Singapore Airline's Net Profit Up By 147%- Air India Vistara Merger

Singapore Airlines Group announced a 3.3 percent increase in operating profit to USD 629 million for the third quarter of FY2024/25. Revenue hit a record USD 5.2 billion, driven by robust passenger demand. The Group's net profit surged by 146.7 percent, bolstered by a non-cash accounting gain following the Air India Vistara merger. The Group's strong financial performance reflects effective cost management and strategic initiatives.

Singapore Airlines Group reported a 3.3 per cent year-on-year increase in operating profit, reaching USD629 million for the third quarter of FY2024/25. This was achieved despite a competitive landscape and declining yields. The Group posted record revenues of USD 5.22 billion for the three months ending 31 December 2024, a 2.7 per cent increase compared to last year's period. Passenger carriage reached a new high, with SIA and Group carrying 10.2 million passengers, a 7.2 per cent increase over the previous year. However, competition and increased capacity led to a 4.5 per cent decrease in yields, which placed pressure on revenue per passenger kilometre.

Cargo revenue also saw a rise of 9.7 per cent yearly, driven by a surge in e-commerce perishables traffic and freighter operations. However, yields for cargo dipped by 4.5 per cent. Expenditure increased by 2.6 per cent to USD 4.59 billion primarily due to higher non-fuel costs, which grew by 8.6 per cent. Fuel costs decreased by 9.8 per cent, and cost management helped mitigate inflationary pressures despite the capacity expansion of 10.1 per cent.

The Group's net profit increased by 146.7 per cent to USD 1.63 billion, mainly due to a one-off non-cash accounting gain of USD 1.1 billion from the merger of Air India and Vistara in November 2024. For the nine months ending December 2024, SIA Group achieved USD14.72 billion in revenue, an increase of 3.3 per cent from the previous year. Operating expenditure rose by 10 per cent, primarily driven by capacity expansion and fuel volume increases. Despite the dip in operating profit, net profit remained higher due to the merger gain.

The Group's balance sheet remains robust, with shareholder equity at USD 15.4 billion. Cash balances fell slightly due to bond redemption and other financial activities. The Group maintains substantial liquidity, including USD 3.3 billion in drawn credit lines.

Looking ahead to the SIA Group that anticipates sustained demand for air travel, especially in e-commerce and perishables, while acknowledging geopolitical tensions and economic uncertainty.

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