Sats back in the black in Q1 on growth in air cargo volume and inflight meal demand
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Sats posted a net profit of $65 million as revenue rises to $1.4 billion.
PHOTO: ST FILE
Yong Jun Yuan
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SINGAPORE - Sats on Aug 20 posted a net profit of $65 million for the first quarter ended June 30, 2024, against a net loss of $29.9 million for the same period a year earlier.
This came as revenue for the period rose to $1.4 billion, up 15.5 per cent from the $1.2 billion a year earlier.
In its business update for the first quarter, the company attributed this to the growth in revenue from both its gateway services and food solutions businesses.
Revenue for its gateway services segment grew 12 per cent year on year to $1.1 billion on an increase in air cargo volume from high-tech shipments, growth in e-commerce demand and the shift from ocean freight due to the crisis in the Red Sea.
Meanwhile, its food solutions segment’s revenue grew 29.3 per cent to $310.8 million as inflight meal demand rose.
As revenue scaled up, the company also realised operational efficiencies, which led operating profit margin to improve from 0.7 per cent to 8.2 per cent. Operating profit for the quarter stood at $112.9 million.
In the coming quarters, Sats expects to maintain its positive momentum.
“The acceleration of e-commerce, the shift to air cargo because of seaport congestion and disruption in maritime shipping are expected to continue to underpin demand for air cargo services,” the company said.
Sats shares rose 3.5 per cent, or 11 cents, to close at $3.22 on Aug 20 before the business update was released. THE BUSINESS TIMES
