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Singapore Airlines significantly narrows first-half loss as passenger outlook improves
November 12th 2021
The Singapore Airlines (SIA) Group expects to reach 43% of pre-COVID-19 capacity by December after revealing a significantly lower interim net loss of S$837 million, down from a crippling S$3.47 billion loss in the same period a year ago. Read More » The opening of borders through Vaccinated Travel Lanes (VTL) and an improved traffic outlook will see the group serving just over half of its pre-pandemic ports, or 73 destinations including Singapore. SIA said it remained ready to capitalize on revenue and growth opportunities as they arise and that it would adjust its capacity accordingly “while maintaining operational resilience and cost discipline”. “Since the start of the pandemic, the group has proactively taken steps to review all aspects of our operations to ensure we are able to quickly ramp up as air travel recovers,’’ it said in its outlook. Singapore began re-opening its borders in early September with the establishment of VTLs with Germany and Brunei. SIA Group’s VTL network now stands at 21 cities in 14 countries after the system was expanded to Australia, Canada, Denmark, Finland, France, Italy, Malaysia, the Netherlands, South Korea, Spain, Sweden, Switzerland, the UK and the U.S. Growth in the fourth quarter included services to Cape Town, Kathmandu, Manchester and Rome, while low-cost offshoot, Scoot, resumed flying to Berlin. The airline also announced its A380s are returning to the operating fleet with flights to London starting November 18 and to Sydney from December 1. Routes in the pipeline include Houston (via Manchester) from December 1 and Singapore-Seattle-Vancouver from December 2. Scoot will start Singapore-Seoul Incheon from November 15 and Davao in the Philippines from December 1. From a financial perspective, the group’s operating loss shrank from S$1.86 billion in the first half of fiscal 2021 to S$619 million in the latest period as revenue surged to S$2.8 billion thanks to improvements in both the passenger and cargo segments at the group. Passenger flown revenue rose by 358% to S$598 million and cargo flown revenue reached a record high of S$1.875 billion, up 51.2%. Expenses were down by 1.5%, to S$3.45 billion, mainly due to the absence of ineffective fuel hedges. Unlike many of its Southeast Asian rivals, SIA has managed to bolster its cash and bank balances, which rose S$4.7 billion during the first half to S$12.5 billion, primarily from the issue of mandatory convertible bonds. Fleet changes included the transfer of six 737 MAX 8s from SilkAir to SIA after the Civil Aviation of Singapore removed restrictions imposed on the Boeing type in the wake of two fatal crashes. One A350 was delivered to the company in the first quarter and began operating in the second quarter. Also, its last A330 exited the carrier. At September 30, SIA’s operating fleet was 121 passenger aircraft and seven freighters, while Scoot added an A321neo to bring passenger aircraft to 50.
