SATS - UOB Kay Hian 2022-11-10: 2QFY23 Core Losses Narrowing; Likely To Return To Profitablity Next Quarter

SATS - 2QFY23 Core Losses Narrowing; Likely To Return To Profitablity Next Quarter

Published:
SATS LTD. (SGX:S58) | SGinvestors.ioSATS LTD. (SGX:S58)
  • Excluding government reliefs, one-offs and professional fees related to the WFS deal, SATS’ core net loss stood at S$5m-10m in 2QFY23, a meaningful improvement over 1QFY23’s ex-relief core net losses of S$31.9m.
  • - Read this at SGinvestors.io -
  • Management has updated its financing plan for the WFS deal to use only straight equity and more debt.
  • Maintain BUY recommendation on SATS with an unchanged target price of S$3.08.

Meaningful improvement in SATS' core profitability.

  • SATS (SGX:S58) recorded headline net losses of S$9.9m in 2QFY23 (1HFY23: S$32.5m losses). Stripping out a one-off disposal gain of S$1.9m and government reliefs of S$11.4m, SATS’ 2QFY23 core net loss stood at S$21.6m in 2QFY23.
  • - Read this at SGinvestors.io -
  • Passenger business volume continued to recover; a slight dip in air cargo volume. In line with the aviation sector’s recovery, SATS’ business volume continued to recover in 2QFY23 – the volume of flights handled, meals served and passengers handled rose 20.0%, 28.7% and 29.9% q-o-q respectively.
  • Cargo tonnage handled declined 2.6% q-o-q, likely due to a normalisation of the air cargo business from the pandemic high and the slower near-term demand amid the weakening macroeconomic outlook.
  • Group revenue rose 14.2% q-o-q to S$429m in 2QFY23, driven by q-o-q higher revenue across all regions.

Expecting a turnaround for SATS in 3QFY23.

  • Read more at SGinvestors.io.




Above is the excerpt from report by UOB Kay Hian Research.
Clients of UOB Kay Hian may be the first to access the full report in PDF @ https://www.utrade.com.sg/.




Roy Chen CFA UOB Kay Hian Research | https://research.uobkayhian.com/ 2022-11-10



Read also UOB's most recent report:
2023-10-16 SATS - Gradually Improving Outlook With Stablising Global Air Cargo Demand.

Previous report by UOB:
2023-08-16 SATS - 1QFY24 Core Performance In Line; Focusing On Integration & Synergy Delivery.

Price targets by 4 other brokers at SATS Target Prices.

Listing of research reports at SATS Analyst Reports.

Relevant links:
SATS Share Price History,
SATS Announcements,
SATS Dividends & Corporate Actions,
SATS News Articles





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