Singapore Air profit almost triples

Net income rose to S$256.6m in the three months ended in June from S$91.2m a year earlier

Singapore Airlines Ltd reported first-quarter profit almost tripled as lower oil prices reduced costs and the company benefited from the sale of a stake by its subsidiary.

Net income rose to S$256.6 million ($190 million) in the three months ended in June from S$91.2 million a year earlier, the carrier said in a Singapore stock exchange statement yesterday. Sales fell 2 per cent to S$3.6 billion.

Non-operating income jumped to S$148.1 million after SIA Engineering Co. profited from the sale of its stake in Hong Kong Aero Engine Services Ltd, coupled with S$36 million in special dividends from the Hong Kong company, according to the statement.

Singapore Air benefited from an increase in passenger numbers in the quarter as economic growth from China to Southeast Asia to India allowed more people to travel for work and leisure.

Chief Executive Officer Goh Choon Phong has ordered $10 billion of new aircraft to take on competition as AirAsia Bhd, Emirates and Etihad Airways chip away market shares of Singapore Air and low-cost units Tiger and Scoot.

Shares of Singapore Air rose 0.7 per cent to close at S$11.20 before the earnings announcement.

The parent airline’s yields, or revenue earned from a passenger for flying a kilometre, fell to 10.3 Singapore cents in the first quarter, from 10.7 cents a year earlier.

The carrier posted its lowest passenger yield in six years in the 12 months through March, with CEO Goh saying pressure is being felt across the industry. Cathay CEO Ivan Chu said this month that there is “intense pressure on yield.”