SIA records S$2.7B profit for FY2024; Staff to receive 8-month bonus

Source: Gutzy Asia
Author: Yee Loon

SINGAPORE: Singapore Airlines (SIA Group) employees are reportedly set to receive a lucrative profit-sharing bonus equivalent to 7.94 months' salary.

This announcement comes on the heels of the group achieving its highest-ever full-year operating and net profits in the previous fiscal year.

The news was initially reported by international media Bloomberg, citing a person familiar with the matter.

In a statement issued on Wednesday (15 May), SIA Group attributed its robust financial performance to the sustained demand for air travel, resulting in record-breaking passenger revenue and load factors.

The Group reported earnings of S$1.2 billion for the second half of the fiscal year 2024 ended in March, reflecting a marginal year-on-year increase of just 0.3%.

During the same period, revenue experienced a more notable increase, rising by 5.3% year-on-year to S$9.85 billion, although air travel demand, while still growing, moderated somewhat due to increased competition.

For the full fiscal year, the flag carrier achieved record earnings of S$2.68 billion (US$1.99 billion) for FY2024, marking a remarkable 24% year-on-year increase, with some assistance from exceptional items amid the industry's sustained recovery.

However, excluding these exceptional items, SIA's operating profit for the year saw a more modest increase of just 1.3% to S$2.73 billion.

This translates to an earnings per share (EPS) of 61.4 cents, representing a significant improvement from 35.1 cents.

Throughout the year, both SIA and its low-cost unit Scoot collectively accommodated 36.4 million passengers, reflecting a substantial 37.6% increase year-on-year.

Notably, there was an improvement in the Passenger Load Factor (PLF) by 2.6 percentage points, reaching a record high of 88.0%.

SIA and Scoot achieved impressive individual PLFs of 87.1% and 91.2%, respectively.

However, there was a slight decrease in Revenue per Available Seat Kilometre (RASK), dropping to 9.6 cents, marking a 4.0% decline compared to the record of 10.0 cents in FY2022/2023.

Conversely, cargo-flown revenue experienced a significant decline of 41.2% year-on-year, totalling just $2.1 billion.

Nevertheless, there was a slight increase of 1.7% in cargo loads, primarily driven by robust demand from the e-commerce sector. Despite a 42.2% year-on-year decrease in cargo yields, they remained 29.8% higher than pre-pandemic levels.

During the period, the group's total expenditure grew by 8.0% year-on-year, reaching S$16.3 billion, notably driven by a 13.5% increase in non-fuel expenditure, totalling S$1.34 billion.

Conversely, fuel costs dropped by 2.5% in line with lower fuel prices.

As of 31 March 2024, cash and cash equivalents stood at S$11.27 billion, down from S$16.33 billion in FY2022/2023.

In light of these financial results, the group has proposed a final dividend per share of 38 cents, resulting in a full-year payout of 48 cents.

This marks an increase from the total dividend payout of 38 cents in the previous year.

In its outlook statement, the group highlights the continued robust demand for air travel in the first quarter of FY2024/25, buoyed by a significant increase in forward bookings to North Asia and Southeast Asia (SEA).

However, the aviation industry faces persistent challenges, including escalating geopolitical tensions, an uncertain macroeconomic climate, supply chain constraints, and heightened inflation on a global scale.

"The SIA group is well-positioned to seize emerging growth opportunities and navigate uncertainties thanks to its strong foundations and long-term strategic initiatives," says the group.

As of 31 March, the Group's operating fleet consisted of 200 aircraft with an average age of seven years and three months.

SIA had 142 passenger aircraft4 and seven freighters, while Scoot had 51 passenger aircraft5. In April 2024, the Group added one Airbus A350-900 and two Embraer E190-E2 aircraft to its fleet.