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Sats reports Q2 loss of S$33.2m, with staff cost down 61.3%

GROUND-HANDLER and in-flight caterer Sats has managed to narrow its quarterly loss, slashing expenditure by almost half on the back of a 61 per cent drop in staff cost.

It reported a net loss of S$33.2 million for the three months to September in an exchange filing on Thursday after market close. While this is 154.7 per cent lower year on year, Sats managed to shrink the red ink from S$43.7 million in the preceding quarter.

The smaller quarterly loss was achieved as Sats continued to slash its costs by 46.6 per cent or S$201.3 million year on year. A 61.3 per cent fall in staff cost (as a result of government reliefs, lower contract services and a drop in headcount by 500) helped contribute to the decrease in cost.

Revenue was 53.5 per cent lower at S$231.1 million for the second quarter of FY2021.

Loss per share stood at three Singapore cents, compared to earnings per share of 5.4 Singapore cents for the year-ago period. Net asset value per share dropped from S$1.45 as at end-March to S$1.38 as at end-September.

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In light of the significant uncertainties in the operating environment, Sats will not pay an interim dividend. The interim dividend a year ago was six Singapore cents.

Alex Hungate, chief executive of Sats, said the outlook remains challenging with flight and passenger volumes still heavily constrained by pandemic-related travel restrictions, although demand for air cargo continues to be more resilient.

While flight, passenger and cargo volumes have all climbed from their lows in April, the trajectory of the recovery remains uncertain with Covid-19 resurgent in some countries, he added.

Shares in Sats ended at S$3.60 or seven cents higher on Thursday, before the financial results were released.

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