SIA profit down 65% in turbulent Q3
SINGAPORE Airlines (SIA) said yesterday that its third-quarter net profit fell 65 per cent from the previous year, weighed down by a huge legal settlement in the United States and losses from associated companies.
The flag carrier said in a statement that net profit in the three months ended December was S$50.1 million, down from S$142.5 million in the same quarter the year before.
It said the figure was dragged down by a S$78 million settlement in a class-action suit filed in the US against its freight arm, SIA Cargo.
SIA Cargo in December agreed to the settlement with plaintiffs, without admitting to any wrongdoing or liability.
The class action was taken against the Singapore carrier as well as other airlines in 2006, following investigations into price-fixing in air-cargo services in the US.
SIA said it also lost S$46 million due to diminished value of its assets and its share of losses in associated companies, mainly budget carrier Tiger Airways.
Without the one-off losses, net profit would have risen by 23.1 per cent, it said.
"The outlook for the air-transport industry continues to be challenging, with airlines offering aggressive fares amid increasing capacity, and fuel prices remaining high by historical standards," SIA said.