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56 SIA Annual Report 03/04
Financial Review
Performance of Subsidiary Companies (continued)
SilkAir
2003-04 2002-03
$ million $ million % Change
–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––
Total revenue 226.8 254.1 – 10.7
Total expenditure 210.8 227.0 – 7.1
Operating profit 16.0 27.1 – 41.0
Profit after taxation 15.7 31.6 – 50.3
–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––
SilkAir’s performance was badly affected by SARS because of its regional network. As a result, operating profit fell 41.0 per
cent (–$11 million) because revenue contracted $27 million, but expenditure only fell $16 million (mainly from lower
handling charges, inflight meal costs, airport charges and provision for profit-sharing bonus).
Unit cost rose slightly (+0.1 per cent) to 65.7 cts/ctk. Yield went down 8.6 per cent to 131.6 cents/ltk. Consequently,
breakeven load factor deteriorated 4.3 percentage points to 49.9 per cent.
Shareholders’ funds stood at $327 million (+5.0 per cent) at 31 March 2004.
Capital expenditure for the year of $70 million was mainly for delivery payment for one A320 aircraft, and pre-delivery
payments for two A320 and one A319 aircraft, scheduled for delivery in 2005 and 2006, and spare parts.
As at 31 March 2004, SilkAir’s route network linked 25 cities in 9 Asian countries. During the year, SilkAir terminated its
service to Chittagong (Bangladesh). The airline plans to increase flight frequencies to Xiamen, Fuzhou, Phuket and Yangon
in 2004-05.