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UPDATE 1-Singapore Airlines' Q2 loss narrows on cost cuts, air travel pick-up

UPDATE 1-Singapore Airlines' Q2 loss narrows on cost cuts, air travel pick-up

reuters.com · 11/11/2021 05:41
UPDATE 1-Singapore Airlines' Q2 loss narrows on cost cuts, air travel pick-up

Cargo revenue at record highs on freight demand

Monthly operating cashflow nears breakeven levels

Passenger capacity to reach 43% of pre-COVID levels by December

Adds revenue, cashflow details and capacity outlook

By Jamie Freed

- Singapore Airlines Ltd (SIA) SIAL.SI said on Thursday market conditions were improving after it reported a narrower second-quarter loss due to cost-cutting efforts, record cargo revenue and an improvement in passenger numbers from a low base.

The net loss of S$427.6 million ($315.6 million) for the three months to Sept. 30 was down from a record S$2.34 billion loss a year earlier, when COVID restrictions hammered air travel and the airline took large impairment charges on older planes.

It posted a net profit of S$94.5 million in the September quarter of 2019.

Revenue doubled in the second quarter to S$1.53 billion due to strong cargo demand and a four-fold rise in passenger numbers from a very low base.

The airline said monthly operating cashflows were near breakeven levels and it expected passenger capacity to reach 43% of pre-pandemic levels by December, serving half of its previous destinations.

In September, passenger capacity reached around 32% of pre-pandemic levels, though on average it filled only 20% of the seats on its planes. nL4N2P529X

Singapore has recently opened vaccinated travel lanes without quarantine with more than a dozen countries including Britain, the United States, Germany, Australia and South Korea.

Neighbouring Malaysia will be added to the list from Nov. 29, allowing for more flights between Singapore and Kuala Lumpur, one of the world's busiest international routes before the pandemic. nP8N2N401B

The airline will restart Singapore-London flights on its flagship Airbus SE AIR.PA A380 super-jumbos on Nov. 18 and will fly them to Sydney from Dec. 1. nFWN2S2198

SIA, like Hong Kong-based rival Cathay Pacific Airways Ltd 0293.HK, has no domestic market and has been hard-hit by border closures.

Singapore has capped daily arrivals for the vaccinated travel lanes, meaning the allowable traffic is in the single-digit percentages of pre-pandemic passenger numbers.

But it is an encouraging sign for travel in the Asia-Pacific region, which had had some of the world's toughest border controls during the pandemic. nL4N2R90BM

SIA's management team will hold a results briefing for analysts and media on Friday.

(Reporting by Jamie Freed in Sydney; Editing by Susan Fenton and Jan Harvey)