SINGAPORE: Singapore Airlines (SIA) posted on Thursday (Nov 5) a 2.3 per cent drop in second quarter operating profit as weaker performance by its flagship carrier offset improvements at SIA Engineering and SilkAir.
SIA made an operating profit of S$129 million at the group level for the three months ended September, down slightly from S$132 million in the same period a year ago. The main cause for the dip in operating profit was SIA itself, which saw operating profit fall to S$98 million from S$138 million a year ago.
SilkAir turned in a sterling performance, earning S$21 million during the quarter compared to S$3 million last year. SIA Cargo and Scoot narrowed losses.
Group net profit was S$214 million, improving S$123 million from the
second quarter last year. This was primarily due to an absence of share of loss from associated companies.
Looking ahead, SIA said economic conditions remain uncertain, exacerbated by worries about China’s slowing economy. This has led to weakening emerging-market currencies and volatility in stock markets. It added that yields remain under pressure in the face of capacity additions from other airlines.
"Faced with these challenges, the group will maintain strict cost discipline," SIA said in a statement.
The group is well placed to retain its competitive edge through the many strategic initiatives that are in place, supported by a strong balance sheet, it added.