Singapore, 27 July (Argus) — Singapore Airlines (SIA) posted a S$253mn ($185mn) profit in its fiscal first quarter despite soaring jet fuel costs.

The airline's revenues grew by 20.7pc to S$3.47bn in the April-June period, reflecting what it said was a recovery in load factors. Expenditure grew by 0.8pc or $$24mn. This was driven mainly by rising jet fuel costs, which cost the company 42.4pc or S$313mn more for the quarter compared with 2009. SIA lost S$78mn from its fuel hedging activities, but this was still sharply lower than the S$287mn incurred during the same period in 2009.

SIA recorded a S$307mn loss during April-June 2009 when the global economy appeared headed for a severe downturn.

Jet fuel prices remain a concern for SIA. Market uncertainties resulted in forward prices being higher than spot ones, which raised the cost of hedging, it said.

Passenger and cargo air traffic appear to remain on track for a continual rebound, SIA said. Advance bookings suggest that the recovery could hold up for the rest of this year, while shipping indicators imply that the rebound in air freight could be sustained in the short term even if its rate of growth might slow, SIA noted.

SIA has been slow to restore capacity despite rebounding air traffic. Its passenger carrying capacity was down 2.81pc in the first half of the calendar year compared with the same period last year. Cargo capacity also edged down by 1.4pc for the same period.

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