SATS, the provider of gateway services and food solutions, said earnings for 1Q FY13 ending June 30 fell 2.8% to $41.3 million from a year ago.
Revenue grew 13.6% to $437.9 million, supported by the continued uptrend in flight and meal volumes in Singapore as well as higher volumes recorded by overseas subsidiaries, SATS HK and TFK in Japan.
Revenue from gateway services and food solutions ex-TFK rose 8.1% and 9.1% respectively while TFK reported a 40.7% year-on-year recovery in its revenue to $83.7 million following the March 2011 disasters.
Operating expenditure increased 12.6% due to higher headcount and statutory levies as well as increase in cost of raw materials and other variable costs arising from higher volumes.
Despite this, group operating profit was up 24.4% to $39.3 million, driven by the steady rebound in TFK.
Share of results of associates and JVs, net of tax, rose 2.6% to $11.7 million, led by higher profit contributions from associates and JVs in the North Asia region.
However, the absence of tax credits in TFK in the current quarter and one-off reduction in obligations under its revised retirement benefit plan reported in 1Q FY12 saw earnings decline 2.8% to $41.3 million.
Excluding the loss of $2.8 million from Daniels Group and one-off reduction from TFK’s revised retirement benefit plan in 1Q FY12, underlying net profit from continuing operations improved 3.8% from a year ago.
SATS said the group’s balance sheet remained strong as equity attributable to owners of the Company stood at $1.55 billion while total assets increased from $2.12 billion in the previous quarter to $2.19 billion, and cash and cash equivalents rose from $470.1 million to $532.2 million. Free cash flow generated during 1Q FY13 was $53 million and debt-to-equity ratio was 0.11 times.
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