Singapore Airlines, the world's second-biggest airline by stock market value, more than doubled its quarterly profit, its first increase in six quarters, helped by a one-off gain from the sale of property.
But the state-controlled company renewed its warning that rising fuel costs - up 37 percent in the quarter - would continue to weigh on its profit and that it expected the price of jet fuel to remain high. It said that the outlook for air travel was broadly positive for the rest of its financial year to the end of March 2007 due to favourable economic conditions in Asia Pacific and Europe.
Singapore Air's first-quarter profit rose to S$575 million ($364 million) from S$235 million a year ago thanks to an expected S$223 million gain from the sale of its SIA Building in Singapore's business district. Excluding that gain and a S$109.9 million gain from the sale of aircraft and spare parts, quarterly profit was S$242 million.
Five analysts polled by Reuters had on average forecast profit of around S$277 million, excluding proceeds from the sale of planes and property. Analysts said once again it was Singapore Air's ability to protect its business from soaring fuel costs by hedging in the futures market that helped it to turn in a decent result.
It spent S$1.22 billion, more than double its profit in the quarter, on jet fuel compared to S$892 million a year ago.
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