Lower fuel prices, a better operational performance and one-time gains sent quarterly earnings soaring at the Singapore Airlines (SIA) group.
Overall net profit leapt from $91.2 million last year to $256.6 million, up 181.4 per cent, thanks partly to a one-off gain of $178 million.
This included about $142 million from SIA Engineering's divestment of its 10 per cent stake in Hong Kong Aero Engine Services (HAESL) and a special dividend of $36 million from HAESL following the sale of its 20 per cent interest in Singapore Aero Engine Services.
Turnover slipped 2.1 per cent to $3.65 billion for the group's first quarter ended June 30, partly from lower passenger revenue at SIA. Helping to balance this out were stronger showings at group subsidiaries Scoot and SilkAir after operations were expanded.
Quarterly spending dropped 4.4 per cent to $3.46 billion, mainly because average jet fuel prices fell 28 per cent. The gains were partly offset by a strengthening of the greenback against the Singdollar and capacity expansions at SilkAir and Scoot.
Except for SIA Engineering and SIA Cargo, all the companies in the group, which includes SIA, SilkAir, Scoot and Tigerair, performed better operationally because of cheaper fuel.
AT A GLANCE
REVENUE: $3.65 billion (-2.1%)
NET PROFIT: $256.6 million (+181.4%)
Operating profit for SIA rose $89 million to $197 million for the quarter, while SilkAir's jumped from $5 million to $27 million.
Tigerair booked $8 million in operating profit for the quarter - an improvement from its breakeven result a year ago. At Scoot, operating profits came in at $1 million, overturning its operating loss of $20 million the year before.
Quarterly earnings per share for the group came to 21.7 cents, up from 7.8 cents in the previous year, while net asset value per share was $11.44 as at June 30, compared with $10.96 at the end of March.
The group expects the business outlook for SIA itself to remain challenging amid economic weakness and geopolitical concerns in some markets.
"Competition remains intense with aggressive capacity injection, and yields will continue to remain under pressure. Yields will be further diluted if key revenue-generating currencies depreciate against the Singapore dollar," the group said in a statement yesterday.
SIA shares closed eight cents higher at $11.20 yesterday, before the earnings were announced.