SINGAPORE. Singapore Airlines has posted an unprecedented quarterly loss following the SARS epidemic’s knockout blow to passenger traffic.
The world’s second-largest passenger airline by market reported a net loss of S$312 million (US$177.5 million) for the quarter ended June 30 against a net profit of S$478.4 million (US$271.7 million) in the same period a year ago. Overall revenue fell -34.9% to S$1.65 billion (US$0.94 billion).
“While it appears the worst is over, the outlook for the next quarter and the rest of the year is still uncertain,” Singapore Airlines said in a statement.
The SARS outbreak forced airlines to ground planes and slash costs. This, combined with the Iraq war, prompted a -45.7% slide in passenger traffic during the first quarter.
“The capacity plan for the second quarter is -12.2% lower than the level for July to September 2002, but is +28% higher than that in the April to June 2003 period,” the company said in its statement.
“The success of marketing promotions to rebuild traffic would be at the expense of yields as sizeable fare discounts have to be offered, and business travel is still relatively weak given current global economic conditions.”
ING Financial Markets analyst Philip Wickham told Reuters that the results were in line with expectations, but that passenger traffic figures for July should be a marked improvement on June.
