SIA Cargo losses deepen as yields decline
28 / 07 / 2016
Singapore Airlines (SIA) Cargo has seen revenues fall and operating losses deepen on the back of a double-digit yield decline.
During its fiscal first quarter ending June 30, SIA Cargo saw revenues decline by S$60m, although it does not reveal total cargo revenues, while its operating result slipped to a loss of S$34m compared with S$9m loss a year earlier.
The airline blamed the figures on a yield decline of 17.4% and said they came despite a S$35m reduction in operating costs – thanks to lower fuel prices – and a 6.4% increase in demand to 1.7bn freight tonne km.
The airline was cautious in its outlook: “The cargo market remains soft, with economic uncertainty in Europe and China. Cargo yields are expected to remain under pressure as overcapacity persists in the industry.”
Cargo capacity at the airline was also up on a year earlier during the quarter, but SIA Cargo still managed to improve its load factor to 62% from 61.1% a year earlier.
With yields down, its breakeven load factor stands at 68.7% compared with 63.9% last year.
In terms of fleet, SIA Cargo operated nine Boeing 747-400 freighters as of June 30, compared with eight at the same point last year.