Singapore Airlines (SIA) posted a net profit of S$397 million for the third quarter ending Dec 31, 2005, which is a decline of S$68 million or 14.6 per cent from a year ago due to the high fuel costs.

The net profit was achieved on the back of a revenue of S$3,557 million, which was a record for any quarter, according to a Bernama report.

The revenue was higher by S$355 million or 11.1 per cent from the previous corresponding period due to the growth in carriage and yields for both passenger and cargo operations, SIA said.

The Group's operating profit stood at S$375 million during the quarter, which was however lower by S$38 million or 9.1 per cent from a year ago as the increase in expenditure outpaced revenue growth.

"The Group's expenditure on fuel, net of hedging, rose 49.2 per cent to S$1,183 million," SIA said in a statement.

More passengers

Fuel accounted for 37.2 per cent of the Group expenditure, up from 28.4 per cent in the same quarter a year ago. Higher fuel price alone added S$243 million to Group expenditure, it said.

The number of passengers carried in the third quarter was 4,364 million, up 3.9 per cent from a year ago - the highest recorded for any quarter. SIA Cargo carried 9.7 per cent more freight (in load tonne kilometres) than the corresponding period last year, it said.

SIA said that the outlook for air travel in 2006 is encouraging, given the sound economic outlook for the major markets but fuel prices would continue to be a concern to the Group.

"On the competition front, new entrants and established carriers continue to compete for market share. Singapore Airlines will continue to respond to these challenges and be competitive," it said.