SINGAPORE—Singapore Airlines Engineering Company (SIAEC) is expecting the MRO sector to recover at a relatively slower pace, despite the rapid recovery from the air transport sector.
Unlike its airline counterpart, SIAEC has squeezed out only its first quarterly profit at the operating level since the onset of the pandemic.
“Further recovery in MRO demand will be at a slower pace than the rate of recovery over the past year as airlines manage various constraints to return fully to pre-pandemic flight levels,” SIAEC said in a statement. “In addition, ongoing geopolitical tensions and macroeconomic uncertainties, inflationary pressure and supply chain disruptions present challenges to business recovery and operating margins.” The company said the supply chain disruption remains present in some parts of the business but described it as “manageable.”
In its fiscal 2023/24 first quarter, SIAEC’s line maintenance unit handled 11% more aircraft quarter-on-quarter, 69% year-on-year, recovering to 84% of pre-pandemic levels. Heavy checks increased from 20 to 23 and light checks from 118 to 173 against the same period a year prior.
In all, SIAEC’s revenue improved 52.7% year-on-year to S$261.9 million ($197 million), although the removal of government wage support also saw costs increasing 49% year-on-year to S$261.5 million. SIAEC recorded an operating profit of $400,000, factoring in share of profits of associated and joint venture companies. SIAEC posted a net profit of S$27 million for the quarter.
