The pressure on Singapore Airlines appears to be easing as vaccinated travel lanes support demand for air travel to and through Singapore, seeing the airline post-quarter-on-quarter improvements in passenger traffic and network growth.
Singapore Airlines narrows net loss in latest half-yearly results
In the six months to September 30, Singapore Airlines posted a US$617.8 million net loss. That’s a significant improvement on the US$3.467 billion net loss posted in the six months to September 30, 2020.
“International air travel continued to recover during the first half of FY2021/22, on the back of rising global COVID-19 vaccination rates and as travel corridors came into effect,” said Singapore Airlines in a statement when announcing the results on Thursday.
“The Singapore Airlines (SIA) Group’s passenger traffic (measured in revenue passenger kilometers) grew five-fold year-on-year, with passenger capacity (available seat kilometers) also growing five-fold year-on-year to reach 32% of pre-COVID-19 levels as of September 2021.”
The operating cash deficit for six months to September 30 narrowed to US$78.24 million (or an
average of US$13.29 million per month). After nearly two years of bleeding cash, seeing monthly operating cashflows nearing break-even must come as a welcome relief for Singapore Airlines.
Singapore Airlines Group revenue was US$2.087 billion in the six months to September 30. This is a 73% improvement on the group revenue recorded in the comparable six months in 2020. Passenger revenue was US$441.4 million in the six months to September 30.
A stellar cargo performance at Singapore Airlines
Cargo revenue was up 51% compared to 2020 levels. Cargo revenue in the six months to September 30 was US$1.384 billion. Singapore Airlines says the strong cargo performance reflects the capacity crunch in both air freight and ocean freight and ongoing supply chain disruptions driving air freight demand.
At the end of September, the Singapore Airlines Group had an operating fleet of 171
passenger aircraft and seven freighters. Singapore Airlines itself had 121 passenger aircraft and the freighters. The remaining 50 aircraft belong to low-cost subsidiary Scoot.
In terms of aircraft movements, it was a relatively quiet six months for the Singapore Airlines Group. Singapore Airlines absorbed six Boeing 737 MAX 8 aircraft from now-defunct subsidiary SilkAir. One brand new A350-900 was delivered in June, and the last A330-300 left the Singapore Airlines fleet.
“The SIA Group remains steadfast in its commitment to emerge stronger from the pandemic, as it forges ahead in the second year of its three-year Transformation journey,” the airline’s statement continues.
“Singapore’s quarantine-free vaccinated travel lane arrangements support the safe and gradual recovery of Changi Airport as a major air hub. Air travel demand is expected to grow as vaccination rates rise, especially in countries within the Asia-Pacific region, and as government regulations ease further across key markets.”
Singapore Airlines is slowly rebuilding
By the end of 2021, the Singapore Airlines Group expects its available passenger capacity to reach 43% of pre-pandemic levels. Singapore Airlines and Scoot plan to fly to 73 destinations by the end of the year – around half the destinations served in 2019.
The network is slowly rebuilding. The eye-catching Singapore Airlines A380s will resume flying to London next week and Sydney on December 1. Flights to Houston (via Manchester) are also recommencing on December 1. Flights to Seattle via Vancouver kick off the following day.
After a horror period for the Singapore Airlines Group, the improving outlook will be welcomed. The airline group isn’t back in the black yet, but it is heading in the right direction.