SATS Q3FY2024 net income up 42%

SATS net income for the third quarter ended December 31, 2024 increased 42 percent to S$31.5 million ($23.3 million) quarter-on-quarter (QoQ) on 6.5 percent increase in revenue to S$1.4 billion ($1 billion), primarily due to volume improvements boosted by strong seasonal demand, particularly in cargo for WFS.

Food solutions revenue increased seven percent QoQ to S$294.5 million while Gateway services revenue was up six percent to S$1.1 billion, says an official release.

"As at December 2023 (excluding WFS), aviation food and flight volumes reached 97 percent and 86 percent respectively while cargo volume recovered to 99 percent of pre-Covid levels in Q3FY24, primarily due to increased travel demand and seasonality factor. Group expenditure increased 5.2 percent QoQ to S$1.3 billion as business volume growth and productivity measures began to positively impact results."

Kerry Mok, President and Chief Executive Officer, SATS says: “During the quarter, our business operations continued to show improvement in profitability, driven by travel recovery and strong seasonal demand. The group continues to benefit from operational synergies and new commercial wins from the expanded network and our strengthened global position. Singapore remains a key pillar of our business. We are committed to support the continued growth of Changi Airport and have ramped up our operations accordingly. Our refinancing efforts are also bearing fruit with significant financial savings realised to date. We continue to be focused on driving profitable growth and increasing shareholder value.”

Group revenue for the first nine months (financial year of April 2023-March 2024) tripled to S$3.8 billion ($2.8 billion) over the same period last year, driven primarily by the consolidation of Worldwide Flight Services (WFS) after its acquisition by SATS on April 3, 2023.

"WFS’ revenue in the first nine months was S$2.2 billion. Excluding WFS, SATS’ standalone revenue increased 28 percent to S$1.6 billion, bolstered by the recovery in the aviation sector. In nine months of FY2024, SATS Food Solutions and Gateway Services' revenue increased by 28 percent each to S$810.6 million and S$824.7 million, respectively.

For the first nine months of FY2024, net income for the group was S$23.7 million, reflecting an improvement of S$55.7 million from a loss of S$32 million recorded in the same period last year.

2024 outlook
"SATS is well-positioned to benefit from the ongoing recovery in both passenger and cargo in 2024. As the group focuses on profitability, the priorities remain on repaying debt, reinvesting in the business and resuming dividend distribution to our shareholders."