SIA Engineering signs S$120.8 million services agreement with Scoot

SIA Engineering Company (SIAEC) has inked a S$120.8 million agreement with Scoot, to provide the budget carrier with maintenance, repair and overhaul and fleet management support services.

The agreement will commence on Apr 1. It has a term of two years, with the option for an extension of one additional year, SIAEC said in a bourse filing on Friday (Mar 31). If extended, the agreement is expected to yield a labour revenue of S$120.8 million over the three-year term.

On Wednesday, SIAEC announced a fresh services agreement with national carrier Singapore Airlines (SIA). This agreement supersedes an earlier agreement that the two parties entered into in April 2019.

Like the Scoot agreement, SIAEC’s agreement with SIA will start on Apr 1 with a term of two years and an option to extend for a further one-year period. Over the three-year period, it is expected to yield labour revenue of S$1.14 billion.

Both the Scoot and SIA deals are not expected to have any material impact on SIAEC’s earnings per share for the financial year ending Mar 31, 2024.

Shares of SIAEC ended Friday at S$2.25, down S$0.03 or 1.3 per cent.