SATS Q2 net profit falls 7.6%

Singapore

AIRPORT and food services provider SATS on Tuesday announced that net profit for the second quarter ended Sept 30 fell 7.6 per cent on lower cargo volumes and investments in growth initiatives.

Net profit was S$60.7 million compared with S$65.7 million a year ago, while revenue improved 9.8 per cent to S$497.4 million. Earnings per share was 5.4 Singapore cents, down from 5.9 cents in the second quarter of the previous financial year.

Group expenditure rose 11.7 per cent to S$432.4 million due to the consolidation of subsidiaries Ground Team Red Holdings and Ground Team Red (the GTR entities) and Country Foods. This was offset by the divestment of Food and Allied Support Services Corporate in August.

For the half-year ended Sept 30, net profit fell 11 per cent to S$115.4 million from S$129.6 million year-on-year. Revenue grew 7.8 per cent to S$962.5 million.

Earnings per share was 10.3 Singapore cents compared with 11.6 cents a year ago.

SATS has declared an interim cash dividend of six cents per share, which was the same amount declared in the corresponding period of the previous year. The dividend is payable on Dec 11.

While the slowdown in trade and economic growth is resulting in weaker cargo volume in key markets, SATS continues to invest in growth opportunities and infrastructure for the longer term, such as new kitchens, supply chain capabilities, digital control centres for ground handling and new cargo handling facilities, it said.

Shares of SATS closed flat at S$5.09 before the results were announced.