NICHOLAS IONIDES / SINGAPORE
Singapore Airlines (SIA) has reported operational losses for the first time in its history in the wake of the SARS-induced downturn in the first quarter.
Group operating loss for the three months ended 30 June amounted to S$377 million ($215 million), compared with an operating profit for the same period last year of S$244 million. SIA suffered a net loss of S$312 million, compared with a net gain last year of S$478 million.
SARS began affecting passenger demand at SIA and other major Asian carriers in the second half of March, and as the virus spread in April and May bookings dived.
The SIA Group's revenue fell 35% during the three-month period, when 49% fewer passengers were carried year-on-year and passenger load factor fell to 57.4% from 75.5%. Passenger break-even load factor soared to 88.1% from 73.3%.
The airline cut capacity by around 30% at the height of the SARS outbreak, laid off around 600 employees, slashed wages and forced staff to take unpaid leave. SIA says annual savings from these measures are estimated at S$176 million.
While many hard-hit Asian carriers are now reporting a rapid pick-up in demand and are steadily restoring suspended services following the containment of SARS in all areas, yields remain weak. SIA says that "while it appears the worst is over, the outlook for the next quarter and the rest of the year is still uncertain".
Most analysts are still forecasting full-year profits, however.
Source: Flight International
