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28
Singapore Airlines Annual Report 05/06
OPERATING
REVIEW
SUBSIDIARIES AND ASSOCIATED
COMPANIES
Singapore Airport Terminal
Services Ltd
Singapore Airport Terminal Services
(SATS) earned a net profi t of $188.6
million for the year, 12.4 percent
more than last year.
During the year in review, SATS
forged new partnerships in China
and the Middle East.
An agreement was signed in
February 2006 with Pakistan
International Airlines Corporation
to provide technical services in the
overall management of its Karachi
fl ight kitchen, as well as to form
infl ight catering joint venture at
Karachi, Islamabad, Lahore and other
airports in Pakistan.
In the same month, SATS also
entered into a two-year partnership
with Qatar Aviation Services to
upgrade ground handling capabilities
at Doha International Airport.
In March 2006, SATS signed a joint
venture agreement with China
Aviation Qingdao Liuting Airport to
set up the Qingdao Airport Cargo
Service Co., Ltd. SATS will provide
cargo handling services to domestic
and international airlines at Qingdao
Liuting International Airport in
Shandong province, China.
SATS expanded its client list with the
addition of Jet Airways in April 2005,
Air Sahara in May 2005 and Pakistan
International Airlines in June 2005.
This brings to 52 its total airline
clients. Currently, operations
extend to 25 airports in 10 countries
throughout the Asia-Pacifi c region.
During the year, SATS launched a new
corporate look and brand promise. In
November 2005, a new logo, along
with the tagline – One With You – was
introduced.
In July 2005, SATS launched a
$23 million products and services
upgrade in Singapore to enhance
passenger service, strengthen the air
cargo hub and improve the infl ight
dining experience. The upgrade
covered both hardware equipment
and skills/service investments.
SIA Engineering Company
SIA Engineering Company (SIAEC)
earned a net profi t of $230.6 million,
35.3 percent more than last year. The
year in review saw SIAEC extend its
capabilities and form new partnerships
through strategic joint ventures.
During the year, SIAEC prepared to
carry out B747-400 Passenger-to-
Freighter (PTF) conversions and to
service the A380 and the B777-300ER.
A fi fth hangar, commissioned in June
2005 to specialise in PTF conversion
work, is expected to begin in August
2006. The PTF business is part of
SIAEC’s strategy to offer a complete
suite of maintenance, repair and
overhaul services at its one-stop
maintenance hub in Singapore.
To gear up for the two new aircraft
– A380 and B777-300ER at the end
of 2006, engineers and technicians
were trained in the structure and
systems of the new aircraft types.
New equipment was also acquired.
In April 2005, SIAEC announced
new joint ventures with Aviation
Partnership (Philippines) Corporation
and Aerospace Component
Engineering Services Private Limited
(ACE Services).
Aviation Partnership (Philippines)
Corporation was formed with
Cebu Pacifi c Air to offer line
maintenance at up to 14 airports in
the Philippines. This joint venture is
SIAEC’s third line maintenance joint
venture outside Singapore.
ACE Services was formed with
Parker Hannifi n Corporation’s
Parker Aerospace Group to provide
MRO services of hydro-mechanical
equipment for aircraft such as the
Boeing B747-400 and B777, and the
Airbus A320, A330 and A340. Its
capability qualifi es it to support next
generation commercial aircraft such
as the Airbus A380 and Boeing 787.
It is also the fi rst facility in the region
to provide OEM support of Parker
components and systems.