Tigerair's third-quarter profits soar to S$6.8 million

Falling fuel prices boosted profits at Tigerair, with operating profit increasing from $4.1 million to $10 million.
Falling fuel prices boosted profits at Tigerair, with operating profit increasing from $4.1 million to $10 million.

SINGAPORE - Falling fuel prices boosted profits at Tigerair which soared 209 per cent to S$6.8 million for the three months ended Dec 31.

Operating profit increased to S$10 million from S$4.1 million a year ago.

Turnover for the October-December quarter increased by 1.5 per cent to S$187.4 million while spending decreased by 1.8 per cent to S$177.3 million.

Chief executive of the budget carrier Lee Lik Hsin, said: "The low fuel price environment has helped our third quarter performance and we expect to continue benefitting from it."

Fuel prices are at their lowest in more than 10 years.

For the nine months to December, Tigerair recorded an operating profit of S$200,000, reversing a S$37.6 million loss a year ago.

Net loss during the same period narrowed to S$7.7 million, compared to previous year's net loss of S$245.4 million.

Despite the respite from lower fuel prices, there are challenges, Mr Lee said during a media teleconference following the release of the results.

Marco-economic conditions are expected to remain uncertain and surplus capacity in the industry will continue to exert downward pressure on yields in the near term, he stressed.

Tigerair will continue to work closely with the Singapore Airlines (SIA) group to drive synergies and efficient operations.

SIA which has made a takeover offer for Tigerair has given the budget carrier's shareholders until Feb 5 to decide if they wish to sell.

In an update last week, SIA said it now owns, controls or has agreed to acquire 79.22 per cent of Tigerair's shares.

SIA needs to take this to 90 per cent, after which the intention is to delist Tigerair to facilitate closer cooperation and integration with other carriers within the group, especially SIA's long-haul, low-cost arm Scoot.

karam@sph.com.sg