SINGAPORE (July 17): SIA Engineering Company (SIA EC) posted net profit of $10.7 million in 1Q20/21 ended June, 74.3% lower than the $41.6 million in 1Q19/20.
The steep decline was attributable to historically low flight frequencies due to the Covid-19 pandemic, said the group in a Friday filing.
SIA EC says the number of flights handled in its Singapore base for this quarter was only about 13% of what the group used to handle before the outbreak.
The group adds that its financial performance for this quarter was cushioned by the grants from government support schemes. Without the support, it says it would have recorded a loss of $36.7 million for the quarter.
Revenue for 1Q slid 54.1% y-o-y to $118.5 million.
Expenditure fell 47.1% y-o-y to $113.3 million due to cost measures and government grants.
In all, SIA EC reported an operating loss of $8.6 million compared to an operating profit of $17.7 million in the same period last year.
The group’s share of profits of associated and joint venture (JV) companies declined 47.3% y-o-y to $13.7 million. This was largely due to reduced contributions from its associated and JV companies, who were also seeing reduced flying hours and extended maintenance intervals.
The group reported earnings per share (EPS) of 0.96 cents, and net asset value (NAV) per share of $1.45, as at June 30.
Looking ahead, the group says while flight activities have increased in June, the increase was “not material”. With no certain indication of higher flight frequencies, it says the outlook for its maintenance, repair, and operating supply (MRO) business will be “challenging”.
Shares in SIA EC closed 2 cents higher, or 1.0% up, at $1.96 on Friday prior to the announcement.
See also: SIA Engineering braces for full Covid-19 impact; reviews JVs and mulls M&A opportunities
