Time will tell if SIA can graduate, potentially in 2014 or 2015, to a new phase of growth and higher profitability. But after reporting yet another drop in quarterly profits, it is clear change at SIA is needed and the strategic adjustments that have now been implemented by CEO Goh Choon Phong are a step in the right direction.
After reporting a rare loss in its fiscal quarter ending 31-Mar-2012, the SIA Group has been back in the black the last two quarters. But profits for the Group’s fiscal first half ending 30-Sep-2012, 1HFY2012/13, were very modest and represented a further decline from the prior year’s subpar performance.
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The SIA Group turned a net profit of SGD168 million (USD137 million) in 1HFY2012/13, a 30% drop compared to the SGD239 million (USD195 million) profit in 1HFY2011/12 and a 73% drop compared to the SGD633 million net profit (USD518 million) in 1HFY2010/11.
The Group’s operating profit for the six months came in at SGD142 million (USD116 million), which included profits at SIA mainline, regional subsidiary SilkAir and maintenance unit SIA Engineering. This represented a slight improvement over the SGD134 million (USD110 million) operating profit from 1HFY2011/12 but a 76% drop compared to the SGD596 million (USD487 million) operating profit from 1HFY2010/11.