SINGAPORE Airlines' (SIA) net loss in Q2 doubled that of Q1 as it reported a record net loss of S$3.47 billion for the six months to September.

 

The Q2 losses came on the back of an impairment charge for older aircraft as well as the S$42 million retrenchment cost.

 

The national carrier reported a loss of S$1.1 billion for the first quarter to June. With H1 loss coming in at S$3.47 billion, it means that it bled S$2.3 billion - twice the loss in Q1 - in the second quarter.

 

The H1 net loss was a reversal from a S$206 million profit for April to September last year, before it was blindsided by the novel coronavirus pandemic.

 

Revenue was 80.4 per cent down at S$1.63 billion for the first half of FY 2021, compared to S$8.3 billion in the preceding year.

 

The hit from the pandemic has not only resulted in steep decline in revenue, but has also led the group to book an impairment of S$1.33 billion on the carrying values of older generation aircraft, said the carrier in a media statement released on Friday after trading hours.

 

Besides the impairment on aircraft, SIA has also fully written down the goodwill of S$170 million that was recorded when it took control of Tiger Airways in October 2014.

 

Furthermore, the retrenchment exercise which cut 2,000 jobs cost the group S$42 million, SIA disclosed for the first time since its announcement on the axe falling.

 

It has skipped an interim dividend " in view of the significant loss incurred and the need to conserve cash" .

 

SIA said industry airfreight capacity is anticipated to remain constrained because of lower bellyhold capacity arising from fewer passenger flights. This is expected to keep cargo yields and load factors " high" in the coming months.

 

It expects to see a progressive recovery in general cargo demand, and continued strong demand from pharmaceuticals and perishables. Cargo demand is also expected to get a boost from the big e-commerce sale days and new product launches, SIA said.

 

Hence, it will continue to grow the group' s capacity to meet demand and expand the cargo network by deploying passenger aircraft on dedicated cargo operations.