Singapore Airlines Ltd reported a quarterly net profit on Tuesday that missed estimates and flagged concerns of increased competition as the airline industry made the most of a rebound in air travel following the end of Covid-related curbs.
The city-state's flagship carrier said passenger yields continued to come under pressure from competitors as airlines globally hiked up the number of flights and routes to meet increased travel demand.
Geopolitical and macroeconomic concerns, inflationary pressures, and supply chain constraints are likely to pose headwinds to the industry, it added.
Net profit rose nearly 5 per cent to S$659 million (US$490.4 million) helped mainly by a lower tax expense as well as a share of profits from associated companies and a surplus from the disposal of aircraft and spare parts.
Even then, however, it missed analysts' average estimate of S$777.8 million, as per LSEG IBES data.
The carrier's operating profit fell 19.3 per cent to S$609 million year-on-year as total expenses rose 9.2 per cent. This was mainly due to a 9.1 per cent rise in fuel costs, which account for a large portion of overall expenses.
Non-fuel costs rose 9.1 per cent, "in line with the 11.1 per cent increase in overall passenger and cargo capacity," the airline said.
Robust demand for air travel drove its revenue up 4.9 per cent to its highest-ever quarterly revenue, with the airline seeing air travel demand remaining healthy in January-March quarter as well as the following April-June quarter. - Reuters