PPRuNe Forums - Singapore Airlines Beats Forecasts

Reuters

Singapore Airlines Beats Forecasts
October 29, 2003

Singapore Airlines posted a much stronger than expected September quarter profit on Wednesday as heavy cost-cutting more than offset a lingering squeeze on revenues from the SARS outbreak.

After an unprecedented June quarter net loss of SGD$312 million (USD$180 million) when SARS hammered travel demand, the flag carrier posted a net profit of SGD$305.8 million in the three months to September, citing a rebound in traffic and cost cuts. The profit was up 3.6 percent from the same quarter a year earlier.

Singapore Airlines said the earnings turnaround came despite a 6.4 percent fall in revenue to SGD$2.52 billion.

SIA Engineering, the group's aircraft maintenance, repair and overhaul arm, said its second-quarter net profit dropped 29.5 percent to SGD$38.3 million (USD$22 million) against SGD$54.3 million in the same period a year earlier.

The airline's baggage-handling and catering arm, Singapore Airport Terminal Services (SATS) said net profit rose 3.2 percent to SGD$50.9 million (USD$29.34 million) for the three months to September 30 against the same period a year ago.

SATS, the dominant aviation services provider at Singapore's Changi Airport, had posted a first-quarter net profit of SGD$27.9 million.

Asian airlines such as Cathay Pacific and Singapore Airlines suffered heavily from the Severe Acute Respiratory Syndrome (SARS) outbreak between March and June this year which forced them to suspend flights, trim costs and offer heavily discounted air fares to entice people to travel.

The Singapore carrier cut wages, slashed capacity by a third, and axed nearly 600 staff -- the largest lay-offs in its 56-year history.

But along with other Asian carriers, it is seeing travel demand return and has restored flights back to pre-SARS levels.

"Passenger demand is expected to remain buoyant in the next two quarters especially during the traditional year-end travel peak," the airline said in a results statement.

Analysts expect Singapore Airlines to be profitable for the full year, helped by a returning confidence in air travel and as average fares rise following the end of heavy discounts in the first half. But earnings are expected to be lower from a year earlier due to the impact of SARS on travel demand.

(Reuters)

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Photo: Singapore Airlines 777-200 9V-SRL on dep for
Changi from rwy 01 BNE 27/10/03

http://www.jetphotos.net/viewphoto.php?id=170670

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