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Singapore Airlines Propels Profits to Uncharted Altitudes


  • Singapore Airlines posts an annual net profit of S$2.68 billion, driven by robust travel and cargo demand.

  • Despite the profit, the airline flags ongoing challenges including geopolitical tensions, supply chain issues, and fierce competition.


By Falito Villienuve Tandra, Salma Farah Faiza, and Iman Satyo Adi

25 May 2024 at 16:30 GMT+7


Singapore Airlines (SIA) has announced a record annual profit of S$2.68 billion for the fiscal year ending March 2024, reflecting disciplined capacity management and strategic expansion. ⁤⁤This remarkable achievement aligns with strong travel demand in North Asia and increasing freight demand as the fiscal year comes to an end. ⁤⁤This year, the airline also increased its final dividend from 28 cents to 38 Singapore cents per share. ⁤⁤


High load factors and significant growth in talent and resources are important factors contributing to Singapore Airlines' success. ⁤⁤These factors have not only enhanced the airline's own performance but have also influenced the strategies adopted by other airlines in the Asia-Pacific region.



⁤⁤⁤Although the airline has seen success, it still faces persistent obstacles like supply chain limitations, rising prices, and geopolitical concerns, all of which it continues to strategically navigate. Singapore Airlines has established a precedent for the industry and paved the path for future growth and leadership with its strong performance, which showcases its resilience and adaptability in a complex and competitive global market.


Singapore Airlines A350-900 | Source: KITTIKUN YOKSAP/Shutterstock


Despite facing a multitude of global challenges, Singapore Airlines achieved unprecedented financial success in FY2023/24. The airline reported record revenues and profits, undeterred by geopolitical tensions and economic uncertainties. Compared to the previous year, SIA saw significant year-on-year increases across all major financial metrics, including revenue, operating profit, and net profit.


The company's operating profit surged by 40%, while net profit more than doubled, showcasing its robust financial health and strategic prowess. This financial uplift was further bolstered by a substantial rise in passenger numbers, with load factors reaching new heights.


The impressive growth in passenger traffic not only highlights the airline's successful market strategies but also underscores its ability to attract and retain a growing customer base. Singapore Airlines' remarkable performance sets a new benchmark in the aviation industry, demonstrating its resilience and capacity to thrive amidst global adversities.



Singapore Airlines CEO, Goh Choon Phong | Source: Reuters


Building on this momentum, Singapore Airlines Group (SIA) leveraged its competitive edge by rapidly increasing capacity in reopening markets and achieved record net profits in FY2023/24. The group reported revenues of S$19.01 billion, an operating profit of S$2.73 billion, and a net profit of S$2.68 billion, reflecting year-on-year increases of 7.0%, 1.3%, and 24.0% respectively.



This success was driven by a 22.9% rise in capacity and a 26.6% increase in demand, boosting the load factor to 88.0%. SIA swiftly added capacity on previously successful routes when restrictions in key markets like China and Japan were lifted, gaining a first-mover advantage.


Moving forward, SIA's strategy focuses on sustaining demand and adapting to evolving market conditions. The group will continue to closely monitor market trends and adjust its network accordingly, ensuring they maintain the successful practices that led to their record results. This proactive approach aims to keep SIA ahead of growing competition in the Asia-Pacific region.


 

Sources:

Bloomberg

CNBC

IDX

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