Singapore Airlines Q1 profit drops amid faltering passenger yields

Passenger yield at Singapore Air fell to 10.1 Singapore cents.

singapore airlines
People pass a Singapore Airlines signage at Changi Airport in Singapore . REUTERS

Singapore Airlines on Thursday said its first-quarter net profit fell 8.4 percent due to the absence of divestment gains and special dividends.

Singapore Air group -- which includes brand Singapore Air, a regional airline and two budget carriers -- reported a net profit of S$235.1 million in the three months ended June 30 versus S$256.6 million a year ago.

Last year, the group made a S$141.6 million gain from the divestment of its 10 percent stake in Hong Kong Aero Engine Services (HAESL).

It also received a special dividend of S$36.4 million from HAESL following the divestment of HAESL's 20 percent stake in Singapore Aero Engine Services.

Sales rose 5.6 percent to S$3.9 billion, the carrier said in the statement.

Passenger yield at Singapore Air, or the money earned from carrying a passenger for one kilometer, fell to 10.1 Singapore cents from 10.3 cents last year.

The premium carrier said passenger yields -- a key measure of profitability in the industry -- continued to be remain under pressure.

Fuel costs at Singapore Air rose 3.4 percent to S$925.7 million in the quarter.

The Group said it will continue to take delivery of modern and fuel-efficient aircraft to further expand its network and enhance its competitiveness in both the fullservice and low-cost market segments.

Shares of Singapore Air rose 0.20 percent to S$10.15 on Thursday. The stock has gained 5 percent this year, compared with a 16 percent rise in the benchmark Straits Times Index.