Singapore Air's Q3 Operating Profit Nearly Doubles

Singapore Airlines reported a near doubling of its third-quarter operating profit, helped by lower fuel costs, but said intense competition in Southeast Asia will put pressure on its performance.

The airline reported an operating profit of SGD$288 million (USD$205 million), up 96 percent from a year ago, while net profit rose 35.5 percent to SGD$275 million.

The carrier, a benchmark for Asia's full-service airline industry, said it expects the challenging operating environment to persist.

"On the competitive front, expansion of other full-service airlines as well as low-cost carriers, particularly in Southeast Asia, will continue to exert pressure on loads and yields," it said in a statement.

SIA's business model hinges on using its hub at Singapore's Changi Airport to connect passengers within Asia and to Europe, Australia and the United States. It also has a presence in the low-cost segment through Tiger Airways and Scoot.

"While more relief could arise from lower fuel prices, which have declined to a 12-year low, fuel continues to make up a significant portion of the Group's expenditure, with 46.6 percent of the Group's fuel requirement in the fourth quarter hedged at a weighted average price of USD$90 per barrel," SIA said.