Singapore Airlines 2013 Annual Report Download - page 13

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ANNUAL REPORT 2012/13
Stephen Lee
Chairman
The last financial year was one of significant development for
the SIA Group. This year’s Letter to Shareholders will therefore
focus on the many important steps forward that have been
taken to ensure we retain our industry-leading position.
The 2012/13 financial year was an especially busy one for
management and staff, with numerous initiatives to strengthen
the three main pillars of our brand promise, namely Service
Excellence, Product Leadership and Network Connectivity.
Singapore Airlines enhanced its network during the year
while it also ordered more Airbus A380s and A350s. At the
same time Boeing 787 orders were transferred to Scoot,
which launched in June as the fourth airline in the SIA Group.
Scoot has been steadily expanding its network and the business
has proven to be a success to date, with a good customer
following and healthy passenger loads.
Regional full-service arm SilkAir also continued to add new
destinations to its fast-growing network and placed the biggest
aircraft order in its history.
In-flight connectivity was launched on Singapore Airlines’ long-
haul aircraft and a large contract was signed with Panasonic
for the supply of new in-flight entertainment systems. A retrofit
programme was launched for Boeing 777-200ERs to fit them
with new Business Class seats and larger in-flight entertainment
system screens in Economy Class. Our lounges around the
world will also be revamped from this year with a new design
concept, while the next generation of in-flight cabin products
will be rolled out in the coming months.
The Group has also been investing in upgrading IT systems.
In July, Singapore Airlines and SilkAir cut over to a new
inventory and reservations system, which was followed recently
by an upgrade of check-in systems.
Customer service is also not being overlooked, as it remains
a crucial differentiator. To help deliver an enhanced travel
experience that focuses on meeting more of our customers’ travel
needs, a contract was signed recently with Accenture for the
development of a new Customer Experience Management (CEM)
system. Implementation is scheduled for the second half
of 2014 and it is one element of a multi-million-dollar
investment programme.
Ultimately it is our people who make the real difference in
setting us apart from the competition. The new CEM system will
help our employees – who are our greatest asset – to deliver
even better experiences to our customers.
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ANNUAL REPORT 2012/13
New partnerships were also agreed with more airlines during
the last financial year to provide customers more choices of
flights through codeshare arrangements. We acquired a 10 per
cent stake in Virgin Australia in October, and recently agreed
to acquire another 9.9 per cent. Agreement was separately
reached on the sale of our 49 per cent of Virgin Atlantic
Airways. Subject to regulatory approvals, the transaction should
be completed late this calendar year.
The many developments outlined above are all intended to
ensure that the SIA Group is well positioned for the future,
in an increasingly competitive landscape. In addition to
remaining a leader in the delivery of innovative products and
services, our portfolio approach to airline operations positions
the Group well for different business cycles, with Singapore
Airlines and SilkAir on the premium end of the spectrum and
Scoot on the low-cost end in partnership with Tiger Airways,
in which we have a strategic stake.
Before I conclude, allow me to put on record my appreciation
to my fellow Directors for their contributions over the past
year. During the last financial year we welcomed to the
Board Mr Hsieh Tsun-yan and Mr Gautam Banerjee, while
Mr David Gonski retired from the Board. Allow me to express
on behalf of the Board and Management our thanks to David
for his many contributions over the years.
I would like to close by expressing my gratitude as always to
shareholders for your continued support, particularly given the
significant investments we are making. Operating conditions
remain challenging, but the state of the SIA Group is strong.
The Board and Management are confident that the developments
of the past financial year as well as those that are planned will
ensure that this remains the case in the years ahead.