Singapore Airlines (SIA) Cargo has seen revenues fall and operating losses deepen on the back of a double-digit yield decline.

During its financial first quarter ending 30 June, SIA Cargo saw revenues decline by S$60 million (US$44.8 million), while its operating result slipped to a loss of $34 million compared with S$9.0 million loss a year earlier. The carrier cited a yield decline of 17.4 per cent as being behind the deepening loss, which came despite a $35 million reduction in operating costs – thanks to lower fuel prices – and a 6.4 per cent increase in demand to 1.7 billion freight tonne kilometres.

“The cargo market remains soft, with economic uncertainty in Europe and China. Cargo yields are expected to remain under pressure as overcapacity persists in the industry,” the carrier said. SIA Cargo operates nine B747-400 freighters as of 30 June, compared with eight at the same point last year.

Cargo capacity at the airline was also up on a year earlier during the quarter, but SIA Cargo still managed to improve its load factor slightly to 62 per cent from 61.1 per cent a year earlier. With yields down, its breakeven load factor stands at 68.7 per cent compared with 63.9 per cent last year.

Meanwhile, the carrier’s overall results saw an almost-tripled bottomline as cheaper jet fuel continued to drive earnings despite weak yields on the passenger side of the business as well. Singapore Airlines’ net profit soared by 182.4 per cent to $257 million as revenue grew 2.1 per cent to $3.65 billion.