The revenue gain was due to high passenger demand, as passenger flown revenue climbed 10.6 per cent to S$4.2 billion, despite a 7.4 per cent decline in passenger yields to S$0.112 passenger-km.
The group’s operating profit, however, decreased 19.3 per cent to S$609 million, from S$755 million in Q3 FY2023. This was due to total expenditure increasing by 9.3 per cent to S$4.5 billion, as non-fuel expenditure and net fuel cost both booked gains.
For the nine months ended Dec 31, 2023, the group’s net profit rose 35 per cent to a record S$2.1 billion from S$1.6 billion. Revenue for nine-month FY2024 reached S$14.2 billion, expanding 7.4 per cent from S$13.3 billion yoy.
Rise in passenger numbers
SIA and its budget arm Scoot flew 9.5 million passengers in Q3 FY2024, up 29.4 per cent yoy.
The group’s passenger traffic for the quarter also grew 19.1 per cent to 37.1 billion, outpacing capacity injection of 17.9 per cent, noted SIA.
Passenger traffic, expressed as revenue passenger-km, indicates the number of passengers carried multiplied by the distance flown.
As a result, the group passenger load factor improved by 0.8 percentage point to 88.2 per cent.
Meanwhile, its cargo flown revenue fell 35.1 per cent to S$559 million. Cargo loads increased by 3.9 per cent to 1.4 billion tonne-km on strong year-end demand from e-commerce.
This resulted in a cargo load factor of 55.5 per cent, adding 1.2 percentage points on-year.
SIA’s Q3 cargo yield of S$0.403 per load tonne-km was 37.4 per cent lower yoy, but remained 32.1 per cent above pre-pandemic levels, referring to a cargo yield of S$0.305 per load tonne-km in FY2020.
Singapore’s national carrier said that the demand for air travel is likely to remain healthy for the last quarter of FY2024 and into Q1 FY2025.
“Forward sales continue to be robust, in line with capacity increases in most markets, supported by the demand for leisure travel through the school holidays and Easter peak in March and April 2024,” said SIA.
However, the group believes that passenger yields will continue to come under pressure from increased competition, as capacity restoration continued across the industry.
It added that heightened geopolitical tensions and economic uncertainty could weigh on business sentiment and air travel demand.
Supply chain constraints, high fuel prices and inflationary pressures will also present a more challenging operating cost environment for airlines globally.
Despite these headwinds, the group expects a return to pre-pandemic capacity levels within FY2025, as it added more destinations to its network and took stock of its fleet.
In Q3, the main airline reinstated flights to Chongqing and Xiamen in China, while Scoot resumed service to Kunming.
“With this, the group operates to 23 destinations in China, compared to 25 points pre-pandemic,” said SIA.
It also aims to ramp up services to Fukuoka and Nagoya in Japan, Milan in Italy and London’s Gatwick Airport in the UK in the upcoming end-March to end-October operating season.
As at Dec 31, 2023, the group’s operating fleet comprised 202 passenger and freighter aircraft with an average age of seven years and one month. It has 92 aircraft on order.
Shares of SIA closed up 1 per cent or S$0.07 at S$7.37 on Tuesday, before the announcement.
