Good evening, everyone. Welcome to the SATS third-quarter results briefing for financial year 2026.

I'm David, Group Head of Strategic Communications. Before we begin, I turn your attention to the forward-looking statement now on screen.

Now for our safety reminder. Whether you're joining us from the office, at home, or on the road, please be aware of your surroundings at all times.

Do make your safety a priority before joining this call, a recording of which will be available on our website. With me today are Kerry Mok, SATS President and CEO, and Timothy Tang, our CFO.

I will hand over to Kerry to take you through the business update. Kerry, please.

Thank you, David, and good evening, everybody. I appreciate you guys taking time out on Friday evening to join our earnings call.

Let me just quickly go into the third-quarter performance. I'm pleased to say that the third-quarter performance has been really solid.

We have record cargo volume driven obviously by a seasonal peak. You would recall that last quarter we did say there was some forward loading as well, and we benefited from that.

Despite that, the number for this quarter was record. In fact, in our history, this is probably the highest quarter we have ever got in our history.

Year-on-year growth is across all lines of business. We also continued to outperform IATA's number for the ninth straight quarter, and that's driven a lot by APAC and EMEA growth, which more than offset some of the de minimis impact in Americas, and tariff impact as well.

We continue to show good commercial progress. We have won a new cargo and ramp contract with China Cargo in Paris and with Saudia Cargo also in Americas.

I'll share a bit more new wins in my updates later. From a revenue standpoint, 8% growth against last year.

Very pleasing to see the margin expansion to almost $300 million EBITDA, to 18.1% margin. PATMI has grown 20% to $84.7 million.

Really what is pleasing for us is the resilient network continues to capture trade flows and shifts. All the uncertainty in the geopolitical environment and the tariff situation, so far we have been benefiting from all the different shifts primarily because of the network that we have.

Just on the food side, aviation meals have grown 4.5% year-on-year, and non-aviation meals have also shown a 7.7% growth to 10.5 million meals this quarter. Next slide.

As I mentioned, we also won two new wins. One is Allegiant Air in Sanford Airport, which is their hub airport in the US, and Azul in Viracopos Airport, which is actually in São Paulo.

Azul is actually the largest low-cost carrier in Brazil, and we are actually their hub provider for ground handling in Brazil. That's a fantastic win for our team in Brazil as well, and we continue to grow our presence in Brazil with some of these wins that we have locked in.

On the food side, very pleasing to say we have won a multiyear inflight catering contract with Turkish Airlines. Turkish Airlines is leveraging on our halal-produced meal out of Narita and Haneda, and it's been a contract that we've been aiming for quite some time, and very happy that our team in Japan managed to secure the contract with Turkish Airlines.

We continue to reinvest in our infrastructure. We recently signed a 20-year lease for a new warehouse in London Heathrow.

This is really to grow our business in Heathrow. As if you look at Heathrow Airport at the Horseshoe area, many of the facilities are actually aged as well.

This will be a first new facility in Heathrow, and we believe that's going to help us gain more business in London, but at the same time allowing us to put a more modern warehouse in Heathrow to support the growth of air cargo over there. We have also expanded our e-commerce and freight forwarder handling business in Frankfurt Airport.

We took a facility, old facility previously from DHL, and we converted for usage, and we're now starting to roll out those services for freight forwarders in Frankfurt. As Frankfurt is the biggest cargo hub in Europe, our ability to provide additional services for our targeted customers in freight forwarding is actually a very important part of our specialized services focus.

In Singapore, closer to home, we just broke ground on a extension of our maintenance center. Again, this is in preparation to put more capacity so that we can actually service more of our ground units here, GSE equipment here in Singapore.

As we have also announced the refreshment of our equipment here in Singapore, and therefore we need this extension to service the additional capacity that's required. On the technology side, with our investments in AI continues to reap our benefits.

We have launched our first AI control tower to monitor our supply chain on the food side, and this is a very important milestone for us because the system that we developed here can have different usage going forward, and control tower using AI is going to be a big part of how we're going to run our business globally going forward. Then on the employer side, we are pleased that we are recognized as one of the top 20% employers in the SG Opportunity Index that's led by the Ministry of Manpower, and we've also been certified as a top employer in Singapore by the Top Employers Institute.

This continues our focus on making sure that we are a great place to work for many of our employees, and we really want to make sure that this aspect is taken care of so that we can continue to attract our share of talent here in Singapore. Next slide.

This is just to show you all the business drivers. As you can see, from a tonnage standpoint, that last quarter we hit almost 3.5 million tons.

That's a almost 6% growth over the previous quarter. Flights handled continues to show modest growth as well, and meals is now above 50 million in terms of the meals served.

Likewise, from employee standpoint, there's a slight growth in there primarily driven by the hiring in Brazil to take care of the ground handling operation itself. Next slide.

This slide shows you the like-for-like tonnage growth versus non-like-for-like. Again, a growth of about 7.3% over last year.

The pleasing thing is the non-like-for-like growth where we are showing additional new wins of 7.1% is continued to power our growth in air cargo. Next slide, please.

Yeah. Maybe I'll hand that over to Tim to take you through the financial summary.

Tim?

Thanks, Kerry. Good evening, everyone, as well.

Great to be here to obviously announce our results again. Let me add a bit more color to the high level that Kerry's obviously covered.

Obviously, I'm very pleased with the overall results as well, as Kerry's already noted. Primarily, I would say the main themes are that actually both year-on-year growth in revenue and earnings have been actually very, very consistent and directionally very consistent with the year-to-date or first-half results.

What's pleasing, of course, is that we do know that disruptions are taking place in particular with trade flows around the world, but our network is definitely very resilient in capturing that rerouting, and that continues along with obviously the capturing of the new customers as well. We have seen the results in particular from a margin standpoint normalize in Q3 in particular versus Q2.

I think many of you on the call would have remembered that we did say that our Q2 results benefited from pull-forward volume, which actually went ahead of our cost structure. Some of that cost structure definitely was not sustainable in order for us to fully serve our customer in the right way as we continue to develop our relationship with them.

The Q3 results is a normalization into what a peak cost structure should look like. I think we're very pleased to see that on a year-on-year basis in particular, you can see the continued growth of our business both in top line and bottom line along with margins.

If I dive into the details of the next slide, on slide 8 there, more color then, as you can see then, along all the lines of the business. Cargo, very, very quick step-by-step on the businesses.

Obviously, cargo continues to be driven by both organic and inorganic growth. In particular, continue to be very, very strong in Europe and Asia-Pacific.

Weaker in Americas, but we are seeing that business supported by our service of Amazon in that market, which we've talked about in the past that we are the largest third-party contractor for Amazon across nearly 13 13 stations in the US, and that business actually has continued to grow as Amazon activity continues to grow as well. Our ground business is obviously moving along very, very well.

Still a lot of contribution there obviously from our Singapore market, a little bit more stable obviously, in particular the results align with our main customer in Singapore. That is likewise the case for the aviation on the food side, on our aviation food solutions.

I think many of you would have seen that our main customer in Singapore had their passenger growth outside of Scoot roughly around 2% to 3%. It's very indicative of some of the trend that drives our aviation food as well.

Non-aviation, obviously, the year-on-year continues to be a focus obviously of ours to fill the capacity, but we are obviously looking at that as just a subsegment that supports our overall results from a group perspective. Next slide, please.

Diving into a bit more on the year-on-year result, which is the one that shows the real trend of the business. On a year-on-year basis, as I've noted, obviously, revenue-wise outgrowing our operating cost, we are getting that margin expansion given that the peak is really comparative over on a year-on-year standpoint.

We saw great growth around the world that supports that third-quarter peak. When I say that our results show that that was brought forward in Q2, we do see that Q-on-Q basis from second quarter to third quarter, the growth was definitely more muted versus prior years.

That was the benefit of then that cost structure in Q2, but having normalized down, now you would all observe that our third-quarter margin is actually very similar to our first-quarter margin, and obviously, both quarters showing that positive year-on-year growth, which represents the business model working and obviously leveraging on our overall scale. Moving down the page, obviously, there is a normalization also on our SOW JV.

You would all recall that in the last quarter, we also noted there was some upfront cost impact in our SOW JV, where some additional costs that we invested into in particular in picking up and starting new customers in our SOW JV. Suffice to say that that's normalized out also in Q3, and our results show a strong year-on-year growth there in the third quarter, which I think we do see that that third-quarter performance will obviously continue from here on, from a seasonality basis.

Lastly, then all the way to the bottom line, once again, I would remind everyone that we did say the last quarter we had a one-off adjustment on our tax line in the Q2 results. Once again, as you look at the third-quarter results, that in itself has also normalized.

Overall, then, if you put all that into play, obviously, we're gaining the natural margin accretion obviously on a year-on-year basis, and the results are showing good momentum obviously heading into our fourth quarter, which is traditionally our lower quarter of the year, which we'll touch on in a minute as well with Kerry to finish up. Next slide, please.

Diving into a few more metrics, and I will leave the cash flow a little bit to the next slide, but I'll highlight a little bit of context. I think no major surprises now.

I think most of the metrics on the left-hand side there is just consistent with the announcement of the results, and I think we all would agree it's a good set of numbers to see the business deliver. From a cash flow perspective, the third quarter year-on-year is impacted by a significant timing and working capital that actually occurred last year.

I will recommend that we look at the year-to-date cash flow as a more true representation of where we are at the moment, which I'll touch on in the next slide. I think beyond that, obviously, the organization continues to address our debt, and we continue to pair down the borrowings, and we do see that number as progressing towards a target that we believe probably end up in the full year at around this sort of 160-odd million range.

Ultimately, we do believe now going forward, our debt level continues to be now at a level that's much more manageable, and we see then good opportunity for us to deploy that capital into capex. Obviously, there's the dividend conversation coming up at the end of the year, and any excess cash returning to the shareholders, which we can certainly address more details later on.

Overall, I think that on the right-hand side then, no major call-outs here. I think all the metrics then are obviously moving the right direction given the set of operational and financial results that we're seeing across the business, outside of the cash conversion on the bottom right there, primarily driven by higher capex on a year-on-year basis.

If you look at that cash conversion on a like-for-like comparison with the same capex as last year, we are up just a little bit above 70% on that metrics if you normalize that out. If I move then to my last slide here on the cash flow, let's take a look at that on a year-to-date basis.

Overall, I think operational cash flow year-on-year is obviously positive given our overall results. That number is actually negatively impacted by two areas.

Number one, there is a timing on working capital, and obviously, the team and I continues to manage that, and we believe that we do see that timing coming back to us as we work through that in Q4. There is another impact in there in the sense that there is a higher tax component for cash basis this year versus prior year, mainly because last year's tax was benefited from some COVID-related carryforward losses still, which then were fully utilized in FY '25.

Therefore, once again, I would say that the FY '26 is the clean number, and we do see that obviously that delta then contributes to the overall year-on-year cash flow from operations there. Beyond that then is really down to higher lease payments and obviously related to our new facilities both in Amsterdam and Menzies facility, and our new warehouse in particular in London, and a few other small ones.

Obviously, outside of that then, you can see that the capex is also certainly a significant increase on a year-on-year basis. The primary component of some of that capex is because of our food facility in Thailand and also the finishing of our Singapore Cruise Centre, of which that's largely being completed.

Beyond that, it is as expected, our capex. We are still traveling at around this 4.5% of revenue range, which is obviously within our guidance that we have talked about in the past, sort of between this 4% to 6%.

Overall then, given the capex profile, that is obviously what's driving our overall free cash flow to be lower in particular at the very bottom of the page. I'll hand it back over to Kerry to finish us off on the outlook.

Thank you, Tim. Let me just go quickly on the outlook.

I think we'll break it down to the three areas of cargo, ground, and food. Cargo, as we have said previously, fourth quarter, we expect our demand to moderate.

It's our traditionally weakest quarter for the whole year, we're expecting the same momentum as well. I think overall cargo trends remains very resilient.

There's still a lot of support for high-value, time-sensitive cargo and e-commerce shipment as well, especially with Asia-Pac leading that in terms of the export. Semiconductor and AI-related cargo in tech product is still very much in play as well.

We do have a healthy pipeline of growth opportunities with our customers, and we believe that's going to help us sustain our above-market growth. IATA has predicted a growth forecast of 2.6%.

We believe we can beat that number as well this year. We're actually quite optimistic for cargo for the whole year ahead.

Fourth quarter, well you'll see some traditional slowdown, and Chinese New Year, freighters were not flying as well, those are numbers that we expect to have impact on the fourth quarter. On the passenger service side, I think APAC is going to be the leading light.

Continues to show growth of over 7%, and we're well pleased in APAC with many of our ground handling stations and key hubs performing well, we expect that to continue. US domestic market will remain very soft, and that's how we are seeing it in our current estimates as well, which is in line with what's happening overall in the US market.

We are making good progress with our units in Brazil, and I think the wins in Azul and all that will continue to be a big focus. We are looking to try and win more share of wallet with our existing customer to help mitigate some of the flattish numbers that we are seeing in the US.

On the food side, again, fourth quarter is also typically softness as well after Chinese New Year. We believe international travel will support a lot of demand, particularly out of Singapore.

Our central kitchen network is getting traction. In China, we've onboarded a large customer in our Tianjin facility, though I think whilst it's still initial stage in terms of the volume, but the momentum in developing products and all that in serving the Chinese market is going well, and we hope to ride on the momentum to do more with the customer there in China.

With that, maybe I'll just one last bit to just showcase where are we progressing in terms of FY '29 ambition. I think you can see from across all metrics, I believe we are progressing well.

EBITDA margin is now year-to-date 18.6%. Our EBIT margin is 9.2%.

SOW JV run rate is now 114, and I think our PATMI margin is now coming at 5%. Clearly, we're not going to stop here.

We continue to drive more improvements, and we believe that there are still improvements coming in our margins that we can show going forward. Q4 will dampen the margin a little bit, but, again, longer term, we believe we still some ways to go to drive some synergies and, well, cost-down effect as well.

ROE is at 10.4%. We hope to still make improvement in this area.

From a debt perspective and cash flow perspective, again, progressing well against all the targets that we set for ourselves. With that, I end our presentation.

We open for Q&A.