SIA Cargo profits free-fall
11 / 05 / 2012
SINGAPORE Airlines Group reveals the operating profits of its subsidiary SIA Cargo fell S$32m (US$25m) to S$119m ($95m) in the last financial year.
This compares with S$151m ($120m) between 2010 and 2011.
The carrier predicts the recovery of air freight demand will be “gradual, possibly only in the second half of the year”.
It also revealed it expects cargo yields “to remain stagnant for the next quarter”.
“High fuel prices and an uncertain global economy weighed heavily on the group’s earnings in the 2011-12 financial year, pushing net profit down by S$756m ($604m) or 69 per cent to S$336m ($268m),” a company spokesman states.
“Jet fuel prices remained high throughout the year, resulting in a 32 per cent spike year-on-year in average jet fuel prices to $133 per barrel.
“This translated to a 29 per cent increase in fuel cost before hedging, which contributed to the 10 per cent rise in group expenditure.”
As a result, the group’s overall operating profits fell S$985m ($787m) to S$286m ($228m).