Singapore Airlines clocks second-best quarterly profit on record

Singapore Airlines Ltd. shrugged off rising fuel costs to deliver its second-biggest quarterly profit on record as demand for flights kept airfares elevated.

Net income in the second quarter through September climbed 27% from a year earlier to S$707 million ($522 million), the carrier said in a statement Tuesday. Revenue rose 4.3% to S$4.7 billion.

Demand remains strong in the rebound from Covid — including low-cost unit Scoot, Singapore Airlines’ passenger traffic totaled 8.9 million in the quarter, up 42% from a year earlier. Group capacity is expected to reach about 92% of pre-pandemic levels on average in December.  

Singapore’s flag carrier warned that air travel returning to normal puts pressure on yields. It also flagged heightened geopolitical and macroeconomic risks that will “continue to pose challenges for the airline industry.”

The price of oil soared about 28% during the quarter, squeezing airlines as jet fuel is one of their biggest costs. Singapore Airlines said its net fuel costs rose 13.6%. 

Passenger load factor, an indicator of how full planes are, was 88.6%, up 2 percentage points from the same period last year.

Singapore Airlines shares fell 1.4% ahead of the earnings Tuesday, trimming their gain this year to about 13%. That’s still the fifth-best performer on the Bloomberg World Airlines Index, which is down 8% in 2023.