SIA Cargo’s reintegration pays off as cargo revenues surge in first half

SIA Cargo’s reintegration into parent company Singapore Airlines seems to have reversed the steep losses at the Singaporean cargo carrier. Just-posted half-year operating profits of US$23 million represent a $56.5 million, year-over-year, increase.

Total cargo revenues for the first half of FY 2017-18 were also up $90 million on higher freight carriage (up by 6.1 percent) and yield (up by 6.7 percent). The carrier’s cargo load factor rose by 3.2 percentage points to 64.8 percent over the same time period.

These numbers are a sharp contrast to fiscal year 2016-17 cargo revenues, which declined $46 million, y-o-y, on the back of cargo yield erosion, notwithstanding higher freight carriage.

It’s worth noting that, industry-wide, yields have progressively increased since March 2017, with last month’s gains of 12.1 percent virtually ensuring that any competent cargo department will be posting strong results in the months ahead.

SIA Cargo says that it will, “continue to pursue charter opportunities and deploy capacity to match demand.”

Over the second quarter, SIA Cargo reported an operating profit of $20 million. Revenue grew $47 million as freight carriage grew 5.4 percent, further lifted by a 9.1 percent improvement in cargo yield that the carrier accredited to “improved trade conditions.”

SIA Cargo operated a fleet of seven 747-400 freighters as of Sept. 30, and its freighter network covered 19 cities in 13 countries, including Singapore.