SATS' profits fell 13.9% to $59.3m in Q3

The group’s expenditure soared amidst consolidations of its subsidiaries.

SATS' profit attributable to its owners dropped 13.9% YoY to $59.3m in Q3 FY19-20, the company announced. Revenue rose 17.6% to $545.6m over the same period.

For the first nine months of the year, the attributable profit fell 12% YoY to $174.7m, whilst revenue grew 11.2% to $1.51b.

Food Solutions’ revenue leapt 23.1% to $310.8m during the quarter, primarily due to the consolidation of Country Foods (CFPL) and Nanjing Weizhou Airline Food Corp. (NWA), which contributed $42.3m and $14.9m respectively.

In addition, Gateway Services’ revenue grew 10.9% to $234.3m, which was mainly attributed to a $23.5m registered from the consolidation of Ground Team Red Holdings and Ground Team Red, outpacing lower cargo volume and ship calls.

However, the group’s expenditure soared 21.1% YoY to $482.7m, with the consolidation of its new subsidiaries accounting for $76.8m. This was offset by the divestment of Food and Allied Support Services Corporate (FASSCO) for $5m.

Staff costs also expanded by $23.4m, corresponding with volume growth and the consolidation of newly-added subsidiaries. Raw materials costs rose largely due to the consolidation of CFPL and NWA, whilst higher license fees were in line with increased revenue.

Excluding the consolidation of newly-acquired subsidiaries and divestment of FASSCO, the group’s expenditure would have just climbed 3.1%.

Operating profit for the quarter dipped 3.7% to $62.9m. Taking into account the increase in interest expense from the adoption of SFRS(I) 16, the negative impact on the group’s profit after tax and non-controlling interests from the new accounting standard was $1.5m for the quarter.