Singapore. Singapore Airlines said its second-quarter net profit nearly tripled on the back of stronger operating results, helped by a rebounding cargo business, but yields remained under pressure as competitors increased capacity.
The carrier, a benchmark for Asia's premium airlines, earned S$190 million ($139 million) in the three months to Sept. 30, up from S$65 million a year before, it said on Tuesday (07/11).
"Headwinds remain as competitors mount significant capacity in key markets. Yields continue to be under pressure, despite some stabilization in recent months," the airline said.
The airline and Hong Kong-based rival Cathay Pacific Airways Ltd have been struggling against mounting global competition from Chinese and Middle Eastern rivals and low-cost carriers, with no domestic flights to underpin their earnings.
Passengers travelling with Singapore Airlines increased by 2.3 percent in the second quarter and the carrier's second-quarter operating profit rose to S$232 million, from S$109 million a year earlier.
Singapore Airlines itself contributed S$170 million to group operating profit in the quarter, up from S$79 million a year earlier, while the SilkAir unit's operating profit fell 17.6 percent to S$14 million, and that of low-cost subsidiary Scoot's declined by 75 percent to S$2 million.
The cargo division reported an operating profit of S$26 million, rebounding from an operating loss of S$11 million a year ago amid a strong recovery in the freight market globally.
Singapore Airlines is undertaking a three-year transformation plan designed to make its business more competitive after reporting a surprise fourth-quarter loss in May.
Last week it said it would spend $850 million to increase the overall seat count by up to a quarter in its fleet of A380 superjumbos and halve the number of first class seats to combat lower airfares and boost competitiveness.
The company's management team will hold a detailed briefing for investors and media on Wednesday.