Sats Q1 profit falls 10.6% to $57.3 million

A file picture of the control centre of ground-handling firm Sats. PHOTO: SPH
A file picture of the control centre of ground-handling firm Sats. PHOTO: SPH

Flat revenue and higher spending hit first-quarter earnings at Sats.

Net profit at the ground-handling firm dipped 10.6 per cent to $57.3 million, in the three months to June 30, compared with the same period last year.

The fall was also due in part to the absence of last year's gain from the disposal of assets, the firm said on Friday (July 21).

Operating profit for the quarter was $53.5 million, a fall of $1 million or 1.8 per cent year-on-year

The weaker performance came as revenue increased slightly by 0.5 per cent to $426.5 million.

Earnings per share fell from 5.8 cents last year to 5.1 cents, while net asset value per share inched up to $1.49, compared with $1.44 as at March 31.

There is no indication that low yields across the airline industry will improve in the near future, so pricing pressure on Sats is expected to continue, the firm said.

However, the growth in air travel, e-commerce and demand for high quality and safe food remain strong.

"Therefore, we intend to make further investments in capital and new business opportunities in additional locations in the coming year to prepare for the future," the firm added.

Sats said it will also continue to "increase the use of technology to improve productivity, gain greater scale economies and link our regional operations to serve customers better".

The firm controls about 80 per cent of Changi Airport's ground-handling market while rival Dnata has the remaining 20 per cent.

Including its Singapore operations, the firm has a presence at 47 airports in 14 countries across Asia and the Middle East.