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SINGAPORE Airlines, the world's second-biggest airline by market value, posted on Tuesday a 21 per cent fall in quarterly profit, beating expectations, as soaring jet fuel costs and the absence of a one-off tax gain weighed.
SIA, which at $13.4 billion ranks behind Air China, said January-March net profit was S$527.5 million compared with S$671 million a year ago. It beat an average forecast of S$364 million from 11 analysts polled by Reuters.
The year ago period was boosted by a gain of S$247 million due to a tax write-back that followed a cut in Singapore's corporate tax rate.
Operating profit for Singapore Air, 55-per cent owned by state investment firm Temasek, was S$468.1 million, compared with S$333.5 million a year ago.
Benchmark Asian jet fuel prices hit a new record over $159 per barrel on Tuesday and are up about 44 per cent since the start of the year, reflecting the rise in global oil prices.
Analysts say SIA, which relies on premium and business travellers for about half its revenues, could be hurt by a drop in business travel due to the ongoing US credit crisis.
The carrier has reported four consecutive months of lower passenger traffic from North America since December due to slowing demand.
Singapore Air shares fell 10 pe rcent in the first three months of 2008, slightly outperforming the benchmark Straits Times index's 13 per cent fall and regional rivals Qantas, which fell 28 per cent, and Cathay Pacific, which lost 25 per cent. -- REUTERS
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