Singapore Airlines Profit Tumbles 81% as Fuel Costs Sting

Nov 13 2018, 10:41 AMNov 13 2018, 12:07 PMNovember 13 2018, 10:41 AMNovember 13 2018, 12:07 PM

(Bloomberg) -- Singapore Airlines Ltd. reported an 81 percent plunge in second-quarter profit as higher fuel costs weighed on earnings.

Net income for the three months through September fell to S$56.4 million ($41 million) from S$293.3 million a year earlier. Sales rose 5.6 percent to S$4.06 billion.

Singapore Airlines shares have fallen 12 percent this year, compared with a 10 percent decline in the Straits Times Index.

The airline will pay shareholders an interim dividend of 8 Singapore cents per share.
Fuel costs climbed 24 percent to S$1.16 billion in the quarter as average Brent prices soared 46 percent from a year earlier.
A fuel-hedging gain of S$151.7 million helped defray some of those expenses. A year earlier, Singapore Airlines recorded a hedging loss of S$3.3 million.
Losses from associate companies amounted to S$117.1 million in the quarter, largely due to accounting adjustments made for its Virgin Australia shares.
Singapore Airlines is expected to tap the debt market after raising S$600 million last month to pay for new aircraft. The carrier expects to take delivery of more Airbus SE A350s and Boeing Co. 787-10s, and also has 777-9 planes on order.