SIA (SGX:C6L) reported net profit of S$52mil (-82.1% y-o-y), bringing 1HFY26 net profit to S$239mil, representing 29% and 23% of DBS and consensus full year estimatesrespectively.
2QFY26 net profit significantly below both DBS and the street’’s estimates.
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While mainline carrier SIA achieved higher-than-expected passenger yields (-0.9% y-o-y) and load factor (+1.8ppts y-o-y), Scoot saw an acute 7.8% y-o-y decline in passenger yields despite higher load factor of 91.4% (+3.1ppts y-o-y) and the cargo segment faced lower yields (-3.3% y-o-y) and load factor (-1.0ppt y-o-y).
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Capital return initiative should be well-received by market.
More notably, it announced a multi-year capital return plan comprising 10 cents/share of special dividends annually for the next three years, amounting to ~S$900mil over the period. The first interim special dividend was declared at 3 cents, bringing total dividends for 1HFY26 to 8 cents/share. The special dividend was a positive surprise and reflects SIA’s strong financial position, underscoring management’s commitment to shareholder returns and providing support for SIA's share price.
Overall travel demand remains stable, with the near-term outlook still favourable.
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Above is an excerpt from a report by DBS Group Research. Clients of DBS may access the full PDF report @ https://www.dbs.com/insightsdirect/.
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