SIA Engineering recorded a net profit of $12.8 million down 61.4% from S$33.2 million in the same period last year as the Group continued its recovery with increased flight activities. Excluding last year’s wage support and one- time write-back of tax provision, Group performance improved $19.8 million year-on-year.
The lower net profit came amid higher group expenditure, mainly due to the absence of wage support. On its business update on the Singapore Exchange, SIAEC reported that that this was the first quarter since the pandemic with no wage support.
The Group recorded revenue of $208.1 million for the third quarter of FY2022-23, an increase of 48.6% year-on-year. Group expenditure rose at a higher rate of 49.3% to $220.6 million mainly due to absence of wage support; this is the first quarter with no wage support since the pandemic. Excluding impact of wage support, expenditure increase was 35.5%, contributed mainly by increase in manpower costs. Manpower costs increased largely due to increase in headcount, cessation of manpower cost mitigation measures and increments.
As revenue growth was lower than the rise in expenditure, the Group incurred a higher operating loss of $12.5 million as compared to the operating loss of $7.8 million in the same period last year. Excluding impact of wage support, operating performance improved $10.3 million.
Share of profits of associated and joint venture companies was $19.3 million, $20.8 million lower year-on-year. In the same period last year, certain group companies recorded one-time writeback of tax provision. Excluding the impact of this exceptional item, share of profit was $0.7 million higher year-on-year. The airframe and line maintenance segment recorded an improvement of $5.9 million while the engine and component segment registered $5.2 million lower profits.
As at 31 December 2022, equity attributable to owners of the parent was $1,652.7 million, an increase of $42.0 million from 31 March 2022, mainly due to profits earned.
Total assets at $1,890.0 million as of 31 December 2022 increased $51.8 million from 31 March 2022. The Group’s cash balance was $576.8 million with no borrowings.
The number of flights handled in the quarter by line maintenance unit in Singapore was 71% of pre- pandemic volume. Going ahead, the Group anticipates that the reopening of China’s borders is a positive development for a faster and full recovery of the aviation industry. However, challenges remain in the recovery path with risk of global recession, inflationary pressures, supply-chain disruptions and geopolitical uncertainties.