Demand helps Singapore Airlines fly into profit

A Singapore Airline passenger plane taking off from Changi International Airport in Singapore. (AFP)

Singapore Airlines (SIA) said yesterday it returned to profit in the three months to the end of December following losses in the two preceding quarters, reflecting a pickup in travel demand.

SIA, one of Asia's most respected airlines whose earnings are closely monitored by the industry, said it earned S$404 million (Dh1.05 billion) in the December quarter.

This reversed a loss of S$307m in the financial first quarter and S$159m in the second quarter, said in a statement released after the stock market closed.

"Passenger loadings in January and bookings in hand indicate that the recovery in the third quarter is likely to continue in the final quarter of the current financial year," the airline said in a statement. "The improvement in yields is also holding up. Although air cargo shows similar improvement, it is more tentative because of the excess of freighter capacity and the unidirectional nature of cargo flows."

It added: "The business outlook for the group in 2010 is encouraging but it must be acknowledged that uncertainties linger over the global economy."

For the nine months to December, SIA said its net loss was S$62m, sharply narrowing from a S$466m loss recorded in the first half.

Revenue came in at S$3.418bn, up nearly 11 per cent from the second quarter. Group expenditure fell 5.2 per cent from the preceding quarter. The increase in jet fuel prices led to a S$34m rise in fuel costs, before hedging, but hedging losses were lower by S$146m, the carrier said.

 

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