- Singapore Airlines (SIA) reported net profit of S$601.9m in 4QFY23 (-4.2% q-o-q, vs net loss of S$209.9m in 4QFY22), marking the highest fourth quarter profit since FY07.
Yet another record quarter for SIA's earnings, surpassing the street’s expectation.
- - Read this at SGinvestors.io -
- SIA incurred a considerable FX loss of S$212.8m in FY23, primarily the result of a depreciation in the US$ and its net-long US$ position. While the group is typically net short in US$ as a sizable portion of expenses is denominated in US$, it was temporarily net long in US$ as significant proportion (42.4%) of its massive cash and bank balances were held in US$. Barring this development, SIA’s net profit would have been even more impressive.
Group revenue of S$4,511.9m in 4QFY23 was down 6.9% q-o-q due to seasonality but up 82.5% y-o-y.
- - Read this at SGinvestors.io -
- Passenger yields at the flagship carrier, SIA, and Scoot stayed robust in 4QFY23, and were 20% and 37% above pre-pandemic levels respectively. Similarly, passenger load factors sustained above historical levels at 86.3% and 91.5% at SIA and Scoot respectively, marking a record high for the group’s low-cost carrier.
- Unsurprisingly, freight volumes and freight rates continued to descend during the quarter, burdened by sluggish demand amid macroeconomic challenges.
- Unit costs (CASK) declined by 4.1% q-o-q at SIA but climbed by 9.4% q-o-q at Scoot in 4QFY23. As a group, ex-fuel unit cost per ATK rose by 5.6% h-o-h and 6.4% y-o-y in 2HFY23, primarily attributable to an acute increase in staff costs which more than offset improvements in other areas.
- Staff costs soared above pre-pandemic levels in 2HFY23 even though capacity was not fully restored. A substantial part of the hike is attributed to an increase in bonus provision (linked to SIA’s performance) and to a lesser extent, wage inflation.
Operating cash flow of S$9.1bn is the highest in history
- Read more at SGinvestors.io.
Above is the excerpt from report by DBS Group Research.
Clients of DBS may access the full report in PDF @ https://www.dbs.com/insightsdirect/.
Paul YONG DBS Group Research | Jason SUM CFA DBS Research | Tabitha FOO DBS Research | https://www.dbs.com/insightsdirect/ 2023-05-18
Previous report by DBS:
2023-02-23 Singapore Airlines - A Cut Above The Competition; 3QFY23 Results Setting New Highs.
Price targets by 3 other brokers at SIA Target Prices.
Listing of research reports at SIA Analyst Reports.
Relevant links:
SIA Share Price History,
SIA Announcements,
SIA Dividends & Corporate Actions,
SIA News Articles
