Singapore Airlines (SIA) on Thursday reported a net loss of 212 million Singapore dollars (USD 149.30 million), the national carrier's first annual net loss in its 48-year history, after the coronavirus pandemic crippled air travel globally.
In a filing to the Singapore Exchange, the SIA Group reported a net loss of 212 million Singapore dollars (USD 149.30 million) for the 12 months ending March 31, a reversal from the 683 million Singapore dollar (USD 480.99 million) profit in the previous year.
Net loss for January to March alone was 732 million Singapore dollars (USD 515.50 million), compared with 203 million Singapore dollars (USD 136.24 million) net profit in the same period last year, as reported by Channel News Asia.
Operating profit for the year was down 94.5 per cent at 59 million Singapore dollars (USD 41.55 million), from 1 billion Singapore dollars (USD 704.23 million) the previous year.
SIA, a Tata group partner in the Vistara joint venture airline, said that it had entered the fourth quarter on the back of a strong performance in its first nine months, after robust passenger traffic and extensive initiatives undertaken as part of its transformation programme.
Then COVID-19 hit, and fears about the spread of the virus brought global travel to a standstill.
The steep drop in passenger traffic in the fourth quarter resulted in 894 million Singapore dollar (USD 629.58 million) plunge in revenue, 22 per cent down from the same period last year.
SIA flagged on May 8 that it would report a material operating loss in the quarter ended March 31, partly because of a collapse in fuel prices that led to major hedging losses.
The airline said last week that operating cash flows were expected to remain negative in the quarter ending on June 30 at a time when most of its fleet is grounded because of the coronavirus outbreak. Additional fuel hedging losses are expected in that quarter, it said.
The ongoing COVID-19 pandemic has hit the aviation sector hard after countries tightened borders and enforced lockdowns to prevent the spread of the coronavirus.
The International Air Transport Association (IATA) has warned that the outbreak could cost passenger airlines up to USD 113 billion in lost revenue this year.
SIA and regional arm SilkAir have cut 96 per cent of its capacity to the end of June, while its budget arm Scoot has cut 98 per cent.
The group is also in negotiations with aircraft manufacturers to adjust its delivery stream for existing aircraft orders and are talking with various suppliers to reschedule payments.
In March, SIA group's carriers posted a 60.4 per cent decline in passenger carriage.
With the aviation industry under severe turbulence, SIA announced a slew of cost-cutting measures in March, including wage cuts for its management team and compulsory no-pay leave for employees. The government said that it will spare no effort to help the national carrier see through this crisis.
SIA has supported Singapore in its fight against COVID-19, including helping to fly in essential supplies and mounting evacuation flights to bring Singaporeans home.
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