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Singapore Airlines - CGS-CIMB Research 2023-11-08: Somewhat Overcast Skies Into 2HFY24

Singapore Airlines - Somewhat Overcast Skies Into 2HFY24

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SIA (SGX:C6L) | SGinvestors.ioSIA (SGX:C6L)
  • SIA (SGX:C6L) delivered an estimated 2QFY24 (Jul to Sep 2023) core net profit of S$648m, in line with our S$600m- 650m preview forecast.
  • The 2QFY24 EBIT of S$799m was 5.9% higher than 1QFY24’s S$755m, but we believe that after stripping out forex gains, the 2Q EBIT may actually be lower than the immediately-preceding 1Q.

Decent 2QFY24, albeit weaker than 1QFY24 on higher fuel prices

  • - Read this at SGinvestors.io -
  • Scoot’s core EBIT fell 24% q-o-q to S$9m, while
  • cargo’s core EBIT fell 97% to S$2m.
  • All were affected by the rise in jet fuel prices compared with 1QFY24, but the cargo business was also impacted by the 9% q-o-q drop in RAFTK (due to excess global airfreight capacity), while Scoot saw its RASK (revenue per available seat kilometre capacity) fall 3% q-o-q, as it expanded into less-lucrative routes. Only SQ managed to eke out a 0.5% q-o-q rise in its RASK during 2QFY24, but this was a major deceleration compared with the 9% q-o-q jump during 2QFY23.
  • - Read this at SGinvestors.io -
  • PLFs (passenger load factor) at both SQ and Scoot remained very high y-o-y, but declined between 30-70bp q-o-q.

    • Topline may come under competitive pressure

    • Read more at SGinvestors.io.



    Above is the excerpt from research report by CGS-CIMB.
    Clients of CGS-CIMB may access the full report in PDF @ https://www.itradecimb.com.sg/.



    Raymond YAP CFA CGS-CIMB Research | https://www.cgs-cimb.com 2023-11-08


    Read also CGS-CIMB's most recent report:
    2024-01-09 Singapore Airlines - Upgrade To ADD For Big Returns Over Half Year.

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