SIA cargo profits narrow core net loss: CGS CIMB

It narrowed net loss by 44% year-on-year in the second half of 2022.

Singapore Airlines (SIA) narrowed its core net loss by 44% to $268m in the second half (H2) of 2022 year-on-year on the back of stronger cargo profits and a lower share of associate losses, capital market firm CGS CIMB said.

Within H2 2022, SIA enjoyed a small core net profit of $28m in the third quarter of 2022 but it reversed into a core net loss of $296m in the fourth quarter of 2022.

The third-quarter core net profit was achieved due to extremely strong cargo profits which benefited from the seasonal December peak but cargo profits weakened quarter-on-quarter into the fourth quarter amidst the Chinese New Year holiday in February and the strict lockdowns in China from March.

Whilst demand for air travel from April to June 2022 looks good because of the reopening of borders, CGS CIMB sees cost escalation to dampen the upside brought about by the oil price increase as geopolitical tensions arise.