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Singapore Airlines and its subsidiaries – Tigerair, Silkair and Scoot – Changue, Singapore.
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Singapore Airlines stocks after carrier reported a reduction by 59% In profit for the first quarter of its financial year.
Showing data from LSEG decreased by more than 8% and entered the highest decrease within the day. Currently traded by 7.11% below.
Net income decreased to $ 186 million in Singapore ($ 144 million) per quarter, ended on June 30, the company’s profits said. The drop was due to a decrease in interest revenues and losses from their associates.
Its profits in the first quarter also decreased by 13.8% to $ 405 million a year.
Singapore airlines fall 8% upon the profits in the first quarter
“In addition to lower profits, the decline in net income is largely explained by less income from interest on the back balance of funds and a reduction in interest rate, and the group that recorded a share of losing companies compared to the share of the same quarter of the last year,” SIA said in a statement of profits.
Air India Drag
The flagship carrier Singapore also noted that the loss is related to the financial company Air India, which were not included in the results of the group for the same quarter in 2024.
Singapore Airlines started considering the action for Air India since December 2024 after Vistara was completely united in the airline. Now SIA has 25.1% stock in Air India.
“Air India’s losses were much deeper than expected, and it is unlikely to alleviate in the near future when the airline moves on a difficult restructuring along with reputational damage,” said CNBC Tabitha Foo, DBS research analyst.
“Following (Boeing) Dreamliner incident in JuneAir India reportedly noticed a 20% drop in domestic and international routes, “she said, adding that the average tariffs decreased by 8% to 15%, and the cancellations increased, especially among corporate and premium travels.
FOO noted that most of the cost -related 171 Air India costs should be covered with insurance.
However, “Air India is still likely to remain almost promising in the bottom line,” she said.
Demand remains strong
However, Sia noted that the demand for air travel and cargo remained strong, despite geopolitical uncertainty.
“Demand for air travel remains healthy in the second quarter FY2025/26 in most routes from the traditional summer peak,” the company said. However, the world airline continues to fight the “flying” working situation, including geopolitical developments.
Sia noted that while tariffs arising from the US trade war have led to unpredictable and uncertain demand for their freight business, its “diversified network and vertical reduce its impact in specific regions and market segments.”
“The SIA group is well located to maintain the leading industry, thanks to its reliable basics, digital capabilities and talented and devoted labor,” Singapore added.
However, Maybank led a weaker demand for SIA cargo and higher operating costs as reasons for reducing profits for carrier by 25-29% over the next three years.
“We believe that the stock price ahead of its basics and lowering SIA for sale,” said Maybank investment analyst Eric Ong, who added that stocks are still “too expensive” about the actual efficiency of the firm.
Maybank’s fresh target price is $ 6.75 per share, compared to the current price of $ 7.08.
