Singapore Airlines - UOB Kay Hian 2024-02-22: 3QFY24 Results Miss Mainly On Cost Pressure

• Singapore Airlines (SIA)’s 3QFY24 headline net profit of S$659m (+4.9% y-o-y, -6.8% q-o-q) came in below our guided range of S$670m-810m, even though 3QFY24 was already helped by some one-offs such as tax credit and disposal gains.
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3QFY24 results missed...

• Singapore Airlines (SIA)'s 3QFY24 headline net profit of S$659m (+4.9% y-o-y, -6.8% q-o-q) missed our guided range of S$670m-810m.
• Note that SIA’s 3QFY24 headline net profit was already helped by one-offs including a one-time tax credit (size not disclosed, but we estimate it to be close to S$100m) and asset disposal gains (about S$10m by our estimate), partly offset by some forex losses (about S$30m by our estimate). Excluding the impact of one-offs, the miss would have been more significant.

…mainly on cost pressure.

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• Apart from non-fuel cost pressure, 3QFY24 fuel cost per ATK (22.4 cents, +8.9% q-o-q) also stood at the higher end of our forecast range, while cargo yield (40.3 cents, +2.9% q-o-q, -37.4% y-o-y) was at the lower end of our forecast range. The negative impacts of these items on SIA’s earnings have been partly offset by the strength in pax yields (11.2 cents, +3.5% q-o-q, -7.4% y-o-y), which stood at the higher end of our expected range.

Healthy forward booking...

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Roy Chen CFA UOB Kay Hian Research | https://research.uobkayhian.com/ 2024-02-22 SGinvestors.io

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