- SATS' 1QFY26 PATMI soared 9.1% y-o-y to S$70.9mil, outperformed our expectation at 30% of our FY26e forecast underpinned by strong cargo demand from front-loading activities. Cargo tonnage reached 2.4mil (+10.4% y-o-y), flight movements totalled 158.8k (+2.6%YoY), and aviation meal production grew to 16.4mil (+5.6%YoY).
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The Positives
Cargo demand supported by front-loading activities.
- Gateway Services revenue reached S$1.18bn, an 11.2% y-o-y increase. This growth was fueled by portfolio expansion, following new contracts with key carriers such as Cathay Cargo, Cathay Pacific, and Emirates SkyCargo.
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- While the US cargo market softened as expected, with volumes dropping q-o-q, SATS mitigated losses by securing orders from domestic express services (DHL, UPS, Amazon), offsetting the impact from the cancellation of the De Minimis Exemption.
Resilient margin despite tariff uncertainties.
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