Singapore Airlines group's quarterly loss narrows to US$336 million

THE SIA Group, the parent of Singapore Airlines, has posted an unaudited net loss attributable to share holders for the second quarter ending September 30 of S$159 million (US$114.55 million).

This is an improvement on the first quarter's net loss of S$307 million, with a group statement saying, "Advance bookings indicate that demand for air travel has stopped declining and is gradually recovering."

The group's net loss for the first half of its financial year amounted to S$466 million (US$336.05 million), against a profit of S$682 million a year ago.

Group revenue for the second quarter grew by 7.3 per cent from the previous quarter to S$3,082 million.

Second quarter expenditure increased by S$73 million, or 2.3 per cent, quarter-to-quarter mainly due to the rise in jet fuel prices.

Fuel costs ex-hedging for the second quarter at S$942 million was S$202 million higher than the previous quarter, while losses from fuel hedging fell by S$87 million to S$200 million. This was partially offset by lower payrolls and cost savings in other non-fuel expenditure.

As a result, the group posted an operating loss of S$182 million for the second quarter, less than the S$319 million loss suffered in the first quarter of the year, a group statement said.

In the first half of the year, Singapore Airlines (SIA) recorded an operating loss of S$428 million, while SIA Cargo posted an operating loss of S$193 million, and SilkAir registered an operating loss of S$5 million.

In the six months to September 30, SIA Cargo carried 549.0 million kilogrammes of cargo and mail, down from 661.3 million kilogrammes for the same period a year earlier. The cargo load factor fell to 61.8 per cent during the reporting period, down from 61.1 per cent a year earlier.

Meanwhile, Singapore Airlines carried 8,003,000 passengers, down from 9,634,000 in the first half of 2008. The passenger load factor was 75.6 per cent, down from 77.9 per cent for the corresponding prior year period.

Looking ahead, "I'm probably looking at a gradual recovery," Ng Sem Guan, an analyst at OSK Research, was quoted as saying in a Reuters report about SIA. "I think next quarter they will be break even or probably make some profit."

For its part the SIA Group has issued a full-year profit warning, however, analysts polled by Thomson Reuters expected SIA will record a net profit of S$183.6 million in the current financial year ending March 31, 2010, down from S$1.06 billion the previous year.

Source: http://www.joc.com