SATS profits jump 25.2% to $53.7m in 3Q15

Amid managed costs and a favourable business mix.

SATS’ Japan subsidiary, TFK, registered lower revenue, but Gateway Services saved the day.

According to a report by OCBC, SATS reported a good set of 3QFY15 results on the back of disciplined cost management and favourable business mix which pushed up overall operating margins.

While revenue declined 3.2% YoY to S$450.7m, PATMI saw a 25.2% jump to S$53.7m. The lower revenue is largely attributable to the weaker result from its Japan subsidiary, TFK, resulting in a 7.2% YoY drop in its 3QFY15 Food Solutions (FS) segment revenue.

Gateway Services (GS) 3QFY15 revenue, however, saw a 3.5% increase as SATS continue to gain market share in cargo handling business in Singapore. The shift in business mix away from FS segment resulted in a 13.1% drop in 3QFY15 raw materials expenses. Lower staff costs also helped improve profitability. SATS 9MFY15 PATMI came in above expectations with a 4.6% YoY increase, as it formed 79.6% and 78.4% of the street and OCBC’s FY15 forecasts.

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