SATS LTD. signed a Memorandum of Understanding (MOU) with Vietnam Airlines on Thursday (March 13) to build and operate an air cargo terminal at Vietnam's new Long Thanh International Airport.

SATS stated on Friday that the collaboration aims to expand the cargo handling capacity of the state-owned airline.

It also seeks to deepen the existing partnership between the two parties in ground and cargo handling services across Vietnam Airlines' international network.

This will include joint efforts to develop air freight and logistics solutions, such as trucking and mid-mile services.

The ground handling company said both parties will also share best practices, productivity metrics, and technologies to enhance operational efficiency and service quality in these areas.

It will also integrate SATS' aviation logistics expertise and global network with Vietnam Airlines' plans to launch the country's first all-cargo airline, contributing to its growing air cargo and logistics industry.

The air cargo terminal is located at Vietnam's new Long Thanh International Airport, which is currently under construction.

The site, situated 35 kilometers from Ho Chi Minh City, is expected to commence phased operations in the second half of 2026.

The new airport will be capable of handling up to 25 million passengers and 1.2 million tons of cargo annually. By 2050, its total capacity is projected to expand to 100 million passengers and 5 million tons of cargo.

For the third quarter ending December 2024, SATS reported a 123.5% year-on-year increase in net profit to S$70.4 million.

Revenue for the period rose 12.5% to S$1.5 billion.

In a business update on February 21, the company attributed the improved profitability to increased business volumes and higher customer rates, driven by operational leverage.

Following the announcement, SATS shares closed up 0.3%, or S$0.01, at S$3.03 on Friday.