SINGAPORE Airlines (SIA) Cargo widened its fiscal first quarter profit loss nearly fourfold to S$34 million (US$25.1 million), as cargo revenues declined S$60 million (SIA does not reveal cargo revenues).
SIA blamed the decline on poor yields of 17.4 per cent and said they came despite a S$35 million reduction in operating costs - thanks to lower fuel costs - and a 6.4 per cent increase in demand to 1.7 billion freight tonne kilometre.
Going forward, SIA said: "The cargo market remains soft, with economic uncertainty in Europe and China. Cargo yields are expected to remain under pressure as overcapacity persists in the industry."
Cargo capacity at the airline was also up on a year earlier during the quarter, but SIA Cargo still managed to improve its load factor to 62 per cent from 61.1 per cent a year earlier.
SIA Cargo operates nine Boeing 747-400 freighters as of June 30, compared with eight at the same point last year. With today's yields down, the breakeven load factor is 68.7 per cent against 63.9 per cent last year.
Source : HKSG.