Scoot looks to raise top line to tackle cost pressures

GIVEN the limits to the ways costs can be cut, Scoot – the budget arm of Singapore Airlines (SIA) – will strive to raise revenue from seats sold and from add-on offerings to soften the impact of rising costs on its profit margins, its chief executive officer Leslie Thng said on Thursday (Mar 7).

In a recent quarterly update, SIA group posted a 19.3 per cent decline in operating profit for the third quarter of FY2024. This was attributed to a 9.5 per cent increase in non-fuel expenditure, and a 9.1 per cent rise in net fuel cost.

Scoot’s operating profit for the quarter amounted to S$39.8 million, a 70.5 per cent drop from that in Q3 FY2023. Passenger yield dipped 15.3 per cent as its competitors added capacity; unit cost rose by 3.2 per cent in an inflationary environment.