SATS reverses into earnings of $56.4 mil for FY2024, plans final dividend of 1.5 cents

FY2024 revenue increased three-fold to a record $5.1 billion on the back of improved cargo performance and travel recovery.

SATS has posted earnings of $64.1 million for its 2HFY2024 ended March, compared to the $6 million recorded in the same period last year.

The company also swung back into the black for FY2024, reporting earnings of $56.4 million after taking into account higher interest expense. In FY2023, SATS reported a loss of $26.5 million.

Its 2HFY2024 revenue increased by 182.2% y-o-y to $2.7 billion, primarily driven by the consolidation of Worldwide Flight Services (WFS) which has given SATS increased  market share and generated network synergies.

For the full year, revenue increased three-fold to a record $5.1 billion, on the back of improved cargo performance and travel recovery.

SATS expenditure in its 2HFY2024 increased by $1.6 billion y-o-y to $2.5 billion due to volume growth, WFS consolidation and price hikes for goods and services. Operating profit stood at $172.2 million, reversing from a $5.7 million loss in the same period last year.

In FY2024, SATS recorded expenditure of $4.9 billion, up 171.6% y-o-y. This is due to various factors including the need for more resources to handle higher volumes, inflationary pressures and the absence of government reliefs. Operating profit for the full year stood at $244.2 million, reversing from a loss of $48 million recorded in the previous year.

The share of earnings of associates and joint ventures in FY2024 increased by 142.3% y-o-y to $110 million, with improved performance from the majority of aviation associates and joint ventures.

As at March 31, total equity reached $2.6 billion. Current liabilities increased to $2.8 billion mainly due to the addition of WFS’s lease liabilities, among others.

Operating cash flow for FY2024 increased to $512.1 million from $79.6 million recorded in the corresponding period last year. Free cash flow after lease payments for the full year was an outflow of $48.2 million, a $51.7 million improvement y-o-y.

SATS board of directors has recommended a final dividend of 1.5 cents per share.

Looking ahead, SATS’s financial focus remains on reducing debt and optimising its cash position to strengthen its balance sheet; reinvesting for sustainable growth; and returning value to shareholders.

“We have begun delivering on our priorities of restoring profitability, optimising capital structure, and increasing free cash flow in FY2024. 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,” says president and CEO Kerry Mok.

Shares in SATS closed 1 cent lower or 0.37% down on May 29 at $2.64.

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