Singapore Airlines reports sharp drop in third quarter profits

Singapore Airlines has reported a drop its net profits of 42.8 per cent for the third quarter, ended 31 December, on decreased passenger and cargo traffic. It cited the global economic downturn as the reason for the decline in profits.

The carrier, one of Asia’s dominant airlines, is forecasting a bleak outlook for 2009, in line with the projections made by economists that financial conditions will worsen before improvements are seen.

Singapore Airlines is latest of the major carriers to report either a loss or a major drop in profits during the current economic slowdown, which has significantly affected travel worldwide.

Net profits for the quarter were reported to be 337 million Singapore dollars, down from 590 million dollars, on revenues of 4.16 billion dollars. Revenues for the quarter were down by 2.6 percent from the same quarter in the previous year, Singapore Airlines indicated in a statement.

The airline also reported that it carried 4.8 million passengers during the third quarter, which was a decline of 4.2 per cent over the same quarter in 2007, as passenger demand was hit by economic conditions.

Cargo was down by 14.2 per cent for the quarter, which was in line with the decline in global trade, as economics around the world are affected by the financial crisis.

“Demand for air transportation is expected to remain weak for much of 2009,” the airline warned. “The company will continue to monitor the patterns of demand and make appropriate adjustments to flight schedules and capacity while managing costs tightly.”

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