Singapore Airline runs into turbulence as shares slump on surprise loss

Rebecca Smith
Singapore Airlines said it was facing
Singapore Airlines said it was facing "intense competition" (Source: Getty)

Singapore Airlines has been facing its fair share of turbulence after shares dived off the back of the carrier's surprise loss.

Investors sold off shares in the airline after it posted a surprise loss, with stock dropping more than six per cent.

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The carrier cited "intense competition" amid increasing cost pressures, as well as a fine related to anti-competitive behaviour in its cargo division.

Group revenues in the three months to March 31 were pretty flat at S$3.72bn (£2.05bn), it said after close of market yesterday. But Singapore Air group, which owns Singapore Air, as well as a regional airline and two budget carriers, posted a net loss of S$138.3m for the three months ended March, when analysts had been expecting a profit of S$54.3m.

It reported a S$132m hit to net profit relating to a European competition ruling against its cargo unit, which had been previously announced.

The airline has also announced today that its SIA Cargo subsidiary will be reintegrated into the main airline.

Analysts said it had filled more seats at the expense of yields because of significant price competition in the region.

Singapore Airlines said in its outlook that "intense competition arising from excess capacity in major markets, alongside geopolitical and economic uncertainty, continue to exert pressure on yields".

The carrier has said it will now conduct a strategic review of its portfolio.

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