MacroAsia Profit Falls 34 Percent as NAIA Lease Costs Surge

Lease Hike and Contract Loss Hit Bottom Line

MacroAsia Corp. reported a 34 percent decline in net income for the first half of 2026, falling to P449.6 million from P679.7 million a year earlier. The aviation services company attributed the drop to cost pressures at its largest contributor, Lufthansa Technik Philippines (LTP), which faced both higher lease rates at Ninoy Aquino International Airport and the termination of a significant maintenance contract.

Net share from associates decreased 25 percent to P456.1 million during the January-to-June period. LTP's equity contribution to MacroAsia fell 24 percent to P411.2 million as the maintenance, repair and overhaul provider grappled with a new lease agreement at NAIA that imposed steeper rental rates. The company also discontinued line maintenance services at the airport after Philippine Airlines, a long-standing client, shifted to in-house capabilities.

Core Revenue Streams Hold Steady

Despite the profit contraction, MacroAsia grew consolidated revenue nine percent to P5.26 billion, driven by strength in its primary business lines. In-flight catering revenue climbed 12 percent to P2.63 billion, while ground handling services generated P2.25 billion, up eight percent. Passenger and cargo handling volumes rose two percent during the period.

The company's non-aviation segments also posted gains. Water operations revenue reached P369 million, supported by a 15 percent increase in billed volume as the firm continues to diversify beyond its core airport services.

Operating costs, however, rose 13 percent to P4.22 billion. MacroAsia recognized price increases tied to broader economic headwinds, including elevated jet fuel prices and supply chain disruptions stemming from the ongoing conflict in the Middle East. The geopolitical instability has forced temporary closures of key air corridors and driven up input costs across the aviation sector.

Second-Half Focus on Margins and Collections

Eduardo Luis Luy, president and chief operating officer, said the company will prioritize margin improvement in the second half through cost recovery and operational efficiencies. Management plans to boost productivity levels to offset rising expenses and intensify collections to ease financial pressure.

"MacroAsia continued to generate revenue growth across its key operating businesses during the first half of 2026, notwithstanding higher operating costs and impact of lower associate earnings on first half profitability," Luy said in the company's financial report. "For the balance of the year, our priorities are to improve our margins through cost recovery and operating efficiencies, strengthen cash conversion and maintain disciplined execution of growth investments."

The company expects to capitalize on the traditional surge in air travel during the year-end holiday season, which typically drives higher volumes for both catering and ground handling services. MacroAsia is also expanding its non-core operations to broaden its revenue base and reduce reliance on airport-linked earnings.

The NAIA lease rate adjustment reflects the broader cost environment facing aviation service providers in the Philippines, where infrastructure upgrades and operator transitions have introduced new pricing dynamics. For MacroAsia, the challenge lies in passing through these costs while maintaining competitiveness in a market where airline clients are increasingly sensitive to pricing and service flexibility.