SINGAPORE: Singapore Airlines (SIA) on Thursday (May 18) reported a net loss of S$138 million in its fourth quarter from January to March, reversing from a S$225 million net profit in the same period last year.
Fuel costs before hedging increased $331 million in the quarter, due to a 50.7 per cent surge in average fuel prices and a stronger US dollar against the Singapore dollar.
The company also said that passenger flown revenue fell $17 million despite a 5.5 per cent traffic growth.
"Intense competition continues to exert pressure on yields amidst persistent cost pressures," SIA said in a news release.
It also said that it made a provision for its cargo unit for "competition-related matters".
The national carrier said its operating profit for the 2016-2017 financial year was S$623 million, S$58 million lower than the same period last year.
Its full-year net profit fell by 55.2 per cent, attributable "in part" to the net loss recorded in the fourth quarter.
The S$138 million net loss is in stark contrast to the S$225 million net profit the group reported in the fourth quarter of the previous financial year.
For the full year, operating profit in its main SIA brand fell 20 per cent to S$386 million from the previous financial year.
However, profit increased 11 per cent in its SilkAir regional airline and also jumped by 59.52 per cent for its budget aviation holdings including low-cost subsidiaries, Tiger Airways and Scoot.
SIA Cargo posted an operating profit of S$3 million, up from a S$50 million loss the previous financial year.
Looking ahead, SIA said: "Intense competition arising from excess capacity in major markets, alongside geopolitical and economic uncertainty, continue to exert pressure on yields."
On a more upbeat note, it said that the many strategic initiatives implemented to address structural changes "are now showing positive results".
"Building on this foundation, the next phase of the SIA Group's transformation has been launched" with a wide-ranging review under way, the company said.
"The review is aimed at identifying new revenue-generation opportunities and reshaping the business into one that continues to deliver high-quality products and services, though with a significantly improved cost base and higher levels of efficiency."