SATS' overseas ventures a key driver for long-term growth

WITH the aviation industry facing headwinds, airlines aren't the only ones feeling the impact. Ground-handler SATS Ltd may well find growth moderating in the near-term too.

In its recent financial results update for the year ended March 31, 2017 (FY17), SATS' management warned that its margins may come under pressure as airlines struggle with deteriorating yields stemming from a competitive operating environment and uncertainties in trade flows. Other factors flagged that might affect its performance include the absence of one-off items, the reduction in government subsidies and franchise fee rebates as well as higher operational costs.

As a result, the ground-handler and catering group is planning to channel additional investments towards adjacent businesses and new geographies in the current fiscal year. Travel aside, the demand for e-commerce and high quality, safe food remains high in Asia, it highlighted.