e-Travel Blackboard
7 May 2008
The fatal combination of rising fuel prices and slowing business travel could place pressure the performance of Singapore Airlines, potentially resulting in the lowest profit for 18 months.
The International Air Transport Association has reduced the profit forecast of 2008 for the world’s second-largest carrier, for the second time in the past four months.
The prediction of the IATA mirrors the pressing economic situation and its impact upon the airline industry.
“Jet costs have been going up too fast, so I expect it’ll hit SIA in Q4,” said Morgan Stanley analyst Chin Lim.
“They will be able to hedge some of it but earnings are still going to be down.”
Reuters polled 11 analysts to discover that SIA is expected to post a 46 percent drop between January and March, to USD$268 million.
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