SINGAPORE (Yosefardi) – Singapore Airlines today reported Group net profit improved 12.8% year-on-year to $379 million, despite recording a lower operating profit.
This was due to an increase in non-operating items from surplus on the sale of aircraft, spares and spare engines, and higher net interest income, partially offset by a $20 million provision by SIA Cargo related to competition law matters in Australia and New Zealand.
Operating profit fell 19.8% (-$57 million) over the preceding financial year to $229 million, with the Group continuing to be affected by persistently high fuel prices and lower yields due to weak global economic conditions.
Amid these challenges, Group revenue was higher by $240 million (+1.6%) as passenger revenue grew on the back of 7.3% passenger carriage growth, albeit at lower yields. Promotional activities necessitated by intense competition as well as depreciation of revenue-generating currencies against the Singapore dollar drove passenger yields lower by 4.2%. Cargo revenue continued to suffer from a contraction in both loads (-6.0%) and yields (-4.3%).
Group operating loss widened by $39 million in the fourth quarter as revenue fell by 1.0% (-$38 million), largely owing to weaker passenger and cargo yields. In particular, both the Parent Airline Company and SIA Cargo suffered operating losses for the quarter.
The Group, however, achieved a net profit of $68 million for the quarter, against a loss of $38 million in the previous year. This is mainly attributable to the surplus on the sale of aircraft, spares and spare engines.