by Ernie B. Calucag
Singapore Airlines, the world’s second largest airline by market value, on Thursday reported a 53-per cent decline in quarterly net profit, hit by high jet fuel prices and warned that passenger yields would be under pressure.
The national carrier, around 55 per cent owned by Temasek Holdings, earned net profit of S$135.2 million for the quarter ending 31 December 2011 (3QFY2012), down from S$288.3 million a year ago.
Persistently high jet fuel prices adversely affected its performance, with turnover for the same period flat at S$3.88 billion from S$3.84 billion a year ago.
Year-to-date net profit tumbled 59 per cent year-on-year to S$374.1 million from S$921 million.
Meanwhile, cumulative revenue for nine months rose 2 per cent to S$11.15 billion from S$10.94 billion in the same period the previous year.
Singapore’s national carrier said that forward bookings continue to show signs of weakness in the final quarter of the financial year, due to uncertainty in the global economy and the protracted eurozone debt crisis.
“As the price of jet fuel remains high and volatile, fuel costs continue to adversely impact the group’s financial performance,” the airline added.
The global airlines industry has been struggling to pass on the higher cost of fuels to customers as demand for business and leisure travel dwindled due to the global economic slowdown.
The International Air Transport Association (IATA) cut its forecast for airline industry profits by a quarter to US$3.5 billion for 2012 and warned the industry could plunge to an US$8.3 billion loss if Europe’s debt problems trigger another banking crisis.
Singapore Airlines’ shares closed higher on Thursday at S$11.0 from the previous close of S$10.96.
