A DEPRESSED AIRCRAFT- maintenance market and higher taxation combined to push Singapore Aerospace's (SAe) net profit down by nearly 19% for the year ending 31 December 1994.

SAe reported after-tax earnings of S$25 million ($17.6 million), compared with S$30.7 million posted in 1993. Company turnover, however, was up by 8.5%, to S$493 million, while its pre-tax profit rose by 3.7%, to $49 million.

SAe's poor performance was caused partially by higher levels of taxation on foreign earnings, such as from its Mobile Aerospace Engineering subsidiary in the USA, which could not be set off against losses from other operations.

Other major contributing factors include the loss of S$11.5 million by SAe's manufacturing operation. Singapore Aerospace Manufacturing and California Avi-Tron have since been sold to Singapore Technologies Ventures (Flight International, 19-25 October), a transaction requiring an additional S$7.3 million write-off.

The group's commercial-aircraft maintenance arm, Singapore Aviation Services (SASCO), lost a further S$6.4 million. SASCO has suffered from intense foreign competition, low rates and a falling US dollar, in which much of its income is denominated.

According to SAe deputy president Gary Yeo, the company does not expect an improvement until 1996-7 and, in the meantime, it "will consider exploring rationalising its operation with a view of remaining competitive".

Source: Flight International