Singapore Airlines earns highest profit in seven years

 Friday, May 18, 2018 


Singapore AirlinesSingapore Airlines has topped its market expectation by reporting a 148 percent rise in full-year net profit to the highest level since 2011.



The passenger and cargo revenue rose high. It benefited from a transformation programme.




However, it warned of pressures from intense competition, costs and rising fuel prices despite strong bookings for the coming months and a continued stabilization in airfares.



Singapore Airlines makes a benchmark for Asia’s premium airlines. It made S$893 million ($665.6 million) in the year ended March, up from S$360 million a year earlier and 28 percent higher than the S$697 million average.




A strong fourth quarter marked a turnaround from a year ago, when an operating loss by its flagship full-service airline led the company to launch a three-year transformation program designed to cut costs and boost revenue amid competition from Chinese and Middle Eastern rivals and low-cost carriers.




Singapore Airlines said that the transformation initiatives include a new revenue management program, a new airfare pricing structure and the establishment of centralized pricing unit boosted revenue, while the airline also saved costs via more efficient use of fuel and waste reduction.




The group revenues rose 6.3 percent to S$15.8 billion for the full year, with improvements across all business lines, outpacing a 3.5 percent rise in costs, including an 18 percent increase in fuel.




The airline announced a final dividend of S$0.30 a share, nearly triple the S$0.11 paid a year earlier.



In the fourth quarter ended March 31, operating profit rose to S$214 million from S$27 million a year earlier, with the flagship full-service airline swinging from last year’s S$41 million loss to a S$137 million profit.



The average ticket prices, or yields, rose to 1 percent in the fourth quarter. It is breaking a downward trend as the airline and its peers curbed discounting to counter rising fuel prices.




Oil prices have risen to the highest level in three and a half years, with Brent crude futures LCOc1 reaching $80 a barrel on Thursday.




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