Singapore Airlines shares sink to new low after US$815m quarterly lossBusiness | 30 Jul 2020 2:05 pm
Singapore Airlines reported a S$1.12 billion (US$815 million), net loss in the first quarter yesterday after drastically cutting capacity due tovirus travel restrictions
This is compared to the S$111 million profit in the same period a year ago.
Shares fell today to their lowest price in more than 21 years after the carrier posted its biggest quarterly loss ever. The stoch fell by 5.1 percent to S$3.35, the lowest intraday price since September 1998, before paring to S$3.40 as of 1:44 p.m. in Singapore.
Revenue for the group plunged 79.3 percent year-on-year to S$851 million in the first quarter ended Jun 30, while expenditure dropped 51.6 per cent to S$1.89 billion.
Overall passenger carriage fell 99.5 percent - 99.4 per cent for Singapore Airlines, 99.8 percent for SilkAir and 99.9 per cent for Scoot.
"The group entered the first quarter at a time when market conditions were deteriorating rapidly due to the spread of the coronavirus globally," said SIA.
"Demand for air travel evaporated as travel restrictions and border controls were imposed around the world to contain the spread of the virus."
The drop in passenger flown revenue was partially offset by improvements in cargo flown revenue, said SIA, noting the "strong demand" for the transport of personal protection equipment, pharmaceuticals and fresh foods.
"In addition to maximising freighter utilisation, SIA has proactively deployed passenger aircraft on cargo missions to further boost cargo capacity," it added.
Singapore Airlines said it was in talks with aircraft manufacturers to delay deliveries and progress payments to reduce cash outflows at a time when the majority of its fleet of 220 planes remains parked.
"We have reached agreement with Airbus on some of these matters and discussions with Boeing are ongoing," it said.
The airline added that it is reviewing the size and shape of its fleet over the longer term, which is likely to lead to a material impairment in the value of older aircraft, particularly the Airbus A380, which would account for S$1 billion.
SIA plans to operate around 7 per cent of its normal passenger capacity in August and September.