Singapore Airlines 2013 Annual Report Download - page 20

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SINGAPORE AIRLINES
OPERATING REVIEW
The Singapore
Airlines Group
achieved a net profit
attributable to equity
shareholders of
$379 million for the
financial year ended
31 March 2013.
The Year in Review
The Singapore Airlines Group achieved a net profit attributable
to equity shareholders of $379 million for the financial year
ended 31 March 2013. This was despite recording a lower
operating profit amid persistently high fuel prices and lower
yields due to weak global economic conditions.
During the year in review, the Parent Airline expanded its
capacity (in available seat-kilometres) by 4.3 per cent, while
passenger carriage (in revenue passenger kilometres) grew
by a higher 6.8 per cent. Passenger load factor improved by
1.9 percentage points to 79.3 per cent. SIA’s wholly-owned
subsidiary, SilkAir, registered passenger carriage growth
of 16.9 per cent but was unable to match the capacity
expansion of 20.2 per cent. Accordingly, passenger load
factor declined by 2.1 percentage points to 73.6 per cent.
SIA Cargo reduced its cargo capacity (in capacity tonne-
kilometres) by 5.5 per cent. As carriage (in load tonne-
kilometres) declined by a higher 6.0 per cent, cargo load
factor dropped by 0.4 percentage point to 63.4 per cent.
Despite the challenging operating environment, the Group
maintained its strategy to grow its overall network, including
through partnerships with other airlines. Compared to 2011,
there was a 41 per cent increase in destinations outside of the
SIA network as a result of codesharing. Airline partnerships
also resulted in growth in the Group’s network in Asia and
Australia. In part due to the Airline’s partnership with Virgin
Australia, the number of flights per week to Australian
destinations has grown by 45 per cent compared to 2010.
Over the same period, SIA’s synergy with SilkAir has helped
to boost the number of flights to China per week by 71 per
cent, while weekly flights to India and Southeast Asia have
expanded by 24 per cent and 27 per cent, respectively. With
greater coordination between SIA and SilkAir in network
planning and sales efforts, the number of flown bookings
with both carriers’ segments increased by 43 per cent
between 2010 and 2012.
Looking ahead, the global economic outlook remains
uncertain with the ongoing weakness in the Eurozone and
sluggish recovery in the United States. Forward passenger
bookings are almost flat and yields are expected to remain
under pressure amid weak economic sentiment. In addition
to high fuel prices, revenues are expected to be further
diluted if key revenue-generating currenices continue to
depreciate against the Singapore dollar.
The Company continuously reviews its network to better
match capacity to demand, and will push ahead with
its strategy of growing its airline partnerships and using
the Group’s portfolio of airlines to tap different market
segments. The Airline continues to focus strongly on