Singapore Airlines swings to record profit, says year off to strong start

Singapore Airlines Ltd (SIA) posted its first annual profit in four years on Tuesday (May 16) and said the current year is off to a strong start with higher bookings to China, Japan and South Korea as pandemic curbs ended globally.

The city-state’s flag carrier logged a record-high profit of $2.16 billion for the year ended March 31, after posting losses for the past three years.

The profit also beat analysts’ average estimate of $2.10 billion, per Refinitv IBES, as the airline benefited from strong pent-up demand for air travel as restrictions eased domestically in April last year, and most recently in China.

SIA said the group’s passenger capacity reached 79 per cent of pre-Covid levels in March and is expected to rise to around 83 per cent in the first half of the current fiscal year. Its load factor, a measure of how well an airline is filling available seats, jumped to a record-high 85.4 per cent.

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The turnaround is in line with other airlines such as Australia’s Qantas, which returned to a first-half profit in February but warned of inflation pressures and competition.

SIA echoed that warning and added that even near-term cargo demand would be softer as the supply chain bottlenecks ease and weaker economic conditions impact consumer demand and trade.

The carrier, which is set to take a 25.1 per cent stake in Air India, said its expenses for the year swelled 83.4 per cent to $15.08 billion, partly driven by fuel prices remaining at elevated levels.

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