SIA Engineering net profit more than doubles to $27m in Q1 FY23-24

It posted its first quarter of operating profit since the pandemic.

SIA Engineering’s net profit more than doubled to $27m in the first quarter of the financial year 2023 to 2024 ending on 30 June as it saw higher demand for maintenance, repair, and operations (MRO).

In a disclosure, SIA Engineering said its revenue rose 52.7% YoY to $261.9m driven by the demand for MRO as flight activities rose.
Its expenditure also rose by 49% to $261.5m due to higher manpower costs and the absence of government wage support.

Due to this, the company posted its first quarter of operating profit since the start of the pandemic at $0.4m, increasing $4.4m YoY. Excluding the impedance to wage support posted in the same quarter last year, operating performance would reach $13m.

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The number of flights handled by the company’s line maintenance unit in Singapore recovered to 84% of pre-pandemic volume, increasing 69% YoY, and 11% quarter-on-quarter.

“The outlook for global air travel demand continues to be strong. While this bodes well for demand for MRO services, further recovery in MRO demand will be at a slower pace than the rate of recovery over the past year as airlines manage various constraints to return fully to pre-pandemic flight levels,” it said.

“In addition, ongoing geopolitical tensions and macroeconomic uncertainties, inflationary pressure and supply chain disruptions present challenges to business recovery and operating margins. We therefore continue to be vigilant in managing cost, as well as to drive improvements in productivity and efficiency through our Continuous Improvement programme,” SIA Engineering added.

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