Singapore Airlines (SIA) on Thursday reported a 39% increase in its full-year operating profit to $2.4 billion, with revenue reaching a record $20,522 million. However, its net profit declined sharply due to the absence of a prior-year one-time accounting gain and its share of losses from Air India (AI), in which SIA holds a 25.1% stake.
Net Profit Decline
The SIA Group's net profit fell by $1,594 million (57.4%) to $1,184 million. This was primarily because of the absence of a $1,098 million non-cash accounting gain recognized in November 2024 upon the completion of the Air India-Vistara merger. Additionally, the swing from a share of profits of associated companies last year to a loss this year (-$846 million) was due to SIA accounting for its share of Air India's full-year losses, compared to only four months in the previous year.
Commitment to Air India
Despite Air India's financial struggles, SIA reiterated its commitment to its investment in the Maharaja. The airline stated that Air India remains a core component of SIA's long-term multi-hub strategy. SIA is working closely with Tata Sons, which owns the remaining 74.9% stake in AI, to support Air India's multi-year transformation program.
Air India faces several headwinds, including industry-wide supply chain constraints, airspace restrictions, operational limitations in key Middle East markets, and elevated jet fuel prices. Nonetheless, SIA noted that Air India is making progress in fleet renewal, aircraft retrofit programs, initiatives to elevate end-to-end customer experience, and improving operational performance.
Leadership Changes
SIA has increased its engagement with Air India in recent times, especially as AI has faced a series of challenges over the past year. Apart from the mentioned headwinds, the Air India 171 crash in June 2024 dealt a serious blow to the airline. Among those reportedly in the running to become Air India's next CEO is SIA senior vice president Vinod Kannan, who was formerly CEO of Vistara. Other contenders include AI Chief Commercial Officer Nipun Aggarwal and two expatriates.
SIA emphasized that its strategic investment provides the group with a direct stake in one of the world's largest and fastest-growing aviation markets, complementing its Singapore hub and strengthening long-term growth.
