SATS - OCBC Investment 2023-06-01: Successful Integration Of WFS Will Be Key

SATS - Successful Integration Of WFS Will Be Key

SATS (SGX:S58) | SGinvestors.ioSATS (SGX:S58)
  • SATS (SGX:S58)’s 4QFY23 revenue rose 59.6% y-o-y to S$478.1m, boosted by stronger performances from both Gateway Services (+81.0% y-o-y) and Food Solutions (+42.3% y-o-y), on the back of a continued recovery in aviation. On a q-o-q basis, 4QFY23 revenue was up marginally by 0.5% due to seasonality impact (3Q is typically a strong quarter).
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  • Excluding the impact of government relief of S$19.7m (no more relief to be recognised in FY24), SATS's PATMI would have been at a loss of S$12.2m during the quarter, compared to a loss of S$13.7m in 3QFY23.
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Operating statistics improved but cargo demand was weaker

  • SATS’s operating statistics continued to show an uptick in 4QFY23 on the back of a recovery in the aviation industry. Despite being a seasonally weak quarter, SATS’s flights handled improved by 7.0% q-o-q in 4QFY23 while passengers handled grew 5.6% q-o-q. Separately, meals served rose 11.2% q-o-q.
  • On the other hand, cargo demand weakened with volume processed declining 9.9% q-o-q due to macroeconomic headwinds.
  • Comparing to pre-COVID levels, SATS’s flights handled, meals served and passenger handled in 4QFY23 recovered to 76%, 91% and 72% respectively. On a same-store basis, cargo volume was at 90% of pre-COVID levels or 127% with the inclusion of Asia Airfreight Terminal (AAT).

Cost savings from earlier redemption of WFS’ bonds

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Above is the excerpt from report by OCBC Investment Research.
Clients of OCBC Securities may be the first to access the full report in PDF @

OCBC Research Team OCBC Investment Research | 2023-06-01

Read also OCBC's most recent report:
2024-05-31 SATS - Charting A Flight Path Towards Sustainable Growth.

Previous report by OCBC:
2024-02-29 SATS - Start Of The Runway.

Price targets by 2 other brokers at SATS Target Prices.

Listing of research reports at SATS Analyst Reports.

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SATS Dividends & Corporate Actions,
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