SATS has suffered losses for 3 consecutive years but will not be included in SGX watch list

SINGAPORE: SATS Holdings Limited (SATS), which is listed on the Singapore Exchange (SGX) mainboard, has disclosed a consecutive three-year streak of pre-tax losses in a statement released on Sunday (26 Nov). Despite this financial setback, the company has revealed that it will not be included in SGX’s watch list, which is a relief for investors.

The audited full-year results unveiled by SATS Group showed losses over the past three fiscal years. However, the group’s average daily market value for the six months ending on Nov 23 was reported to be close to $39 billion, thereby exempting it from SGX’s watch list inclusion criteria.

Under SGX’s listing rules, companies on the mainboard face watch list inclusion if they undergo pre-tax losses for three successive financial years and are unable to maintain an average daily market capitalization of $40 million in the preceding six months.

SATS made public its financial results for the first half of fiscal year 2024 on Nov 10, revealing a net loss decrease from $32.5 million to $7.8 million compared to last year. The group’s financial trajectory took a positive turn in the second quarter, recording a net profit of $22.2 million after a loss of $29.9 million in the first quarter.

This marked a significant milestone, as it was the first time the group achieved profitability without government assistance amid the COVID-19 pandemic.

In a bid to reassure investors, SATS emphasized that SGX conducts quarterly reviews of companies on the watch list. In the event of inclusion, the company committed to promptly notify its investors.

On Friday, SATS’ stock closed with a 1.10% decrease, equivalent to 0.03 cents, settling at $2.71. The market’s response to SATS’ financial performance and its exclusion from the SGX watch list will be closely observed in the coming weeks as investors digest the implications of the company’s strategic financial decisions.