Singapore Airlines (SIA) reports a 2.1 per cent increase in flown cargo revenue for the financial year 2018/19 to SGD 45 million (USD 32.75 million).
The carrier, which now reports cargo as part of the larger airline group following reintegration into the group in April 2018, notes that cargo yield growth (+5.7 per cent) to reach 31.7 cents per ltk, was more than sufficient to offset lower loads carried (-3.5 per cent) as a result of the softening trade environment. The carrier registered 7.0 billion tonne kms in the year.
Overall SIA registered a slight decline in cargo tonnage, down 0.2 per cent to 1,298 million kg during the financial year 2018/19 year-on-year.
SIA also reports a sharper contraction during the fourth quarter, ended 31 March, reflecting industry trends, which saw the carrier’s cargo revenue drop 6.6 per cent on lower loads (-6.8 per cent), “a reflection of the difficult trade conditions during the quarter,” it adds.
Overall, the SIA Group reports a solid operating profit of SGD 1.07 billion for the 2018/19 financial year. Although a decline from last year’s operating profit of $1.55 million (-31.1 per cent), the Group’s underlying performance was strong against the backdrop of a SGD 1 billion increase (+25.1 per cent) in fuel cost. The Group reported its highest ever annual revenue of SGD 16.3 billion.
Looking forward, the carrier says its cargo operations will continue to pursue charter opportunities and deploy capacity to match demand.
“Notwithstanding the current demand picture, ongoing trade disputes and slowing economic growth in key markets pose uncertainty to the operating environment. Efforts will be made to capture opportunities and mitigate any arising weaknesses in both cargo and passenger segments,” it adds.
Part of this involves fuel hedging where the SIA Group, for the financial year 2019/20, has hedged 64 per cent of its fuel requirement in MOPS and 5.0 per cent in Brent at weighted average prices of USD 76 and USD 53 per barrel, respectively.