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30
Singapore Airlines Annual Report 05/06
OPERATING
REVIEW
SilkAir
SilkAir earned a net profi t of
$20.6 million for the fi nancial year.
The airline carried 1.26 million
customers; an increase of 20 percent
over the previous year.
During the year in review, SilkAir
launched services to new destinations.
In October 2005, SilkAir took over
from Singapore Airlines services
between Singapore and Shenzhen
and Singapore and Surabaya. The use
of the smaller aircraft by SilkAir results
in higher frequency of fl ights thereby
giving customers more choices in
travel times.
Twice-weekly services to Kota Kinabalu
were launched in December 2005.
The airline also operated a series of
charter fl ights to regional destinations,
including 14 fl ights to Haikou and
11 to Nanning. In addition, weekly
charters were launched to Christmas
Island, Australia.
More personalised service such as
plated main course and choice of
mealtime was introduced for Business
Class passengers on the longer-haul
Chinese and Indian sectors.
SilkAir was ranked one of the
world’s best airlines in the annual
Travel+Leisure 2005 World’s Best
Award readers’ survey. Clinching the
10th spot in August 2005, it became
the only regional carrier to make it
to the leading US travel publication’s
top 10 list. In addition, the airline was
voted Best Regional Airline (Asia and
China) in October 2005 for the sixth
time by members of Asia Pacifi c’s
travel trade in the TTG Asia’s Annual
Travel Awards 2005.
In the same month, SilkAir was
presented with an award of
appreciation from the United Nations
Association of Singapore for its
tsunami relief efforts.
SilkAir returned one A320 to its
lessor in May 2005. The airline took
delivery of two new aircraft – one
A320 and one A319, in September
2005 and October 2005 respectively.
Both new aircraft feature larger
luggage bins and modifi ed seat
confi gurations that provide for
additional economy class seating.
In March 2006, the airline sold and
leased back two A320 aircraft to
Allco Finance Group Limited.
SilkAir’s fl eet, as at 31 March 2006,
comprised fi ve Airbus A319 and
seven A320 aircraft, with an average
age of four years and three months.
Singapore Flying College
To manage the increase in demand
for fl ight training, Singapore Flying
College acquired three more Cessna
172Rs during the fi nancial year,
bringing the fl eet size to 37 aircraft:
four Learjet 45, six Beech B58
Barons, 21 Cessna 172Rs and six
Cessna 152s.
During the year in review, a Learjet
45 Integrated Procedures Trainer was
commissioned. A second simulator
arrived at the advance training
facility in Maroochydore, Queensland
and is undergoing testing and
certifi cation.
The Singapore campus of the
College achieved ISO 14001
certifi cation for the implementation
of the Environmental Management
System, while the Jandakot branch
was awarded the ISO 9001 certifi cate
for qualities and systems.
Singapore Aircraft Leasing
Enterprise
There was a strong recovery in aircraft
leasing markets during the last year,
following the downturn which began
in 2001. As a result, the existing
portfolio of Singapore Aircraft Leasing
Enterprise (SALE) generated improved
returns as new leases were signed,
while the quality of the company’s
customer base was signifi cantly
strengthened.
SALE continued to increase the size
of its portfolio, taking delivery of 17
new aircraft. These included seven
Airbus A320s ordered directly from
the manufacturer, and 10 Airbus
A319s acquired under purchase and
leaseback agreements with airlines. The
deliveries brought the total number of
aircraft acquired by SALE since it was
established in 1993 to 101.
SALE fi nalised a contract with Boeing
in May 2005, covering fi rm orders for
20 Next-Generation B737-800 aircraft.
This order represented a signifi cant
diversifi cation of SALE’s portfolio. By
31 March 2006, the fi rst nine aircraft
from this order had already been
placed with airlines, for delivery in
2006 and 2007.
At year-end, the SALE portfolio
totalled 79 aircraft, comprising 72
owned by the company and seven
managed on behalf of third parties.
The aircraft were fl ying with 32 airlines
worldwide. The fl eet remains one of
the youngest in the leasing business,
with an average age of just four years.