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SIAEC reports S$10.7m net profit for Q1; government support lessens bleed from Covid-19
SIA Engineering Company (SIAEC), the maintenance arm of Singapore Airlines, recorded a net profit slide of 74.3 per cent to S$10.7 million between April and June 2020, compared with the same quarter a year ago.
The mainboard-listed company said in its financial statement released on Friday that it would have recorded a loss of S$36.7 million, if not for government support schemes, notably the Jobs Support Scheme (JSS), that have cushioned the impact of the pandemic on its financial performance for the first quarter of financial year 2020/21.
The JSS provides a 75 per cent wage support for aerospace maintenance, repair and operations (MRO) operators.
SIAEC's basic earnings per share for Q1 was 0.96 Singapore cent, down from 4.66 cents in the previous quarter.
It said the impact of Covid-19 was severely felt in Q1, when flight frequencies handled by the group hit a historic low.
At its Singapore base, the number of flights handled in the quarter was only about 13 per cent of what it used to handle pre-pandemic, it said.
It added that it has taken steps to safeguard the long-term sustainability of the group’s businesses during and post-Covid-19. During Singapore's "circuit breaker" period in April and May, the group’s businesses in Singapore continued to operate as an essential service provider in support of its airline customers.
Measures taken in previous months have continued, including management pay cuts, a 25 per cent reduction in the fees of the board of directors, voluntary and compulsory no-pay leave, and furlough for staff on re-employment contracts, it said.
"While flight activities started to pick up in June, the increase was not material. With no clear signs of stronger pickup in flight frequencies, the outlook for our MRO business will be challenging," SIAEC said.
Even so, it said it will continue its transformation efforts and focus on the use of digital technology to improve its processes and capability.
SIAEC's share prices inched up S$0.02 or 1 per cent to close at S$1.96 on Friday.