Singapore Airlines to pay staff over 7 months’ bonus, warns of Trump’s tariffs hurting demand
The carrier’s cautious outlook emerged despite full-year profit beating estimates
Singapore Airlines Ltd. will reward employees with a profit-sharing bonus worth more than seven months after delivering full-year net income of S$2.78 billion (US$2.1 billion) that beat analyst estimates.
Employees will be paid 7.45 months’ bonus, lower than the 7.94 months received a year ago, The Straits Times reported on Thursday, citing a response from the airline.
The smaller bonus payout comes as Singapore Airlines on Thursday warned that tariff and trade tensions on top of broader economic and geopolitical uncertainties could hurt demand for passenger and cargo flights.
“The global airline industry faces a challenging operating environment,” the airline said in a statement. The growing challenges “may impact consumer and business confidence, potentially affecting both passenger and cargo markets”, adding it remained vigilant to adapt to changing market conditions.
The company’s net income rose 3.9 per cent to S$2.78 billion (US$2.1 billion) in the year ended March 31, higher than analyst estimates for S$2.4 billion. Revenue edged 2.8 per cent higher to a record S$19.5 billion, topping expectations for S$19.3 billion.
Singapore Airlines’ muted final quarter underscores the uncertainty hanging over the carrier for the year ahead. While the airline had been confident about robust travel demand, US President Donald Trump’s ever-changing policies have hurt consumer sentiment and upended global trade flows.
The airline’s passenger yield – a major metric of profitability – declined slower than in the previous three years, falling 5.5 per cent to 10.3 Singaporean cents per kilometre. Expenses, including fuel costs, rose.
Singapore Airlines’ caution stopped short of any concrete financial impact. That contrasts with major US airlines like American Airlines Group Inc. and Delta Air Lines Inc., which withdrew their full-year guidance, while United Airlines Holdings Inc. took the unusual step of offering two forecasts factoring in a scenario with and without a tariff impact. Europe’s largest carrier, Deutsche Lufthansa, had warned last month it had limited earnings visibility amid the trade tensions.
Singapore Airlines Group, which includes budget unit Scoot, carried a record 39.4 million passengers in the financial period. The carrier also has a 25.1 per cent stake in Tata Group-run Air India. The city state’s flag carrier has entered deals to jointly operate flights and coordinate schedules and airfares on routes between Singapore and the likes of Indonesia, Japan, Germany and Malaysia with rival carriers to shore up its competitive defences.
Net income was boosted by a one-off non-cash gain of S$1.1 billion booked in the third quarter. Stripping out the one-off item, adjusted net income fell 37 per cent to S$1.7 billion.
