SATS Ltd. (SATS) has swung back to profitability for the full year ended March 31, 2024, buoyed by improved cargo performance and travel recovery.
The Singaporean airport service company that handles the main ground handling and in-flight catering service provider at Changi Airport said its PATMI was S$56.4 million (US$41.9 million) for the full year on the back of record-high revenue of S$5.1 billion (US$3.8 billion) for the period.
SATS noted the rebound in aviation from the pandemic and its consolidation with WFS as part of a Group-wide transformation into a global player.
"SATS has been delivering steady improvements in financial performance over the quarters since its integration with WFS, the world's largest air cargo handling firm, in April 2023. The integration with WFS is on track, with the Group's expanded network, global connectivity and consolidation with WFS contributing to its return to profitability," it said in an announcement.
The group's revenue for the period was up 192.9% year-on-year to a record S$5.1 billion, driven primarily by the consolidation of WFS, improvements in air cargo volumes, and the continuing travel recovery.
For the year, Gateway Services revenue grew 354.8% to S$4.0 billion, while Food Solutions revenue grew 27.4% to S$1.1 billion.
The PATMI for FY24 represented an S$82.9 million improvement from the S$26.5 million loss recorded in FY23.
SATS noted that its transformation into a global player with an expanded route network and global presence makes the Group well-positioned to capitalise on strong tailwinds and positive growth momentum in air cargo and passenger traffic, which will drive sustainable long-term value-added growth in the aviation sector.
Global air passenger traffic is projected to recover fully to 2019 levels by the end of 2024, while global air cargo traffic is forecasted to grow by 4.5% in 2024.
SATS said it would benefit from these trends and be further bolstered by a robust e-commerce sector and the growing demand for specialised services, which give better yields from air cargo services.
Looking ahead, SATS noted that its financial focus remains on reducing debt and optimising our cash position to strengthen our balance sheet, reinvesting for sustainable growth, and returning value to shareholders.
"We celebrate our first-anniversary milestone as a combined entity delivering another quarter of strong results leading SATS back to full-year profitability. This was driven by the aviation sector recovery, improvements in air cargo volumes and better operational performance across the business," said Kerry Mok, president and chief executive officer of SATS.
"SATS is now a global player with a strong international team, and we aim to seize growth opportunities in the global aviation sector to create value for our stakeholders," he added.
Mok noted that SATS is also fully committed to supporting the current and future needs of Singapore's Changi Airport, one of the busiest and most respected airports in the world.
"We have begun delivering on our priorities of restoring profitability, optimizing capital structure, and increasing free cash flow in FY24. We are staying focused on working diligently, around the clock and around the world, to capture even more synergies from the ongoing SATS-WFS integration, streamline our portfolio, and reduce debt. We are committed to developing SATS into a market leader and responsible corporate steward that is future-ready and financially sustainable," the SATS chief further said.
