Singapore Airlines Ltd (SIA) on Thursday reported a nearly 9 percent drop in its operating profit for the year ended March, as weakness in its main passenger travel operation offset a stronger cargo business. Profit reached S$623 million ($447.65 million) for the financial year, S$58 million lower than a year ago. The carrier, a barometer of the health of Asia’s competitive airline industry, has come under pressure due to weakening demand for full-service long-haul travel amid competition from low-cost carriers and Middle Eastern network carriers.
According to Nikkei Asian Review, Singapore Airlines has run into its first quarterly loss in 5 years.
Singapore Air runs into first quarterly loss in 5 years https://t.co/I1fLKp9TK5
— Nikkei Asian Review (@NAR) May 18, 2017
“Intense competition arising from excess capacity in major markets, alongside geopolitical and economic uncertainty, continue to exert pressure on yields,” the company said in a statement. Its annual net profit more than halved from year-ago levels to S$360 million. Operating profit for the parent airline company fell about 20 percent to S$386 million. But SIA Cargo swung to an operating profit of S$3 million for the year, from a S$50 million loss last year, reflecting a broader improvement in the global air freight market.
Data from the International Air Transport Association shows global freight volumes rose by nearly 11 percent year-on-year over the first three months of the current calendar year. Singapore Airlines declared a final dividend of 11 cents per share for the 2016/17 financial year.