Singapore Airlines returns to profit

February 2, 2010
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, SINGAPORE, Feb 2 – Singapore Airlines (SIA) said Tuesday 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 404 million Singapore dollars (286 million US) in the December quarter.

This reversed a loss of 307 million dollars in the financial first quarter and 159 million dollars 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."

Before the announcement SIA shares closed at 13.66 Singapore dollars, down 20 cents, or 1.44 percent, from the previous day. The Straits Times Index fell 15.30 points, or 0.56 percent, to 2,720.87.

For the nine months to December, SIA said its net loss was 62 million dollars, sharply narrowing from a 466 million-dollar loss recorded in the first half.

Revenue came in at 3.418 billion dollars, up nearly 11 percent from the second quarter. Group expenditure fell 5.2 percent from the preceding quarter.

The increase in jet fuel prices led to a 34 million-dollar rise in fuel costs before hedging, but hedging losses were lower by 146 million dollars, the carrier said.

SIA posted its first quarterly loss in six years during the June quarter as the global economic slump and swine flu outbreak battered travel and cargo demand. Singapore is a regional aviation hub.

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