoY Growth:
13.4%
5.2
1.1
5.9
1.4
4.1 4.5
YoY Growth:
14.8%
2.7
0.6
3.1
0.7
2.1 2.4
2Q11 Y-o-Y Growth
Passengers 14.8%
Domestic 13.1%
International 21.0%
Seats 14.2%
Domestic 10.5%
International 28.2%
1H2011 Y-o-Y Growth
Passengers 13.4%
Domestic 10.1%
International 26.0%
Seats 10.2%
Domestic 5.5%
International 28.1%
-
2007 2008 2009 2010 1H10 1H11 2Q10 2Q11
6
Domestic
International

Sustained Domestic Market Leadership
CEB continues to dominate the domestic air travel market
Domestic
Passengers 1
(‘000)
3,49
9
3,881 3,655 4,289 3,887 4,573 4,510 5,148
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
1.3% 0.7% 1.5% 0.8% 1.8% 1.0% 1.4% 1.0%
6.5% 7.4% 5.8% 7.6% 6.5% 11.3% 8.1% 12.1%
40.9% 31.3% 38.6% 28.3% 36.0% 25.6% 32.9% 23.7%
1.9% 11.7% 2.4% 17.0% 5.2% 19.5% 10.3% 18.6%
49.5% 48.9% 51.7% 46.3%
50.6%
42.6%
47.3% 44.6%
3Q09 3Q10 4Q09 4Q10 1Q10 1Q11 2Q10 2Q11
CEB AirPhil Express PAL Zest Air Seair
In 2Q2011, CEB remains
the no.1 domestic carrier
with a market share of
44.6%.
CEB maintains a CPI (2) of
1.04, higher than all of its
domestic competitors.
CEB will take 7 aircraft in
the next 7 months,
outpacing growth plans
of other domestic carriers
Source: Civil Aeronautics Board, Company data.
(1) Passenger numbers include CEB’s non-revenue passengers and excludes no-shows. Figures should not be compared with CEB’s
internal passenger count..
(2) CPI (Competitive Performance Index ) is computed by dividing market share by capacity share
7

Growing Share in Robust International Market
CEB gaining international market share
International
Passengers 12,542 14,013 3,441 3,832
(‘000) (1)
100.0%
80.0%
40.3% 38.7% 38.0% 40.8%
CEB grew its international
segment by 21.0% YoY in
2Q2011 as ASEAN and North
Asia destinations continue to
show robust demand.
60.0%
40.0%
20.0%
0.0%
4.2% 4.2% 5.0%
4.1%
4.6% 4.7% 5.2% 4.2%
9.6%
11.0%
10.1% 9.0%
27.0%
28.1% 27.6% 26.3%
12.9% 14.7% 14.1% 15.8%
FY 2009 FY 2010 1Q2010 1Q2011
Based on official data CEB
captured 15.8% international
market share in 1Q2011.
CEB has been gaining traction
in the international market since
2009, while market shares of
top competitors have been
contracting.
CEB Philippine Airlines Cathay Pacific Singapore Airlines Asiana Others (2)
Source: Civil Aeronautics Board, DMIA (for carriers with Clark operations) .
(1) Passenger numbers include CEB’s non-revenue passengers and excludes no-shows.
(2) Others include 36 other airlines each with market share not higher than 4%
8

Revenue Growth Outpaces Traffic Growth
CEB’s total revenue growth and breakdown
18.00
15.00
YoY Growth:
12.1% 16.73
14.92
Total revenues increased 16.3%
YoY in 2Q2011, faster than traffic
growth of 14.8%.
12.00
9.00
6.00
3.00
-
(Php billion)
1H10 1H11 2Q10 2Q11
Cargo Revenue 1.00 0.96 0.52 0.50
Ancillary Revenue 1.03 1.90 0.54 1.15
Pax Revenue 12.89 13.87 6.85 7.56
Pax Revenue Ancillary Revenue Cargo Revenue
YoY Growth:
16.3% 9.21
7.92
Average
Fare (Php) 2,469 2,343 2,528 2,431
Ancillary
Revenue per
Pax (Php)
Total Rev
(ex-Cargo)
per Pax (Php)
198 321 200 368
2,667 2,664 2,728 2,799
CEB has successfully unbundled
and improved take up of ancillary
products and services. Ancillary
revenue per passenger
increased significantly by 83.9%
YoY to Php368 in 2Q2011.
Fuel surcharges began to impact,
slowing down YoY decline in
average fares to 3.8% in 2Q2011
from 6.6% in 1Q2011.
Cargo revenues down 4.1% YoY
due to lower volumes in 2Q2011
compared to 2Q2010 base
period which was high due to
national elections.
9

Effective Marketing and Distribution Network
Breakdown of sales by distribution channel
100.0%
Success in increasing online presence and proportion of web bookings
80.0%
44.1% 40.6% 36.1%
29.9%
60.0%
40.0%
22.2% 25.4%
22.2%
22.0%
20.0%
33.8% 34.0%
41.7%
48.1%
0.0%
2008 2009 2010 1H2011
Internet Booking CEB Ticket Offices and Call Centers Third Party Sales Agents
Sales made through the CEB website has significantly increased. In 1H11, the share of web bookings to
total sales reached 48.1%.
CEB continues to increase on-line presence through Facebook and Twitter
CEB will further strengthen brand equity through co-branding arrangements
10

Constantly Improving Operational Efficiency
2Q2010 2Q2011 %Change 1H2010 1H2011 %Change
No. of Sectors Flown 22,358 24,816 11.0% 43,844 47,310 7.9%
Domestic 18,534 19,972 7.8% 36,168 37,601 4.0%
International 3,824 4,844 26.7% 7,676 9,709 26.5%
ASK (millions) 2,562 3,136 22.4% 5,101 6,076 19.1%
Domestic 1,346 1,513 12.4% 2,668 2,864 7.3%
International 1,216 1,623 33.5% 2,433 3,213 32.0%
RPK (millions) 2,272 2,722 19.8% 4,368 5,214 19.4%
Domestic 1,203 1,378 14.6% 2,322 2,580 11.1%
International 1,069 1,344 25.7% 2,046 2,633 28.7%
Ave. Daily Aircraft Utilization (Block Hours) 12.62 13.25 5.0% 12.44 12.95 4.1%
Airbus 13.89 14.32 3.1% 13.85 13.96 0.8%
ATR 9.30 9.92 6.7% 8.73 9.63 10.3%
Ave. Turns per Day 8.47 8.26 -2.5% 8.35 8.06 -3.5%
Airbus 8.21 7.95 -3.2% 8.22 7.73 -6.0%
ATR 9.16 9.23 0.8% 8.69 9.12 4.9%
On-Time Performance (OTP) 87% 71% (16.5) 89% 76% (13.8)
11

2. Financial Results

Resilient Profits Amidst Tough Business Environment
For the Quarter Ended For the Six Months Year-on-Year Change
30-Jun-10 30-Jun-11 30-Jun-10 30-Jun-11 1Q2011 2Q2011 1H2011
Passengers ('000) 2,712 3,112 5,219 5,918 11.9% 14.8% 13.4%
Total Revenue (Php m) 7,918 9,210 14,920 16,730 7.4% 16.3% 12.1%
Average Fare (Php) 2,528 2,431 2,469 2,343 -6.6% -3.8% -5.1%
Ancillary Revenue per Passenger (Php) 200 368 198 321 37.1% 84.3% 62.1%
EBITDAR (Php m) 3,040 2,460 5,424 4,237 -25.4% -19.1% -21.9%
EBIT (Php m) 2,147 1,394 3,646 2,135 -50.6% -35.1% -41.4%
Net Income (Php m) 1,609 1,239 3,166 2,440 -22.9% -23.0% -22.9%
Pre-tax Core Net Income (Php m) 1,957 1,339 3,231 2,010 -47.4% -31.6% -37.8%
EBITDAR Margin 38.4% 26.7% 36.4% 25.3% -10.4 -11.7 -11.0
EBIT Margin 27.1% 15.1% 24.4% 12.8% -11.6 -12.0 -11.7
Net Income Margin 20.3% 13.5% 21.2% 14.6% -6.3 -6.9 -6.6
Pre-tax Core Net Income Margin 24.7% 14.5% 21.7% 12.0% -9.3 -10.2 -9.6
CEB delivered comfortable margins in 2Q2011 despite continued rise in jet fuel prices to an average of
US$130.76/bbl (published MOPS) in 2Q2011, 45.5% higher YoY.
EBITDAR margin and pre-tax core net income margin were at 26.7% and 14.5%, respectively, in 2Q2011;
25.3% and 12.0%, respectively in 1H2011.
13

Continued Efforts to Lower Unit Cost
hp - Cost per ASK
For the Quarter Ended For the Six Months Ended Year-on-Year Change
30-Jun-10 30-Jun-11 30-Jun-10 30-Jun-11 2Q2011 1H2011
lying Operations 1.149 1.461 1.108 1.351 27.2% 21.9%
Fuel 0.989 1.295 0.947 1.201 30.9% 26.8%
Others 0.160 0.166 0.161 0.150 3.9% -6.7%
aintenance 0.218 0.194 0.220 0.197 -11.0% -10.2%
epreciation and Amortization 0.195 0.209 0.195 0.211 7.1% 8.2%
ircraft and Traffic Servicing 0.261 0.241 0.261 0.247 -7.8% -5.4%
ircraft and Engine Lease 0.154 0.131 0.153 0.135 -14.7% -12.1%
eservation and Sales 0.134 0.117 0.130 0.123 -12.4% -5.8%
assenger Service 0.062 0.061 0.062 0.062 -0.9% -0.2%
eneral and Administrative 0.071 0.063 0.073 0.064 -11.4% -12.9%
ther Expenses 0.009 0.014 0.007 0.012 67.7% 77.0%
otal Cost per ASK 2.253 2.492 2.210 2.402 10.6% 8.7%
otal Cost per ASK ex- Fuel 1.264 1.197 1.263 1.201 -5.3% -4.9%
otal Cost per ASK (in US$ cents) 4.948 5.763 4.828 5.519 16.5% 14.3%
otal Cost per ASK ex- Fuel (in US$ cents) 2.776 2.769 2.759 2.760 -0.3% 0.0%
ote: Converted based on average exchange rate for the period: 2Q2011 at Php43.24/US$, 2Q2010 at Php46.53/US$, 1H2011 at Php43.52/US$, 1H2010 at Php45.77/US$
Unit cost increased 10.6% YoY in 2Q2011 and 8.7% YoY in 1H11 primarily due to higher fuel prices
Cost per ASK ex-fuel dropped 5.3% YoY in 2Q2011 and 4.9% YoY in 1H11 .
14

Summary of Income Statement
15
For the Quarter Ended For the Six Months Ended
Year-on-Year Change
Php Millions
30-Jun-10 30-Jun-11 30-Jun-10 30-Jun-11 2Q2011 1H2011 2Q2011 1H2011
% Revenue
Passenger Revenue 6,854 7,564 12,885 13,865 10.4% 7.6% 82.1% 82.9%
Cargo Revenue 522 500 1,000 963 -4.1% -3.7% 5.4% 5.8%
Ancillary revenue 542 1,146 1,034 1,902 111.5% 83.8% 12.4% 11.4%
Total Revenue 7,918 9,210 14,920 16,730 16.3% 12.1%
% Operating Cost
Flying Operations 2,942 4,582 5,653 8,210 55.7% 45.2% 58.6% 56.2%
Fuel 2,533 4,061 4,831 7,296 60.3% 51.0% 52.0% 50.0%
Others 409 521 822 913 27.2% 11.1% 6.7% 6.3%
Maintenance 559 609 1,120 1,197 9.0% 6.9% 7.8% 8.2%
Depreciation and Amortization 500 655 996 1,284 31.1% 28.9% 8.4% 8.8%
Aircraft and Traffic Servicing 670 755 1,333 1,501 12.8% 12.6% 9.7% 10.3%
Aircraft and Engine Lease 394 411 782 819 4.4% 4.7% 5.3% 5.6%
Reservation and Sales 343 368 664 745 7.3% 12.2% 4.7% 5.1%
Passenger Service 159 193 317 376 21.4% 18.9% 2.5% 2.6%
General and Administrative 182 198 374 388 8.5% 3.8% 2.5% 2.7%
Other Expenses 22 45 36 75 105.3% 110.8% 0.6% 0.5%
Total Operating Expenses 5,770 7,816 11,273 14,595 35.4% 29.5%
% Revenue
EBIT 2,147 1,394 3,646 2,135 -35.1% -41.4% 15.1% 12.8%
Fuel hedging gains / (losses) -6 -64 8 560 933.7% 6678.3% -0.7% 3.3%
Fair value gains / (losses) 0 11 0 -13 nm nm 0.1% -0.1%
Foreign exchange gains / (losses) -430 88 -68 187 nm nm 1.0% 1.1%
Interest expense - net -200 -63 -429 -142 -68.5% -66.8% -0.7% -0.8%
Equity in net income (loss) of a JV 10 8 14 17 -16.4% 23.0% 0.1% 0.1%
Provision for Tax -88 135 5 303 nm 6139.8% 1.5% 1.8%
Net Income / (Loss) after Tax 1,609 1,239 3,166 2,440 -23.0% -22.9% 13.5% 14.6%
Pre-Tax Core Net Income 1,957 1,339 3,231 2,010 -31.6% -37.8% 14.5% 12.0%

Strong Balance Sheet Allows for Further Expansion
Php Millions
As of Dec-31 As of Jun-30
2010 2011
Cash and cash equivalents (1) 13,267 12,391
Current assets 15,139 14,366
Plant and equipment 33,986 36,623
Other noncurrent assets 812 1,063
Total assets 49,937 52,052
Total debt (2) 20,503 20,794
Other liabilities 11,527 12,906
Total liabilities 32,030 33,699
Cash balance (including financial
assets at FVPL) after cash
dividend payout stood at Php12.4
billion as at end 2Q2011.
Strong gearing and debt service
ability allow CEB to tap financing
for aircraft acquisition.
Total equity 17,907 18,353
Capitalized lease (3) 11,234 11,490
Net debt 7,236 8,403
Adjusted net debt 18,470 19,893
Net debt-to-equity (x) 0.40 0.46
Adjusted net debt-to-equity (x) 1.03 1.08
Adjusted net debt/EBITDAR (x) (4) 1.82 2.22
Cash-to-sales ratio (5) 45.6% 40.1%
(1) Cash balance includes financial assets held-for-trading (at fair value) as well as available for sale assets.
(2) Includes LT debt, current portion of LT debt, and ARO liability
(3) Capitalized lease for June 30, 2011 is based on LTM aircraft and engine lease expense x7
(4) EBITDAR for June 30, 2011 is based on LTM EBITDAR
(5) Sales for June 30, 2011 is based on LTM Revenues
16

3. Looking Ahead

Taking Fleet Expansion Forward
Disciplined and flexible fleet expansion plan
48 49
37 41
11 7
29 32
8
8
9 9
11
11
8 8 8
8
12 15 18 22 29 34
2009 2010 2011 2012 2013 2014
Airbus under Finance Lease ATR under Finance Lease Airbus under Operating Lease
Ave. fleet age (1)
3.5 years
Notes: (1) As of 30 June 2011
Added 2 Airbus A320 aircraft under operating leases for delivery in 2012.
Exercised option to purchase 7 Airbus A320 aircraft for delivery in 2015 and 2016.
Placed order for 30 Airbus A321neo aircraft for delivery from 2017 to 2021.
Mandate given for the financing of the next three Airbus A320 aircraft for delivery between September
2011 and January 2012
18

Thank you.

Appendix

Summary of Balance Sheet
Php Millions
As of Dec-31 As of Jun-30
2010 2011
Cash and cash equivalents 9,763 8,942
Financial assets at fair value through profit or loss 3,879 3,870
Receivables 862 720
Expendable parts, materials and supplies 370 497
Prepaid expenses and other current assets 264 339
Current Assets 15,139 14,366
Property and equipment-net 33,986 36,623
Available for sale 115 112
Investment in a joint venture 370 386
Other noncurrent assets 328 564
Total Noncurrent Assets 34,798 37,686
Total Assets 49,937 52,052
Accounts payable and accrued expenses 5,598 6,319
Due to related parties 36 36
Current portion long-term debt 2,056 2,157
Unearned transportation revenue 4,606 5,019
Current Liabilities 12,296 13,531
Long term debt-net of current portion 16,377 16,473
Other noncurrent liabilties 3,357 3,695
Total Noncurrent Liabilties 19,734 20,168
Total Liabilities 32,030 33,699
Paid-up capital 613 613
Additional paid-up capital 8,406 8,406
Treasury stocks -159
Net unrealized gain (loss) on AFS investment -3 -5
Retained earnings 8,891 9,497
Equity 17,907 18,353
21
Total Liabilities and Equity 49,937 52,052

Summary of Cash Flows
Php Millions
For the Six Months
30-Jun-10
30-Jun-11
CASHFLOWS FROM OPERATING ACTIVITIES
Income (loss) before income tax 3,171 2,743
Net adjustments 1,449 648
Operating income before working capital changes 4,620 3,392
Net changes in working capital 1,200 1,056
Net cash generated from operations 5,820 4,447
Interest paid -413 -350
Interest received 34 329
Net cash provided by operating activities 5,440 4,426
CASHFLOWS FROM INVESTING ACTIVITIES
Decrease (increase) in:
Advances to a related party -3,663 0
Acquisition of property and equipment -530 -1,968
Other noncurrent assets -76 -237
Net cash used in investing activities -4,269 -2,204
CASHFLOWS FROM FINANCING ACTIVITIES
Increase (decrease) in:
Repayments of long term debt -922 -1,042
Payment of treasury shares of stock 0 -159
Cash dividends 0 -1,834
Net cash provided by financing activities -922 -3,034
NET FOREIGN EXCHANGE DIFFERENCE -7 -10
NET INCREASE (DECREASE) IN CASH AND CASH 242 -822
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 3,841 9,763
CASH AND CASH EQUIVALENTS AT END OF PERIOD 4,083 8,942
22

Increased Capacity in the Philippine Market
Aggressive expansion plans announced by local competitors
Notes:
1 Estimates based on industry sources and press releases of local carriers
23