SIA Group reports operating loss in 4QFY2012, pax yield to come under pressure from competition

SIA Group revenue up 3% - financial highlights:

• Three months ended 31-Mar-2012:
  • Total revenue: SGD3705 million (USD2956 million), +3.3% year-on-year;
  • Total costs: SGD3711 million (USD2960 million), +8.5%;
    • Fuel: SGD1446 million (USD1154 million), +16.7%;
    • Labour: SGD568.6 million (USD453.7 million), -0.5%;
  • Operating profit (loss): (SGD5.2 million) (USD4.2 million), compared to a profit of SGD165.8 million (USD132.3 million) in p-c-p;
  • Net profit (loss): (SGD38.2 million) (USD30.5 million), compared to a profit of SGD171 million (USD136.4 million) in p-c-p;
  • Passenger numbers:
    • Singapore Airlines: 4.3 million, +6.1%;
    • SilkAir: 784,000, +12.2%;
  • Passenger load factor:
    • Singapore Airlines: 77.6%, +2.1 ppts;
    • SilkAir: 75.3%, -0.9 ppt;
  • Passenger breakeven load factor:
    • Singapore Airlines: 80.3%, +5.1 ppts;
    • SilkAir: 56.0%, +2.3 ppts;
  • Passenger yield:
    • Singapore Airlines: SGD 11.7 cents (USD 9.33 cents), -3.3%;
    • SilkAir**: SGD157.2 cents (USD125.42 cents), +1.3%;
  • Passenger unit costs:
    • Singapore Airlines: SGD 9.4 cents (USD 7.50 cents), +3.3%;
    • SilkAir**: SGD88.1 cents (USD70.29 cents), +5.6%;
  • Cargo volume: 285,400 tonnes, +1.8%;
  • Cargo load factor: 61.9%, -0.7 ppt;
  • Breakeven cargo load factor: 67.3%, +2.6 ppts;
  • Cargo yield: SGD 35.2 cents (USD 28.08 cents), +1.1%;
  • Cargo unit costs: SGD 23.7 cents (USD 18.91 cents), +5.3%;
• 12 months ended 31-Mar-2012:
  • Total revenue: SGD14,858 million (USD11,854 million), +2.3%;
  • Total costs: SGD14,572 million (USD11,626 million), +9.9%;
    • Fuel: SGD5803 million (USD4630 million), +26.8%;
    • Labour SGD2194 million (USD1751 million), -1.1%;
  • Operating profit: SGD285.9 million (USD228.1 million), -77.5%;
    • SIA Engineering: SGD130 million (USD103.7 million), -4.4%;
    • SilkAir: SGD105 million (USD83.8 million), -13.2%;
    • SIA Cargo: (SGD119 million) (USD94.9 million), compared to a profit of SGD151 million (USD120.5 million) in p-c-p;
  • Net profit: SGD335.9 million (USD268.0 million), -69.2%;
  • Total assets: SGD22,043 million (USD17,587 million), -10.2%;
  • Cash and bank balances: SGD4703 million (USD3752 million), -36.7%;
  • Passenger numbers:
    • Singapore Airlines: 17.2 million, +3.1%;
    • SilkAir: 3.0 million, +9.7%;
  • Passenger load factor:
    • Singapore Airlines: 77.4%, -1.1 ppt;
    • SilkAir: 75.7%, -0.7 ppt;
  • Passenger breakeven load factor:
    • Singapore Airlines: 78.0%, +3.2 ppts;
    • SilkAir: 59.75, +2.5 ppts;
  • Passenger yield:
    • Singapore Airlines: SGD 11.8 cents (USD 9.41 cents), -0.8%;
    • SilkAir**: SGD 153.3 cents (USD 122.31 cents), +4.0%;
  • Passenger unit costs:
    • Singapore Airlines: SGD 9.2 cents (USD7.34 cents), +3.4%;
    • SilkAir**: SGD 91.5 cents (USD 73.00 cents), +8.5%;
  • Cargo volume: 1.2 million tonnes, +4.3%;
  • Cargo load factor: 63.8%, -0.2 ppt;
  • Breakeven cargo load factor: 67.3%, +5.7 ppts;
  • Cargo yield: SGD 34.9 cents (USD27.84 cents), -3.65;
  • Cargo unit costs: SGD 23.5 cents (USD18.75 cents), +5.4%. [more - original PR] [more - CAPA Analysis]

*Based on the average conversion rate at USD1 = SGD1.2534 for 01-Apr-2011 to 31-Mar-2012

**Overall yield and unit costs

SIA Group: "Advance bookings for the coming quarter are higher year-on-year, albeit off a low base from the post-Japanese earthquake period last year. Promotional activities necessitated by intense competition amongst airlines are expected to place downward pressure on passenger yields, especially in Europe and the United States where demand continues to be impacted by the anaemic economic outlook. The recovery of air freight demand will be gradual, possibly only in the second half of the year. Cargo yields are likely to remain stagnant for the next quarter. Fuel prices are expected to remain at high levels, which will adversely impact the Group's operating performance." Source: Company statement, 09-May-2012.