Singapore Airlines (SIA) Group has released its financial results for the third quarter of the fiscal year 2024/25, showcasing a period of robust growth amidst a challenging aviation landscape.
The group achieved a record revenue of $5,219 million in the three months ending December 31, 2024, a 2.7% increase from the same period last year.
This surge is primarily attributed to the continued strong demand for air travel during the quarter.
Net profit saw a substantial increase of $967 million, or 146.7%, reaching $1,626 million. This was largely attributed to the Vistara-Air India merger.
Passenger Traffic Reaches New Heights
Passenger flown revenue saw a $70 million increase, reflecting a 1.7% rise. Notably, Singapore Airlines and its low-cost subsidiary, Scoot, transported a record-breaking 10.2 million passengers. This was a 7.2% jump compared to the third quarter of the previous fiscal year.
However, this growth in passenger traffic was slightly outpaced by an 8.5% increase in capacity. This resulting in a marginal 1.0 percentage point decrease in the passenger load factor, settling at 87.2%.
The airline industry’s increased capacity injection has intensified competition. It led to a 4.5% drop in passenger yields, which now stand at 10.7 cents per revenue passenger-kilometre.
Cargo Division Delivers Strong Performance
The Singapore Airlines cargo division also demonstrated a strong performance, with cargo flown revenue rising by $54 million, a 9.7% increase.
This growth was driven by a 14.6% year-on-year rise in cargo loads, boosted by robust e-commerce activity, It saw increased freighter charters, and a surge in perishables traffic.
Cargo capacity expanded by 12.8%, resulting in a 0.9 percentage point increase in the cargo load factor, reaching 56.4%. Similar to passenger yields, cargo yields experienced a 4.5% decrease.
Net Profit Boost from Vistara Merger
The group’s net profit saw a substantial increase of $967 million, or 146.7%, reaching $1,626 million.
This remarkable growth is largely attributed to a $1,098 million non-cash accounting gain resulting from the disposal of Vistara, following its merger with Air India in November 2024.
Nine-Month Performance Highlights Solid Growth
For the nine months ending December 31, 2024, the group achieved a record revenue of $14,716 million. This was a $472 million, or 3.3%, increase compared to the same period in the previous year.
This growth was driven by increases in both passenger and cargo flown revenue. However, heightened competition resulted in lower passenger and cargo yields.
Operating expenditure increased by $1,210 million, or 10.0%, in line with the overall capacity expansion. Despite a lower operating profit, the group’s net profit was $268 million higher, again bolstered by the Vistara merger.
Managing Costs Amidst Growth
Group expenditure increased by $117 million, or 2.6%, to $4,590 million. This was primarily due to a $258 million increase in non-fuel expenditure, reflecting an 8.6% rise. However, this was partially offset by a $142 million, or 9.8%, decrease in net fuel costs.
Effective cost management strategies allowed the group to keep the rise in non-fuel expenditure below the overall capacity growth of 10.1%, despite ongoing inflationary pressures.
Consequently, the group reported an operating profit of $629 million for the quarter. This represented a $20 million, or 3.3%, increase compared to the same period in the previous year.
Fleet Expansion and Network Growth
As of December 31, 2024, the group’s operating fleet consisted of 207 passenger and freighter aircraft, with an average age of seven years and six months. SIA added an Airbus A350-900, while Scoot expanded its fleet with three Embraer E190-E2 aircraft.
The group continues to expand its network, with SIA launching services to Beijing Daxing and Scoot commencing operations to new destinations in Malaysia and Vietnam.
Future plans include the introduction of new routes to the Philippines and Austria, and increased services to Australia, Sri Lanka, and South Africa.
Singapore Airlines Group Outlook
Looking ahead, the demand for air travel is expected to remain strong. However, the Singapore Airlines Group anticipates continued competition and yield moderation. The cargo division expects sustained demand, but also anticipates yield pressures due to increased industry capacity.
The group acknowledges potential headwinds, including cost inflation, supply chain constraints, geopolitical tensions, economic uncertainty, and heightened competition.
However, they are confident in their ability to navigate these challenges, leveraging their strong financial standing, talented workforce, and industry-leading digital capabilities.
Strategic partnerships and a diversified airline portfolio will enable the group to capitalize on growth opportunities.
Furthermore, a continued focus on service excellence, network connectivity, and product leadership will enhance the customer experience and solidify the group’s position as an industry leader.
Click the banner to subscribe to our weekly newsleter.
Click the photo to join our WhatsApp channel so then you can stay up to date with everything going on in the aviation industry!
