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Singapore records profit increase but warns of tough conditions

written by australianaviation.com.au | May 9, 2014

SIA has warned that low yields and economic uncertainty will continue to affect its profitability. (Andrew McLaughlin)
SIA has warned that low yields and economic uncertainty will continue to affect its profitability. (Andrew McLaughlin)

Singapore Airlines Group has recorded a 13.1 per cent increase in its operating profit to SG$259m (A$222m) for the year ended March 31.

Revenue across the group, which includes Singapore Airlines, SIA Engineering, regional carrier SilkAir, and SIA Cargo, rose one per cent to SG$15.24bn (A$13.04bn) for the year on the back of higher passenger revenue, but was offset by a decline in cargo revenue.

The carrier warned that economic uncertainty and lower yields had contributed to a SG$60m loss in the final quarter of the year.

“The operating environment for the group continues to be challenging with intense competition in many areas, and economic uncertainty in key markets,” the airline said in a statement. “Passenger bookings in the current quarter are expected to match the planned increase in capacity. However, yields are expected to remain under pressure because of promotional activities undertaken to support loads, and other airlines offering aggressive fares while increasing capacity.”

A breakdown of the results saw Singapore Airlines record a profit of SG$256m (A$220m) for the year, a profit of SG$116m (A$99m) by SIA Engineering, a profit of SG$35m (A$30m) by SilkAir, and a loss of SG$100m (A$85.6m) by SIA Cargo.

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