SINGAPORE - Singapore Airlines' net profit for the first quarter ended June fell 20.7 per cent to S$111 million from S$140 million a year ago owing to higher share of losses from associated companies and net finance charges plus an uptick in expenditure.
Revenue came in 6.7 per cent higher for the quarter under review to S$4.1 billion from S$3.8 billion. Flown revenue was up S$226 million or 6.3 per cent with passenger flown revenue improving by nearly 9 per cent, buoyed by traffic growth and increase in capacity.
Despite the significant capacity injection, RASK (revenue per available seat-kilometre) improved 1.3 per cent. Cargo flown revenue declined 8.4 per cent on lower cargo yield and cargo load factor due to weak cargo demand amid trade uncertainties.
Operating profit improved by 3.6 per cent to S$200 million while expenditure jumped 7 per cent to S$3.9 billion. In line with capacity increase, the group's ex-fuel costs rose 6.1 per cent while net fuel costs rose 8.7 per cent led by an increase in volume uplifted on capacity expansion, and a stronger US dollar, said the airline group in its results statement.
Earnings per share stood at 9.4 Singapore cents versus 11.8 Singapore cents previously. No dividend was recommended, same as the previous corresponding period.
Strong revenue growth, thanks to a 9 per cent increase in passenger traffic, led the parent airline company to post a 28 per cent rise in operating profit to S$232 million. Passenger load factor rose 1.2 percentage points to 83.2 per cent, the highest on record for the first quarter.
SilkAir turned in an operating loss of S$16 million against a marginal profit of S$200,000 a year ago as it was significantly impacted by the grounding of its six 737 MAX 8 aircraft. The capacity reduction coupled with a 2.9 per cent yield contraction, contributed to a S$10 million decline in revenue while expenditure ticked higher by 2.5 per cent primarily due to costs related to the MAX 8 grounding.
"The grounding of the 737 MAX 8 fleet has disrupted the group's operations and rate of expansion. While the fleet remains out of service, the group continues to take active measures to mitigate the effects of the grounding," said the SIA group in the announcement.
Scoot also put out a much weaker showing with an operating loss of S$37 million from a S$1 million operating profit a year ago on higher expenditure. Other contributing factors included restrained capacity growth and lower yields.
SIA Engineering's operating profit rose 80 per cent to S$18 million led by lower expenditure.
SIA shares finished five Singapore cents lower at S$9.67 on Wednesday.