Changi Airport Group's (CAG) net profit attributable to shareholder fell by 36 per cent in the financial year ended March 31, as the Covid-19 pandemic ate into its bottom line.
The profit dropped to $435 million, from $677 million in the previous financial year.
Total revenue for the financial year rose by 3 per cent from $3.04 billion to $3.12 billion.
Meanwhile, total expenses, including depreciation and amortisation, increased by 6 per cent from $2.12 billion to $2.25 billion.
CAG attributed the rise to higher depreciation and operating expenses with Jewel's opening and the completion of the Terminal 1 expansion project.
The group said it had performed well in the first 10 months of FY2019/20 due to strong travel demand and the opening of Jewel Changi Airport, but business conditions "deteriorated sharply" in February as the Covid-19 outbreak started to spread globally.
In its latest annual report released yesterday, former chairman Liew Mun Leong and chief executive Lee Seow Hiang said in a joint message that the group's strong performance in the first 10 months of the year was "severely negated by the collapse in air travel".
CAG has cut the salaries of its management and staff by up to 30 per cent to cope with the significant impact of Covid-19 on its financial results and conserve cash due to the uncertainty ahead, they said.
The Straits Times understands that senior management had their pay cut by up to 15 per cent in April. The cuts were expanded to all staff in CAG in July, ranging from 3 per cent to 30 per cent.
In a further cost-cutting attempt, CAG has also recommended no dividend payout to its shareholder, the Ministry of Finance.
Passenger traffic at Changi fell 33 per cent in February and 71 per cent in March, compared with a year ago.
This resulted in Changi Airport seeing passenger traffic decline 5.1 per cent for the year, to 62.9 million. This is the first yearly passenger traffic decline since 2008/09, when the global financial crisis struck.
Meanwhile, concessions revenue dropped by 4.9 per cent compared with the last financial year. This was due to a 57.5 per cent drop in revenue in February and March after the pandemic struck, said CAG.
Its overseas investments also contributed to the hit to the accounts.
CAG had to make a one-off non-cash impairment of assets in Rio de Janiero's Tom Jobim International Airport, in which it owns a 51 per cent stake. This resulted in a reduction in net profit by $200 million.
On the mega Terminal 5 project, which has been paused for at least two years, CAG said there will be studies to reassess air traffic demand projections and see how the project's design might be affected in a post-pandemic world.
But it stressed that T5 remains a critical long-term infrastructure investment for the future of Singapore's economy.
In CAG's annual report, Mr Liew and Mr Lee said recovery in the travel sector is highly dependent on how countries manage border controls, air travel requirements and the development of viable medical treatments for the coronavirus.
"The future does appear daunting with the situation showing no signs of abatement," they said.
But CAG will continue to work with agencies and partners to seek solutions for safe travel, they added. "The aviation industry remains promising in the long term as there is still a need and demand from people to fly again, both for leisure and business."