Singapore Air Says Headwinds Persist As Profit Jumps Threefold
Singapore Airlines Ltd. said profit almost tripled last quarter, fueled by an increase in passenger and cargo traffic, even as it warned of challenges as rivals add capacity in key markets.
Net income in the three months through September rose to S$189.9 million ($139 million) from S$64.9 million a year earlier, Southeast Asia’s biggest carrier said in a statement Tuesday. Revenue rose 5% to S$3.85 billion.
Singapore Air is coming off a low in the same period of last year, when net income plunged 70 percent amid slumping demand. The group, which includes low-cost carrier Scoot and regional airline SilkAir, is undertaking a companywide review to fend off intensifying competition, from Middle Eastern carriers for top-tier customers to budget airlines for cost-conscious passengers.
Singapore Air said its three-year business transformation is “progressing on track,” without elaborating. The revamp may include job cuts and is aimed at better positioning itself against mounting competition, it said earlier.
The Singapore carrier has offered three months of voluntary unpaid leave to cabin crew since September as part of the overhaul. The airline had 8,356 cabin crew at the end of March, according to its annual report. In May, the carrier said it was merging its cargo unit with the airline by the first half of 2018 to improve efficiency, with most employees retained in the new cargo unit or transferred to other divisions.
The airline’s flying newer aircraft such as Airbus SE A350s and has also formed closer ties with other airlines such as Deutsche Lufthansa AG to gain passengers. Singapore Air -- the first in the world to put a double bed in its cabins and the first to give free alcohol to economy-class passengers -- is also spending $850 million to refit all cabins on its A380s.