SIA Group's nine-month profit declines 59%

Singapore Airlines parent SIA Group reported a net profit of S$374 million ($298.2 million) for the first nine months of its April 1-March 31 fiscal year, down 59% from S$921 million in net income in the year-ago period.

Results were not much better for the fiscal third quarter ended Dec. 31, for which SIA posted a S$153 million net profit, down 53% year-over-year.

SIA said in a statement that "persistently high jet fuel prices … adversely affected the Group's performance."

The airline is not optimistic about the current quarter. "Forward bookings continue to show signs of weakness in the final quarter of the financial year, due to uncertainty in the global economy and the protracted Eurozone debt crisis," SIA stated. "Passenger yields are expected to remain under pressure while cargo yields are expected to continue to decline. As the price of jet fuel remains high and volatile, fuel costs continue to adversely impact the Group's financial performance."

SIA's fiscal nine-month revenue rose 2% to S$11.15 billion while expenditures increased by 10% to S$10.86 billion "principally on account of higher jet fuel prices," the company said. Nine-month operating profit fell 74% to S$814 million.

Fiscal third-quarter operating profit was S$159 million, down 69% year-over-year. Breaking down SIA's fiscal third quarter by subsidiary, Singapore Airlines earned a S$137 million operating profit, down 64% (owing mainly to a 34% rise in aircraft fuel costs); SIA Engineering posted a S$28 million operating profit, down 17.6%; regional SilkAir reported a S$32 million operating profit, down 28.9%; and SIA Cargo incurred an operating loss of S$40 million, reversed from a S$48 million operating profit in the 2010 December quarter.

SIA mainline passenger traffic rose just 2.5% year-over-year for the nine months ended Dec. 31 to 65.64 billion RPKs on a 5.3% lift in capacity to 84.83 billion ASKs, producing a load factor of 77.4%, down 2.1 points. Nine-month passenger yield was flat year-over-year at S$0.119.

Article Source : ATW Daily News