Singapore Air Q3 Profit Falls On Hedging Losses

February 10, 2009

Singapore Airlines posted a 43 percent fall in third-quarter net profit, dragged down by slowing demand for travel and cargo as well as fuel hedging losses.

Singapore Air, the world's largest airline by market value, said October-December net profit dropped to SGD$337.2 million (USD$225 million) from SGD$590 million a year ago.

Singapore Air has seen declining passenger demand this year as the global slowdown crimps corporate and leisure travel, forcing it to reduce flights from the city-state to other Asian cities.

The airline said it suffered hedging losses of SGD$341 million due to the sharp drop in fuel prices during the quarter.

SIA shares fell by more than a fifth in October-December, while the benchmark Straits Times index lost 25 percent.

Shares in regional rival Cathay Pacific fell 33 percent and Qantas lost 16 percent.