SINGAPORE (Feb 4): Singapore Airlines reported a 35.5% rise in 3Q earnings of $275 million from a year ago on lower costs, helping Southeast Asia’s largest carrier attract more passengers with cheaper fares.

Expenses dropped 7.6% to $3.65 billion, largely from a $354 million reduction in net fuel costs. This came from a 41.1% drop in average jet fuel price and hedging loss of $72 million, though it was partially offset by the stronger US dollar against the local currency.

SIA says the challenging operating environment is expected to persist. Expansion of rival full-service airlines as well as low-cost carriers should also continue to exert pressure on loads and yields.

Revenue fell 3.9% to $3.9 billion, driven down by weaker yields from passenger and cargo operations. Passenger yield and cargo yield declined 4.6% and 13.5% respectively.

Except for SIA Cargo, all companies under SIA recorded higher operating profit compared to a year ago. SilkAir in particular saw its operating profit almost doubled to $33 million, driven by lower fuel costs and better passenger flown revenue.

Scoot recorded its best quarterly operating profit since commencing operating, partly from more deployment of fuel-efficient 787 fleet.

SIA Cargo’s operating profit in 3Q fell to $2 million from $17 million a year ago, owing to lower revenue amid industry overcapacity.

The counter closed unchanged at $10.92 on Thursday.