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FY 2013/14

Table of contents

  • Page 1
    FY 2013/14

  • Page 2

  • Page 3
    ... in the right direction." 070 FINANCIALS 214 NOTICE OF ANNUAL GENERAL MEETING 024 PRODUCTS AND SERVICES 032 COMMUNITY ENGAGEMENT 028 PEOPLE DEVELOPMENT The Airline was named the "Most Attractive Employer in Singapore" by Randstad Singapore for the third consecutive year. 012 CORPORATE DATA 016...

  • Page 4
    ...Total debt equity ratio (times) Value added Per Share Data Earnings - basic (cents) R4 Earnings - diluted (cents) R5 Net asset value ($) R6 Dividends Interim dividend (cents per share) Final dividend (cents per share) Special dividend (cents per share) Dividend cover (times) R7 The Company Financial...

  • Page 5
    ... Average number of employees Seat capacity per employee (seat-km) Passenger load per employee (tonne-km) R1 Revenue per employee ($) Value added per employee ($) Employee Productivity (Average) - The Group Average number of employees Revenue per employee ($) Value added per employee ($) R1 2012/13...

  • Page 6
    ... at home. A warm welcome. It's that special feeling of sipping your favourite tea, served just the way you like it. It comes from the thought that goes into everything you taste and touch. Because we understand that there's nothing as comforting as enjoying the things you love, without having to ask...

  • Page 7

  • Page 8
    ...Officer Appointed Director on 1 October 2010 and Chief Executive Officer on 1 January 2011. Mr Goh joined the Company in 1990 and has held senior management positions in various divisions in Singapore and overseas, ranging from Marketing to Information Technology to Finance and Cargo. Prior to his...

  • Page 9
    ... Vice Chairman of the Singapore Business Federation, Advisor to Singapore Institute of International Affairs, and is a Board Member of public listed companies, The Straits Trading Company Limited, Singapore and Piramal Enterprises Limited, India. He served on the Corporate Governance Council of the...

  • Page 10
    ... corporate transformation. He was with management consulting firm McKinsey & Company for 28 years and held posts in Singapore, Toronto and Copenhagen. He is a member of the Advisory Board at the School of Business and holds Provost Chair Professorship there and at the Lee Kuan Yew School of Public...

  • Page 11
    ...Centre. Mr Wong is a member of the Board of Trustees for the Singapore Business Federation and sits on the Board of Directors of Temasek Holdings (Private) Limited, Hap Seng Plantations Holdings Berhad and Singapore Press Holdings Limited. He was a Board member of the Monetary Authority of Singapore...

  • Page 12
    ...introducing a Premium Economy Class next year, while continuing to induct new aircraft to maintain a young and modern ï¬,eet, and investing heavily in new lounge designs. Our world-leading customer service continues to improve, through a constant focus on staff training and development. An industry...

  • Page 13
    ...moving in the right direction. We are fortunate in that we have a strong balance sheet to enable us to invest with confidence, and the Board considers the financial position of the Company to be sound. Accordingly, the Board has recommended a special dividend of 25 cents per share, in addition to...

  • Page 14
    ... (from 27 July 2013) SHARE REGISTRAR M & C Services Private Limited 112 Robinson Road #05-01 Singapore 068902 Members William Fung Kwok Lun Hsieh Tsun-yan Jackson Peter Tai Gautam Banerjee (until 26 July 2013) AUDITOR Ernst & Young LLP Public Accountants and Chartered Accountants One Rafï¬,es...

  • Page 15
    ...Lee Wen Fen Senior Vice President Marketing Planning (from 1 April 2014) 31 08 MARCH Tan Pee Teck Senior Vice President Product & Services Financial Year-End Despatch of Annual Report and Circular to Shareholders Payment of Final and Special Dividends for the Financial Year 2013/14 (subject to...

  • Page 16
    ...leather, to make you feel at home. Travelling in true comfort. It starts with the finest material, handcrafted with care. It comes from experiencing an exclusive space, designed with your needs in mind. Because we understand that thoughtful innovation always needs a human touch. It's just one of the...

  • Page 17

  • Page 18
    ...-300ER on the Singapore-London route. Singapore Airlines and Tata Sons announce plan to set up a joint venture airline based in New Delhi with SIA holding 49 per cent equity and Tata Sons 51 per cent. JUNE The Airline selects the Trent 1000 engine to power the 30 Boeing 787-10s on order and signs...

  • Page 19
    ... the first time and Air New Zealand to return to the AucklandSingapore route. FEBRUARY The Airline and Airbus sign a Memorandum of Understanding to establish a ï¬,ight training joint venture in Singapore called Airbus Asia Training Centre. SIA to hold a 45 per cent equity stake and Airbus 55 per...

  • Page 20
    ... cent year-on-year. As a result, the Group's operating profit rose 13.1 per cent to $259 million in the financial year 2013/14. During the year in review, the Parent Airline Company carried 18.6 million passengers, an increase of 2.3 per cent over the previous year. Passenger carriage (in revenue...

  • Page 21
    ... other airlines offering aggressive fares while increasing capacity. Cargo yield is expected to remain weak as the air cargo industry continues to face challenges from overcapacity. Fuel prices are expected to remain at elevated levels, which presents a continuing challenge to the Group's earnings...

  • Page 22
    ...-Continent markets. With this service, Singapore Airlines now serves three Australian cities - Sydney, Melbourne and Perth - four times a day. The year also saw the cessation of non-stop services to Los Angeles and Newark, in October and November 2013 respectively. Los Angeles and New York continue...

  • Page 23
    ... at 118 as at 31 March 2014. Boeing 787-10 aircraft. Our total firm aircraft orders stood at 118 as at 31 March 2014. The Singapore Airlines passenger aircraft ï¬,eet, as at 31 March 2014, comprised 103 aircraft, with an average age of six years and nine months. SIA Cargo's ï¬,eet as at 31 March...

  • Page 24

  • Page 25

  • Page 26
    ...tickets through the Singapore Airlines website. This new payment option gives members more ï¬,exibility to use their miles. Throughout the year, KrisFlyer members also enjoyed more benefits through multiple campaigns for fare promotions, local offers and partner privileges. Since October 2013, PPS...

  • Page 27
    ANNUAL REPORT FY2013/14 a a b c Customised batik screen in the welcome foyer Signature SIA armchairs in First Class Lounge Productivity pods in Business Class Lounge b c GROUND SERVICES SilverKris Lounge Singapore Airlines introduced a new-concept SilverKris Lounge during the year in review. ...

  • Page 28
    SINGAPORE AIRLINES OPERATING REVIEW INFLIGHT SERVICES 1 Launch of Next Generation Cabin Products and KrisWorld In-Flight Entertainment System In September 2013, a new First, Business, and Economy Class cabin experience was launched on our Boeing 777300ER aircraft. Designed by DesignworksUSA (...

  • Page 29
    ANNUAL REPORT FY2013/14 2 Introduction of new Gourmet Coffee - Illy From June 2013, Singapore Airlines has introduced world-renowned illycaffè coffee in our Suites, First Class and Business Class throughout the SIA network. Based in Trieste, Italy, illycaffè produces and markets a unique blend ...

  • Page 30
    ... through new and improved training programmes on customer servicing, as well as in the various functional areas of sales and marketing, reservations and ticketing, and airport operations. For SIA cabin crew, a new partnership between Singapore Airlines and the Singapore Workforce Development Agency...

  • Page 31
    ... the Top 50 most-admired companies in the world. It is the only Singaporebased company and one of three airlines globally to be listed in this prestigious ranking. As at 31 March 2014, the staff strength of SIA Group was 23,817, an increase of 5.6 per cent over the previous year. Of this, 14,181 (59...

  • Page 32
    SIA IS COMMITTED TO SAFELY AND RELIABLY CARRYING PASSENGERS AND FREIGHT AROUND THE WORLD. WE BELIEVE THAT WE HAVE A LONG-TERM RESPONSIBILITY TO HELP PROTECT THE ENVIRONMENT.

  • Page 33
    ANNUAL REPORT FY2013/14 ENVIRONMENT SIA is committed to safely and reliably carrying passengers and freight around the world. We believe that we have a long-term responsibility to help protect the environment. As part of the Group's commitment to environmental conservation, SIA not only ensures ...

  • Page 34
    SINGAPORE AIRLINES COMMUNITY ENGAGEMENT We remain committed to contributing and investing in the communities in which we operate. During the year in review, we continued to support initiatives that promote various educational, arts, sports and heritage institutions in the form of ticket ...

  • Page 35
    ... supported numerous initiatives including the JY Pillay Global-Asia Programme, which raises local levels of research and fieldwork, as well as the Lee Kuan Yew Fund for Bilingualism, which aims to nurture a love for bilingual learning in children from young. Since August 2010, Singapore Airlines...

  • Page 36
    ...cations. In February 2014, SIAEC provided Entry-Into-Service support for SilkAir's brand new ï¬,eet of Boeing 737-800 NG aircraft. The company signed an agreement with SilkAir on a broad spectrum of maintenance, repair and overhaul (MRO) and ï¬,eet management services for the airline's 737-800 NGs...

  • Page 37
    ...various corporate social responsibility initiatives in Singapore and overseas aim to help the underprivileged gain access to better health, education and living conditions. For the company's ï¬,agship charity event "Run for Food 2013", 1,800 staff signed up for the charity run and raised a total of...

  • Page 38
    ...major exporting countries during the year in review. The International Air Transport Association reported that airfreight capacity continued to outpace demand in 2013. The focus remained on the carriage of niche and specialised types of cargo, such as express traffic, time-sensitive pharmaceuticals...

  • Page 39
    ... on the airline for "Best Air Cargo Carrier (Asia)" and "Best Green Service Provider". Air Cargo World had conferred the "Award for Excellence (Air Carrier)". As at 31 March 2014, SIA Cargo's ï¬,eet consisted of nine Boeing 747400 freighter aircraft. One aircraft was scheduled for return to lessor...

  • Page 40
    SINGAPORE AIRLINES OPERATING REVIEW SILKAIR In January 2014, SilkAir was awarded 'Regional Airline of the Year' by Airlineratings.com, an Australia-based airline safety and product rating review website. to Yogyakarta in Java commenced thereafter on 25 November 2013, increasing SilkAir's ...

  • Page 41
    ... awarded 'Regional Airline of the Year' by Airlineratings.com, an Australia-based airline safety and product rating review website. SilkAir was also ranked third in the Top 10 Airlines by Passenger Carriage in the Changi Airline Awards 2013, presented by Changi Airport Group. The airline continues...

  • Page 42

  • Page 43
    ... parallel routes. The approval could see the alignment of policies, conditions, pricing and scheduling, paving the way for seamless integration of both airlines' systems and improved connectivity for passengers. Other developments include a joint venture with Thai partner Nok Air to establish a new...

  • Page 44
    ...50 World's Most Admired Companies (Ranked 18th) FEB 2014 DestinAsian Readers' Choice Awards (9th time running) Best Airline - Overall Best Airline for Premium Class Travel (First & Business Class) Best Airline for Economy Class Best In-ï¬,ight Entertainment Best Frequent Flyer Programme - KrisFlyer...

  • Page 45
    ... Asia-Pacific Airline Best First Class Best Business Class Best Economy Class APR 2013 Travel + Leisure India & South Asia Awards (India) Best Airlines (World) 2012 Zoover.nl (Holland) Best Airline (3rd consecutive year) AUG 2013 Condé Nast Traveler (USA) 2013 Business Travel Awards Best Airline...

  • Page 46
    We find the films you love, to make you feel at home. A truly entertaining journey. There's more to it than just the latest movies. It's about finding culture and experiences from near and far, for you to enjoy. Because we understand that enriching moments make your flight just ...

  • Page 47

  • Page 48
    ...Business Units. Corresponding written assurances were provided by Group CEO and by Senior Vice President Finance to the Board Safety & Risk Committee. 2.2 2.3 2.4 2.5 3 Board Of Directors' Comments On The Practice Of Risk Management In Singapore Airlines 3.1 Having reviewed the risk management...

  • Page 49
    ... and risk management systems. This Report sets out the Company's corporate governance processes, with specific reference to the guidelines of the revised Code of Corporate Governance issued by the Ministry of Finance in Singapore in May 2012 ("the Code"). The Board's Conduct of Affairs, Board...

  • Page 50
    ...on the Company's business and strategic directions, as well as governance practices. The Company conducts orientation programmes and site visits for new Directors, and arranges for Directors to be updated on new laws and regulations, as well as changing commercial risks and industry developments, as...

  • Page 51
    ... time and attention to the affairs of the Company. The NC's terms of reference also include the responsibility for reviewing the training and professional development programmes for the Board. For FY2013/14 Board members attended briefings on the challenges facing the airline industry, as well as...

  • Page 52
    ... items such as reports on the Company and its subsidiaries and associated companies, updates on business development, monthly management accounts, and productivity and performance indicators, as well as matters for the decision or information of the Board. Directors have separate and independent...

  • Page 53
    ... of targets Financial฀&฀Business Customer฀&฀Operations People฀&฀Organisational฀Development Strategic฀Projects The PSB Payout is capped at three times of monthly base salary based on SIA Group and Company Performance in respect of the CEO and Relevant Key Management Personnel...

  • Page 54
    ... in the EBIP account are at risk because negative EVA will result in a retraction of EBIP bonus earned in preceding years. This mechanism encourages key Senior Management to work for sustainable profitability and to adopt strategies that are aligned with the long-term interests of the Group. In...

  • Page 55
    ... three calendar years from the grant date, contingent on meeting future individual strategic performance and service-based conditions. The total number of ordinary shares which may be issued pursuant to awards granted under the RSP and PSP, when added to the number of new shares issued and issuable...

  • Page 56
    ...appointed external remuneration consultant and reviewed by BCIRC. It was found that there was sufficient evidence indicating pay-for-performance alignment for the Group in both absolute and relative terms, against a peer group of large listed airline companies for the six-year period from FY2007/08...

  • Page 57
    ...1,566 134,165 Total $ 276,042 155,000 62,890 140,000 215,000 215,000 158,163 156,566 168,973 3,780,535 1,094,000 1,014,472 1,537,898 Includes EVA-based incentive plan (EBIP) payment, Profit-Sharing Bonus and Strategic Incentive Plan (SIP). The amount paid in the reporting year is a percentage of...

  • Page 58
    SINGAPORE AIRLINES CORPORATE GOVERNANCE REPORT There were no employees who were immediate family members of a Director or the CEO, and whose remuneration exceeded $50,000, during FY2013/14. Relevant Key Management Personnel4 Fee % Salary % Bonuses1 % Shares2 % Benefits3 % Total % Between $1,750,...

  • Page 59
    ... Financial Reporting The AC reviewed the quarterly and annual financial statements and financial announcements required by The Singapore Exchange Securities Trading Limited ("SGX-ST") for recommendation to the Board for approval. The review focused on changes in accounting policies and practices...

  • Page 60
    ... independent department that reports directly to the Audit Committee. The department assists the Committee and the Board by performing regular evaluations on the Group's internal controls, financial and accounting matters, compliance, business and financial risk management policies and procedures...

  • Page 61
    ANNUAL REPORT FY2013/14 Shareholder Rights and Responsibilities (Principles 14 and 15) Singapore Airlines believes in timely and consistent disclosure of pertinent information to enable a transparent assessment of the Company's value. The Company values dialogue with shareholders, and holds analyst...

  • Page 62
    ...AND ATTENDANCE OF SINGAPORE AIRLINES LIMITED BOARD OF DIRECTORS AND BOARD COMMITTEE MEMBERS For the Period 1 April 2013 to 31 March 2014 Board No. of meetings held No. of meetings attended Board Executive Committee No. of meetings held No. of meetings attended Name of Directors Stephen Lee Ching...

  • Page 63
    ANNUAL REPORT FY2013/14 Board Audit Committee No. of meetings held No. of meetings attended Board Compensation and Industrial Relations Committee No. of meetings held No. of meetings attended Board Safety and Risk Committee No. of meetings held No. of meetings attended Nominating Committee No. ...

  • Page 64
    ...Strategic Advisers Private Limited National Wages Council Title Chairman Director Director Director Director Director Member Directorships/Appointments in the past 3 years Organisation/Company 1. 2. Baosteel Group Corporation, China Chinese Development Assistance Council Title Director Board Member...

  • Page 65
    ... of Technology Date of first appointment as a director Date of last re-election as a director Board committee(s) served on: Board Executive Committee 1 October 2010 26 July 2013 Member Current Directorships in Other Listed Companies Organisation/Company 1. SIA Engineering Company Limited Title...

  • Page 66
    ... Corporation Pte Ltd Title Chairman and Senior Managing Director Vice Chairman Director Others Organisation/Company 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. Singapore International Arbitration Centre Economic Development Board EDB Investments Pte Ltd Singapore Legal Service Commission Nanyang Business...

  • Page 67
    ... director: Date of last re-election as a director: Board committee(s) served on: Board Audit Committee 1 December 2009 26 July 2012 Member Current Directorships in Other Listed Companies Organisation/Company 1. 2. 3. 4. 5. 6. 7. Li & Fung Limited Trinity Limited Convenience Retail Asia Limited Shui...

  • Page 68
    SINGAPORE AIRLINES FURTHER INFORMATION ON BOARD OF DIRECTORS HSIEH TSUN-YAN, 61 (CONTINUED) Non-executive and independent Director Current Directorships in Other Listed Companies Organisation/Company 1. 2. Bharti Airtel Limited, India Manulife Financial Corporation, Canada Title Director Director...

  • Page 69
    ... a director: Date of last re-election as a director: Board committee(s) served on: Board Safety and Risk Committee Board Compensation and Industrial Relations Committee 1 September 2009 26 July 2012 Chairman Member Current Directorships in Other Listed Companies Organisation/Company 1. 2. 3. Bayer...

  • Page 70
    ... as a director: Date of last re-election as a director: Board committee(s) served on: Board Audit Committee Board Compensation and Industrial Relations Committee 1 September 2011 26 July 2012 Member Member Current Directorships in Other Listed Companies Organisation/Company 1. 2. 3. 4. Bank...

  • Page 71
    ...on: Board Executive Committee Board Nominating Committee Board Safety and Risk Committee 1 September 2007 26 July 2013 Member Member Member Current Directorships in Other Listed Companies Organisation/Company 1. 2. Hap Seng Plantations Holdings Berhad Singapore Press Holdings Limited Title Director...

  • Page 72
    SINGAPORE AIRLINES Financial Contents 071 FINANCIAL REVIEW 087 REPORT BY THE BOARD OF DIRECTORS 100 STATEMENTS OF CHANGES IN EQUITY 106 CONSOLIDATED STATEMENT OF CASH FLOWS 108 NOTES TO THE FINANCIAL STATEMENTS 204 ADDITIONAL INFORMATION 205 QUARTERLY RESULTS OF THE GROUP 206 FIVE-YEAR FINANCIAL ...

  • Page 73
    ANNUAL REPORT FY2013/14 FINANCIAL REVIEW HIGHLIGHTS OF THE GROUP'S PERFORMANCE •฀ Total฀revenue฀$15,244฀million฀(+$146฀million,฀+1.0%) Revenue ($ million) 16,000 12,708 12,000 8,000 4,000 0 2009/10 14,525 14,858 15,098 15,244 16,000 12,000 8,000 4,000 0 2010/11 2011/12 ...

  • Page 74
    ...REVIEW Performance of the Group Key Financial Highlights ฀ 2013/14฀ 2012/13 Change Earnings For The Year ($ million) Revenue Expenditure Operating profit Profit attributable to owners of the Parent Per Share Data (cents) Earnings per share - basic Ordinary dividend per share Special dividend...

  • Page 75
    ...13 Q1 2012/13 Q2 2012/13 Q3 2012/13 Q4 2013/14 Q1 2013/14 Q2 2013/14 Q3 2013/14 Q4 90 Consequently, the Group's operating profit improved $30 million to $259 million for the financial year ended 31 March 2014. Except for Singapore Airlines ("the Company") and Singapore Airlines Cargo ("SIA Cargo...

  • Page 76
    ...). The increase in long-term investments and investment in associated companies was driven by purchase of additional shares and participation in the fund raising exercises for Virgin Australia Holdings Limited and Tiger Airways Holding Limited respectively. These were largely funded by cashï¬,ow...

  • Page 77
    ANNUAL REPORT FY2013/14 Performance of the Group (continued) Dividends For the financial year ended 31 March 2014, the Board recommends a final dividend of 11 cents per share. After considering the liquidity position of the Company, which is adequate to grow its business organically and to pursue...

  • Page 78
    ... 2013/14฀ 2012/13 Change Revenue per employee ($) Value added per employee ($) 642,769 184,268 651,093 194,040 - 1.3 5.0 Group Staff Strength and Productivity 40,000 30,000 20,000 10,000 0 2009/10 2010/11 2011/12 2012/13 2013/14 800 600 $ '000 400 200 0 Staff Number Staff Strength Revenue...

  • Page 79
    ANNUAL REPORT FY2013/14 Performance of the Group (continued) Statements of Value Added and its Distribution 2013/14 $ million 2012/13 $ million Total revenue Less: Purchase of goods and services Add: Interest income Surplus on disposal of aircraft, spares and spare engines Dividends from long-term...

  • Page 80
    SINGAPORE AIRLINES FINANCIAL REVIEW Performance of the Company Operating Performance 2013/14฀ 2012/13 Change Passengers carried (thousand) Available seat-km (million) Revenue passenger-km (million) Passenger load factor (%) Passenger yield (¢/pkm) Passenger unit cost (¢/ask) Passenger ...

  • Page 81
    ... Company's operating performance by route region is as follows: By Route Region R4 (2013/14 against 2012/13) Revenue Available Passengers Carried Passenger KM Seat KM Change฀(thousand)฀ %฀Change฀ %฀Change ฀ ฀ ฀ ฀ East Asia Americas Europe South West Pacific West Asia and Africa...

  • Page 82
    SINGAPORE AIRLINES FINANCIAL REVIEW Performance of the Company (continued) Earnings ฀ ฀ ฀ 2013/14 $฀million฀ 2012/13 $฀million฀฀ %฀ Change Revenue Expenditure Operating profit Finance charges Interest income Surplus on disposal of aircraft, spares and spare engines Dividends ...

  • Page 83
    ANNUAL REPORT FY2013/14 Performance of the Company (continued) Revenue The Company's revenue increased 0.7 per cent to $12,480 million as follows: 2013/14 $฀million฀ 2012/13 $฀million฀ Change $฀million฀ % Passenger revenue Bellyhold revenue from SIA Cargo Others Total operating ...

  • Page 84
    ...million Change Fuel costs Staff costs Depreciation R7 Handling charges Inï¬,ight meals and other passenger costs Airport and overï¬,ying charges Aircraft maintenance and overhaul costs Rentals on leased aircraft Sales costs R8 Communication and information technology costs R9 Other costs R10 Total...

  • Page 85
    ... ultra long-haul direct ï¬,ights to Americas. A change in fuel productivity (passenger aircraft) of 1.0 per cent would impact the Company's annual fuel cost by about $49 million, before accounting for changes in fuel price, USD exchange rate and ï¬,ying operations. A change in the price of fuel of...

  • Page 86
    ... Company's staff strength as at 31 March 2014 was 14,160, a decrease of 159 over last year. The distribution of employee strength by category and location is as follows: 31 March 2014฀ 2013฀ %฀฀Change Category Senior staff (administrative and higher ranking officers) Technical crew Cabin...

  • Page 87
    ... companies are SIA Engineering Company Limited ("SIAEC"), SIA Cargo and SilkAir (Singapore) Private Limited ("SilkAir"). The following performance review includes intra-group transactions. SIA Engineering Group 2013/14 $฀million฀ 2012/13 $฀million฀ %฀฀Change Total revenue Total...

  • Page 88
    ... in respect of the air cargo issues. As at 31 March 2014, SIA Cargo operated a ï¬,eet of eight B747-400 freighters. SIA Cargo's equity was $889 million (-32.1 per cent). SilkAir 2013/14 $฀million฀ 2012/13 $฀million฀ %฀฀Change Total revenue Total expenditure Operating profit Pro...

  • Page 89
    ...audited financial statements of the Group and of the Company for the financial year ended 31 March 2014. 1 Directors of the Company The names of the Directors in office at the date of this report are: Stephen Lee Ching Yen - Chairman (Independent) Goh Choon Phong - Chief Executive Officer Gautam...

  • Page 90
    SINGAPORE AIRLINES REPORT BY THE BOARD OF DIRECTORS 3฀฀ Directors'฀Interests฀in฀Shares,฀Share฀Options฀and฀Debentures฀(continued) Direct interest ฀ Name฀of฀Director฀ ฀ ฀ 1.4.2013฀ 31.3.2014฀ Deemed interest 1.4.2013฀ 31.3.2014 Conditional award of performance ...

  • Page 91
    ... dividend yields declared with ex-dividend dates occurring during the vesting period). 2. 3. Except as disclosed in this report, no other Director who held office at the end of the financial year had interests in shares, share options or debentures of the Company, or of related corporations...

  • Page 92
    ... statements. At the end of the financial year, options to take up 30,809,844 unissued shares in the Company were outstanding: Number of options to subscribe for unissued ordinary shares Date฀of฀grant฀ Balance at 1.4.2013฀ Cancelled฀ ฀Exercised฀ Balance at 31.3.2014฀ Exercise price...

  • Page 93
    ... the total number of options or awards granted under the ESOP, RSP and PSP. The details of the shares awarded under the RSP and PSP to a Director of the Company are as follows: 1. RSP Base Awards Aggregate Base Awards granted since commencement of RSP to end of financial year under review Name of...

  • Page 94
    SINGAPORE AIRLINES REPORT BY THE BOARD OF DIRECTORS 5 Equity Compensation Plans of the Company (continued) (ii) Restricted Share Plan ("RSP") and Performance Share Plan ("PSP") (continued) 3. PSP Base Awards R2 Aggregate Base Awards granted since commencement of PSP to end of financial year under...

  • Page 95
    ANNUAL REPORT FY2013/14 6 Equity Compensation Plans of SIA Engineering Company Limited (Subsidiary Company) (i) SIA Engineering Company Limited ("SIAEC") Employee Share Option Plan At the end of the financial year, options to take up 24,556,312 unissued shares in SIAEC were outstanding. Details ...

  • Page 96
    ... of Singapore Airlines Limited, do hereby state that in the opinion of the Directors: (i) the accompanying statements of financial position, consolidated profit and loss account, consolidated statement of comprehensive income, statements of changes in equity, and consolidated statement of cash...

  • Page 97
    ...of the Act and Singapore Financial Reporting Standards so as to give a true and fair view of the state of affairs of the Group and of the Company as at 31 March 2014 and of the results, changes in equity and cash ï¬,ows of the Group and the changes in equity of the Company for the year ended on that...

  • Page 98
    ... to be kept by the Company and by those subsidiaries incorporated in Singapore of which we are the auditors have been properly kept in accordance with the provisions of the Act. ERNST & YOUNG LLP Public Accountants and Chartered Accountants Singapore Dated this 8th day of May 2014 Singapore 096

  • Page 99
    ...AND LOSS ACCOUNT For The Financial Year Ended 31 March 2014 (in $ million) Notes The Group FY2013/14 FY2012/13 REVENUE EXPENDITURE Staff costs Fuel costs Depreciation Impairment of property, plant and equipment Amortisation of intangible assets Aircraft maintenance and overhaul costs Commission and...

  • Page 100
    SINGAPORE AIRLINES CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME For The Financial Year Ended 31 March 2014 (in $ million) Notes The Group FY2013/14 FY2012/13 PROFIT FOR THE FINANCIAL YEAR OTHER COMPREHENSIVE INCOME: Items that may be reclassified subsequently to profit or loss: Currency ...

  • Page 101
    .../14 STATEMENTS OF FINANCIAL POSITION As At 31 March 2014 (in $ million) The Group Notes 2014 2013 The Company 2014 2013 EQUITY ATTRIBUTABLE TO OWNERS OF THE PARENT Share capital Treasury shares Other reserves NON-CONTROLLING฀INTERESTS TOTAL EQUITY DEFERRED ACCOUNT DEFERRED TAXATION LONG-TERM...

  • Page 102
    SINGAPORE AIRLINES STATEMENTS OF CHANGES IN EQUITY For The Financial Year Ended 31 March 2014 (in $ million) The Group ฀ ฀ ฀ Notes ฀ Share capital ฀ Treasury shares ฀ Capital reserve ฀ Balance at 1 April 2013 Effects of adopting revised FRS 19 Restated balance at 1 April 2013 ...

  • Page 103
    ANNUAL REPORT FY2013/14 Attributable to Owners of the Parent Foreign currency฀฀ translation reserve Share-based฀ compensation reserve ฀ Fair value reserve General reserve ฀ Total ฀ Noncontrolling interests Total equity (191.8) (191.8) 151.7 151.7 (27.1) (27.1) 11,475.3 (15.2) 11,...

  • Page 104
    SINGAPORE AIRLINES STATEMENTS OF CHANGES IN EQUITY For The Financial Year Ended 31 March 2014 (in $ million) The Group ฀ ฀ ฀ Notes ฀ Share capital ฀ Treasury shares ฀ Capital reserve ฀ Balance at 1 April 2012 Effects of adopting revised FRS 19 Restated balance at 1 April 2012 ...

  • Page 105
    ANNUAL REPORT FY2013/14 Attributable to Owners of the Parent Foreign currency฀฀ translation reserve Share-based฀ compensation reserve ฀ Fair value reserve General reserve ฀ Total ฀ Noncontrolling interests Total equity (186.3) (186.3) 165.9 165.9 (47.6) (47.6) 11,264.6 (10.8) 11,...

  • Page 106
    SINGAPORE AIRLINES STATEMENTS OF CHANGES IN EQUITY For The Financial Year Ended 31 March 2014 (in $ million) The Company ฀ ฀ ฀ Notes ฀ Share capital Share-based Treasury Capital compensation shares reserve reserve Fair value reserve General reserve Total Balance at 1 April 2013 Effects ...

  • Page 107
    ANNUAL REPORT FY2013/14 STATEMENTS OF CHANGES IN EQUITY For The Financial Year Ended 31 March 2014 (in $ million) The Company ฀ ฀ ฀ Notes ฀ Share capital Share-based Treasury Capital compensation shares reserve reserve Fair value reserve General reserve Total Balance at 1 April 2012 ...

  • Page 108
    ... of aircraft, spares and spare engines Dividends from long-term investments Other non-operating items Share of profits of joint venture companies Share of (losses)/profits of associated companies Exceptional items Operating profit before working capital changes (Decrease)/Increase in trade...

  • Page 109
    ...of long-term investments Dividends received from associated and joint venture companies Dividends received from investments Interest received from investments and deposits Payment for purchase of derivatives Return of capital by an associated company Investments in associated companies NET CASH USED...

  • Page 110
    ... the Group and the statement of financial position and statement of changes in equity of the Company have been prepared in accordance with Singapore Financial Reporting Standards ("FRS"). The financial statements have been prepared on the historical cost basis except as disclosed in the accounting...

  • Page 111
    ... and all past service costs in profit or loss in the period they occur. The change in accounting policy has been applied retrospectively. Accordingly, the balance sheet as at 31 March 2013 has been restated. Defined benefit plans increased by $15.2 million while revenue reserves decreased by $15...

  • Page 112
    ... in the preparation of the consolidated financial statements are prepared for the same reporting date as the Company. Consistent accounting policies are applied to like transactions and events in similar circumstances. A list of the Group's subsidiary companies is shown in Note 23 to the financial...

  • Page 113
    ... unanimous consent of the parties sharing control. A list of the Group's joint venture companies is shown in Note 25 to the financial statements. The Group accounts for its investments in associated and joint venture companies using the equity method from the date on which it becomes an associated...

  • Page 114
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 2 Summary of Significant Accounting Policies (continued) (e)฀ Subsidiary,฀associated฀and฀joint฀venture฀companies฀(continued) On acquisition of the investment, any excess of the cost of the investment over the Group's ...

  • Page 115
    .... The amortisation period and method are reviewed at least annually. (ii) Deferred engine development cost This relates to the Group's share of engine development payments made in connection with its participation in aircraft engine development projects with other companies. Amortisation of such...

  • Page 116
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 2 Summary of Significant Accounting Policies (continued) (g) Foreign currencies (continued) All foreign currency monetary assets and liabilities are translated into SGD using year-end exchange rates. Nonmonetary assets and ...

  • Page 117
    ... on a straight-line basis at rates which are calculated to write down their cost to their estimated residual values at the end of their operational lives. Operational lives, residual values and depreciation method are reviewed annually in the light of experience and changing circumstances, and...

  • Page 118
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 2 ฀ Summary of Significant Accounting Policies (continued) (j)฀ Leases The determination of whether an arrangement is, or contains a lease is based on the substance of the arrangement at inception date: whether fulfillment of ...

  • Page 119
    ... price in the ordinary course of business less estimated costs necessary to make the sale. Where necessary, allowance is provided for damaged, obsolete and slow moving items to adjust the carrying value of inventories to the lower of cost and net realisable value. (l) Financial assets Financial...

  • Page 120
    ... liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. For the purpose of the consolidated statement of cash ï¬,ows, cash and cash equivalents consist of cash on hand and deposits in banks. The accounting policy...

  • Page 121
    .../14 2 Summary of Significant Accounting Policies (continued) (p)฀ Impairment฀of฀non-financial฀assets The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any such indication exists, or when annual impairment assessment for an asset is...

  • Page 122
    ...does not exceed its amortised cost at the reversal date. The amount of reversal is recognised in the profit and loss account. (ii) Financial assets carried at cost If there is objective evidence (such as significant adverse changes in the business environment where the issuer operates, probability...

  • Page 123
    ANNUAL REPORT FY2013/14 2 Summary of Significant Accounting Policies (continued) (r) Financial liabilities Financial liabilities are recognised on the statement of financial position when, and only when, the Group becomes a party to the contractual provisions of the financial instrument. The ...

  • Page 124
    ... of repairs. Provision for return costs to meet contractual return aircraft minimum conditions, at the end of the lease terms for the aircraft under operating leases, are recorded equally over the lease terms. (w) Maintenance reserve Maintenance reserve relates to payments made by the lessee for...

  • Page 125
    ... the capital reserve. Voting rights related to treasury shares are nullified for the Group and no dividends are allocated to them respectively. (z) Frequent ï¬,yer programme The Company operates a frequent ï¬,yer programme called "KrisFlyer" that provides travel awards to programme members based on...

  • Page 126
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 2 Summary of Significant Accounting Policies (continued) (aa) Taxation (continued) (ii) Deferred tax (continued) Deferred tax assets are recognised for all deductible temporary differences, carry forward of unused tax credits and ...

  • Page 127
    ... is principally earned from the carriage of passengers, cargo and mail, engineering services, training of pilots, air charters and tour wholesaling and related activities. Revenue for the Group excludes dividends from subsidiary companies and intra-group transactions. Passenger and cargo sales are...

  • Page 128
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 2 Summary of Significant Accounting Policies (continued) (ad) Employee benefits (continued) (i) Equity compensation plans (continued) This cost is recognised in the profit and loss account as share-based compensation expense, ...

  • Page 129
    ...) Training and development costs Training and development costs, including start-up programme costs, are charged to the profit and loss account in the financial year in which they are incurred. (ag) Borrowing costs Borrowing costs incurred to finance advance and progress payments for aircraft are...

  • Page 130
    ... which are independently managed by the respective segment managers responsible for the performance of the respective segments under their charge. The segment managers report directly to the Management of the Company who regularly review the segment results in order to allocate resources to the...

  • Page 131
    ... Australia is treated as a long-term investment, as opposed to an investment in an associated company. As at 31 March 2014, the Group owns 40.0% of equity in Tiger Airways Holdings Limited ("Tiger Airways"), as well as an interest in perpetual convertible capital securities acquired during the year...

  • Page 132
    ... for the financial year ended 31 March 2014. (iii) Passenger revenue recognition Passenger sales are recognised as operating revenue when the transportation is provided. The value of unused tickets is included as sales in advance of carriage on the statement of financial position and recognised as...

  • Page 133
    ...The airline operations segment provides passenger air transportation. (ii) The engineering services segment is in the business of providing airframe maintenance and overhaul services, line maintenance, technical ground handling services and ï¬,eet management programme. It also manufactures aircraft...

  • Page 134
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 4 Segment Information (in $ million) (continued) Business segments The Group's business are organised and managed separately according to the nature of the services provided. The following table presents revenue and profit ...

  • Page 135
    ANNUAL REPORT FY2013/14 Engineering services฀ FY2013/14 Cargo operations฀฀ FY2013/14 Others฀ FY2013/14 Total of segments฀฀ FY2013/14 Elimination*฀฀ FY2013/14 Consolidated FY2013/14 508.5 669.7 1,178.2 115.6 (0.2) 1.5 13.8 0.7 94.0 68.6 (23.0) 271.0 2,248.3 5.4 2,253.7 (100.4)...

  • Page 136
    ...FY2012/13 TOTAL REVENUE External revenue Inter-segment revenue RESULTS Segment result Finance charges Interest income Surplus/(Loss) on disposal of aircraft, spares and spare engines Dividends from long-term investments Other non-operating items Share of profits of joint venture companies Share of...

  • Page 137
    ANNUAL REPORT FY2013/14 Engineering services฀ FY2012/13 Cargo operations฀฀ FY2012/13 Others฀ FY2012/13 Total of segments฀฀ FY2012/13 Elimination*฀฀ FY2012/13 Consolidated FY2012/13 470.9 675.8 1,146.7 128.1 (0.1) 1.4 17.0 0.5 94.9 55.2 (22.8) 274.2 2,415.3 4.3 2,419.6 (167.0)...

  • Page 138
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 4 Segment Information (in $ million) (continued) Business segments (continued) ฀ Airline operations฀ 2014 OTHER INFORMATION AS AT 31 MARCH Segment assets Investments in associated and joint venture companies Long-term ...

  • Page 139
    ANNUAL REPORT FY2013/14 Engineering services฀ 2014 Cargo operations฀฀ 2014 Others฀ 2014 Total of segments฀฀ 2014 Elimination*฀฀ 2014 Consolidated 2014 1,256.7 435.8 14.6 1,707.1 245.9 0.2 21.8 48.7 316.6 67.9 5.9 35.7 1.3 1.7 1,567.6 17.6 63.6 1,648.8 419.8 25.4 143.2 4.8 0.9...

  • Page 140
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 4 Segment Information (in $ million) (continued) Business segments (continued) ฀ Airline operations฀ 2013 OTHER INFORMATION AS AT 31 MARCH Segment assets Investments in and loans to associated and joint venture companies Long...

  • Page 141
    ANNUAL REPORT FY2013/14 Engineering services฀ 2013 Cargo operations฀฀ 2013 Others฀ 2013 Total of segments฀฀ 2013 Elimination*฀฀ 2013 Consolidated 2013 1,191.1 427.0 14.6 1,632.7 248.4 0.2 5.7 49.2 303.5 31.8 13.7 33.2 1.7 (0.8) 1,935.3 17.6 63.6 2,016.5 253.7 24.7 208.4 4.4 ...

  • Page 142
    ... table presents revenue information on airline operations by geographical areas for the financial years ended 31 March 2014 and 2013. By area of original sale FY2013/14 FY2012/13 East Asia Europe South West Pacific Americas West Asia and Africa Systemwide Non-scheduled services and incidental...

  • Page 143
    ...was the average of the closing prices of the Company's ordinary shares on the SGX-ST for the five market days immediately preceding the date of grant. Under the Employee Share Option Scheme, options vest two years after the date of grant. Under the Senior Executive Share Option Scheme, options vest...

  • Page 144
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 5 Staff Costs (in $ million) (continued) Share-based compensation expense (continued) Share option plans (continued) Movement of share options during the financial year The following table illustrates the number and weighted ...

  • Page 145
    ANNUAL REPORT FY2013/14 5 Staff Costs (in $ million) (continued) Share-based compensation expense (continued) Share option plans (continued) Exercisable period Exercise price Number outstanding and exercisable 2.7.2008 - 1.7.2017 2.7.2009 - 1.7.2017 2.7.2010 - 1.7.2017 2.7.2011 - 1.7.2017 1.7....

  • Page 146
    ...฀ Cost PSP Award of fully-paid ordinary shares of the Company, conditional on performance targets set at the start of a three-year overlapping performance period based on stretched long-term corporate objectives. •฀ Absolute฀Total฀Shareholder฀ Return (TSR) outperform Cost of Equity...

  • Page 147
    ANNUAL REPORT FY2013/14 5 Staff Costs (in $ million) (continued) Share-based compensation expense (continued) Share-based฀incentive฀plans฀(continued) Movement of share awards during the financial year Number of Restricted Shares ฀ ฀ Date฀of฀grant Balance at 1.4.2013/฀ date฀of...

  • Page 148
    ... table lists the key inputs to the model used for the July 2013 and July 2012 awards: July 2013 Award RSP PSP July 2012 Award RSP PSP Expected dividend yield (%) Expected volatility (%) Risk-free interest rate (%) Expected term (years) Share price at date of grant ($) Management's forecast in line...

  • Page 149
    ... one year after the retirement date. For employees still in service, 50% of the shares will vest in 2013 and the balance will vest equally in 2014 and 2015. The fair value of the time-based share awards is the market price of the shares at the date of grant discounted by the expected future dividend...

  • Page 150
    ... FINANCIAL STATEMENTS 31 March 2014 6 Operating Profit (in $ million) Operating profit for the financial year was arrived at after charging/(crediting): The Group FY2013/14 FY2012/13 Compensation for changes in aircraft delivery slots Interest income from short-term investments Dividend income...

  • Page 151
    ...by Singapore Airlines Cargo 371.5 (293.4) (29.4) (87.0) (38.3) (19.9) (19.9) During the financial year, the Company completed the sale of its 49% stake in Virgin Atlantic Limited for a consideration of USD361.0 million ($455.3 million). Under the equity method, the Group has previously accounted...

  • Page 152
    ... expense and the product of accounting profit multiplied by the applicable tax rate for the years ended 31 March is as follows: The Group FY2013/14 FY2012/13 Profit before taxation Less: Share of profits of associated and joint venture companies Taxation at statutory corporate tax rate of 17...

  • Page 153
    ...) respectively be paid for the financial year ended 31 March 2014. 14 Share Capital (in $ million) The Group and the Company Number of shares Amount 2014 2013 2014 2013 Issued and fully paid share capital Ordinary shares Balance at 1 April and 31 March Special share Balance at 1 April and 31 March...

  • Page 154
    ... 15 Treasury Shares (in $ million) The Group and the Company 31 March 2014 2013 Balance at 1 April Purchase of treasury shares Treasury shares reissued pursuant to equity compensation plans: - For cash on exercise of employee share options - Transferred from share-based compensation reserve - (Gain...

  • Page 155
    ... that of the Group's presentation currency. (c)฀ Share-based฀compensation฀reserve Share-based compensation reserve represents the equity-settled share options and awards granted to employees. The reserve is made up of the cumulative value of services received from employees recorded on grant...

  • Page 156
    ...retained earnings of the Group and the Company. Movements in the Group's and the Company's general reserves are set out in the Statement of Changes in Equity respectively. 17 Deferred Account (in $ million) The Group 31 March 2014 2013 The Company 31 March 2014 2013 Deferred gain/(loss) on sale and...

  • Page 157
    ANNUAL REPORT FY2013/14 18 Deferred Taxation (in $ million) The Group Statement of financial position Profit and loss 31 March 2014 2013 FY2013/14 FY2012/13 The Company Statement of financial position 31 March 2014 2013 The deferred taxation arises as a result of: Deferred tax liabilities ...

  • Page 158
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 19฀ Long-Term฀Liabilities฀(in฀$฀million) The Group 31 March 2014 2013 The Company 31 March 2014 2013 Notes payable Non-current Loans Current Non-current Finance lease commitments Current Non-current Maintenance reserve ...

  • Page 159
    ... aircraft and lease end liability. It is expected that the return costs will be incurred by the end of the lease terms. An analysis of the provisions is as follows: The Group 31 March 2014 2013 The Company 31 March 2014 2013 Balance at 1 April Provision during the year Provision utilised during...

  • Page 160
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 21฀ Property,฀Plant฀and฀Equipment฀(in฀$฀million) The Group Aircraft spares Aircraft spare engines Aircraft Cost At 1 April 2012 Additions Transfers Disposals Exchange differences At 31 March 2013 Additions Transfers ...

  • Page 161
    ANNUAL REPORT FY2013/14 Freehold land Freehold buildings Leasehold land and buildings Plant and equipment Office and computer equipment Advance and progress payments Total 15.7 15.7 15.7 148.7 (0.3) 148.4 (1.0) 147.4 617.6 0.6 8.9 (0.2) 626.9 0.5 3.6 (9.4) 0.3 621.9 724.4 11.6 84.8 (33...

  • Page 162
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 21฀ Property,฀Plant฀and฀Equipment฀(in฀$฀million)฀(continued) The Company Aircraft spares Aircraft spare engines Aircraft Cost At 1 April 2012 Additions Transfers Disposals At 31 March 2013 Additions Transfers ...

  • Page 163
    ANNUAL REPORT FY2013/14 Freehold land Freehold buildings Leasehold land and buildings Plant and equipment Office and computer equipment Advance and progress payments Total 15.7 15.7 15.7 148.7 (0.3) 148.4 (1.0) 147.4 341.7 341.7 (9.4) 332.3 392.2 0.6 80.6 (15.3) 458.1 8.0 27.1 (2.2) 491...

  • Page 164
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 21฀ Property,฀Plant฀and฀Equipment฀(in฀$฀million)฀(continued) Assets held under finance leases The Group 31 March 2014 2013 Net book value of property, plant and equipment acquired under finance leases: - aircraft ...

  • Page 165
    ... software and others Deferred engine development cost Advance and progress payments Total Accumulated amortisation At 1 April 2012 Amortisation Disposals At 31 March 2013 Amortisation Disposals At 31 March 2014 Net book value At 31 March 2013 At 31 March 2014 The Company 327.0 22.7 (8.6) 341.1 25...

  • Page 166
    ... - Number of engines represent the projected number of aircraft engines expected to be sold upon completion of the engine development. Projected engine sale is based on current aircraft orders and expectation of the market development. A reasonable change to the assumptions used by Management to...

  • Page 167
    ... Singapore Philippines Singapore 78.0 78.0 78.0 78.6 78.6 78.6 Investment holding Provide aircraft maintenance services, including technical and non-technical handling at the airport Investment holding Provide airframe maintenance and component overhaul services Manufacturing aircraft cabin...

  • Page 168
    ... Held by Singapore Airlines Cargo (4) Held by SilkAir (Singapore) Private Limited (5) Held by the Company (56%) and SilkAir (Singapore) Private Limited (5%) * Audited by member firms of Ernst & Young Global in the respective countries ** Audited by Shanghai Hui Hong Certified Public Accountants Co...

  • Page 169
    ... has NCI that are material to the Group: SIA Engineering Company Group of Companies 2014 2013 Proportion of ownership interest held by NCI Profit allocated to NCI during the reporting period Accumulated NCI at the end of reporting period Dividends paid to NCI (c) Summarised financial information...

  • Page 170
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 24 Associated Companies (in $ million) The Group 31 March 2014 2013 Share of net assets of associated companies at acquisition date Goodwill on acquisition of associated companies Accumulated impairment loss Goodwill written off to...

  • Page 171
    ... of business Percentage of equity held by the Group 2014 2013 Principal activities Tiger Airways Holdings Limited@ RCMS Properties Private Limited^++ Component Aerospace Singapore Pte Ltd (previously known as Combustor Airmotive Services Pte Ltd)^+++ Eagle Services Asia Private Limited(1)^++ Fuel...

  • Page 172
    ... overhaul of aircraft engine turbine airfoils Domestic and international full service scheduled passenger airlines services Under liquidation Air transportation - do - 26.0 26.2 Taiwan Singapore India 19.1 19.1 49.0 19.3 19.3 - Great Wall Airlines Company Limited(3)#++ Virgin Atlantic Limited...

  • Page 173
    ANNUAL REPORT FY2013/14 24 Associated Companies (in $ million) (continued) The carrying amounts of the investment in associated companies are as follows: The Group 31 March 2014 2013 Tiger Airways Holdings Limited ("Tiger Airways") Eagle Services Asia Private Limited ("ESA") Other associated ...

  • Page 174
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 24 Associated Companies (in $ million) (continued) A reconciliation of the summarised financial information to the carrying amounts of Tiger Airways and ESA are as follows: The Group 31 March 2014 2013 Tiger Airways Group's share ...

  • Page 175
    ANNUAL REPORT FY2013/14 25 Joint Venture Companies (in $ million) The Group 31 March 2014 2013 Investment in joint venture companies (unquoted, at cost) Share of post-acquisition reserves - general reserve - foreign currency translation reserve 56.6 94.5 (24.6) 126.5 56.6 90.0 (25.8) 120.8 The ...

  • Page 176
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 25 Joint Venture Companies (in $ million) (continued) The summarised financial information in respect of SAESL, which is material to the Group, is as follows: Summarised balance sheet SAESL 31 March 2014 2013 Cash and short-term ...

  • Page 177
    ANNUAL REPORT FY2013/14 25 Joint Venture Companies (in $ million) (continued) A reconciliation of the summarised financial information to the carrying amount of SAESL is as follows: The Group 31 March 2014 2013 Group's share of net assets 115.1 108.3 Aggregate information about the Group's ...

  • Page 178
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 26฀ Long-Term฀Investments฀(in฀$฀million)฀ The Group 31 March 2014 2013 The Company 31 March 2014 2013 Available-for-sale investments Quoted Government securities Equity investments Unquoted Non-equity investments Equity...

  • Page 179
    ANNUAL REPORT FY2013/14 29 Trade Debtors (in $ million) The Group 31 March 2014 2013 The Company 31 March 2014 2013 Trade debtors Accrued receivables Amount owing from associated companies Amount owing from joint venture companies Amounts owing from subsidiary companies 1,514.8 62.6 24.6 2.7 1,...

  • Page 180
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 29 Trade Debtors (in $ million) (continued) Trade debtors are stated after accumulated impairment losses. An analysis of the accumulated impairment losses is as follows: The Group 31 March 2014 2013 The Company 31 March 2014 2013 ...

  • Page 181
    ...05% to 5.88%) per annum, while unquoted non-equity investments yield an interest rate of 2.28% to 2.30% (FY2012/13: 1.15%) per annum. 32 Cash and Bank Balances (in $ million) The Group 31 March 2014 2013 The Company 31 March 2014 2013 Fixed deposits Cash and bank 4,309.1 574.8 4,883.9 4,692.4 367...

  • Page 182
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 33 Trade and Other Creditors (in $ million) The Group 31 March 2014 2013 The Company 31 March 2014 2013 Trade creditors Amounts owing to associated companies Funds from subsidiary companies Amounts owing to subsidiary companies 2,...

  • Page 183
    ... to purchase the related aircraft. Sub-leasing is allowed under all the lease arrangements. Future minimum lease payments under non-cancellable operating leases are as follows: The Group 31 March 2014 2013 The Company 31 March 2014 2013 Not later than one year Later than one year but not later than...

  • Page 184
    ... rates. The basic lease term for each engine varies from one to six years with extension options. During the financial year, two leases ceased on expiry of the leased term. Future minimum lease payments under non-cancellable operating leases are as follows: The Group 31 March 2014 2013 The Company...

  • Page 185
    ...Zealand, South Africa, South Korea and Switzerland as to whether surcharges, rates or other competitive aspects of air cargo service were lawfully determined (the "air cargo issues"). On 8 February 2011, SIA Cargo confirmed its acceptance of a plea bargain offered by the United States Department of...

  • Page 186
    ..., in 2012 and 2013, SIA Cargo reached settlements with certain of its customers to resolve all pending and potential future civil damage claims regarding the air cargo issues. The settlements have been reï¬,ected in the Group's accounts in the financial year and the previous financial year. The...

  • Page 187
    ..., India, principally against the Ministry of Civil Aviation and the Directorate General of Civil Aviation ("DGCA"), the Company, SilkAir and other airlines. The proceedings sought to quash a DGCA order dated 28 July 2011 which stated that the payment of commission to designated agents by airlines is...

  • Page 188
    ...) 2014 The Company Available-for-฀ Loans and sale financial receivables assets Held-to-฀ ฀ Financial฀ maturity฀฀ Derivatives฀ liabilities฀at฀ financial used for amortised assets hedging cost ฀ ฀ Total Assets Long-term investments Other receivables Trade debtors Deposits...

  • Page 189
    ... Financial฀ at฀fair฀value ฀ Available-for-฀ maturity฀฀ Derivatives฀ liabilities฀at฀ through Loans and sale financial financial used for amortised profit or receivables assets assets hedging cost loss Total Assets Long-term investments Other receivables Trade debtors Deposits...

  • Page 190
    ...) 2013 The Company Available-for-฀ Loans and sale financial receivables assets Held-to-฀ ฀ Financial฀ maturity฀฀ Derivatives฀ liabilities฀at฀ financial used for amortised assets hedging cost ฀ ฀ Total Assets Long-term investments Other receivables Trade debtors Deposits...

  • Page 191
    ... values Financial instruments carried at fair value Fair value hierarchy The following table shows an analysis of financial instruments carried at fair value by level of fair value hierarchy: The Group 31 March 2014 Quoted prices in active markets for identical instruments (Level 1) 31 March 2013...

  • Page 192
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 37 Financial Instruments (in $ million) (continued) (b) Fair values (continued) Financial instruments carried at fair value (continued) Determination of fair value The Group and the Company have carried all investment securities ...

  • Page 193
    ... non-performance by a counterparty is considered to be unlikely. Financial risk management policies are periodically reviewed and approved by the Board Executive Committee ("BEC"). (a) Jet fuel price risk The Group's earnings are affected by changes in the price of jet fuel. The Group's strategy for...

  • Page 194
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 38฀ Financial฀Risk฀Management฀Objectives฀and฀Policies฀(in฀$฀million)฀(continued) (a) Jet fuel price risk (continued) Jet fuel price sensitivity analysis The jet fuel price risk sensitivity analysis is based on ...

  • Page 195
    ANNUAL REPORT FY2013/14 38฀ Financial฀Risk฀Management฀Objectives฀and฀Policies฀(in฀$฀million)฀(continued) (b) Foreign currency risk (continued) Fair value through profit or loss In addition, the Group has cross currency swap contracts in place with notional amounts ranging from ...

  • Page 196
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 38฀ Financial฀Risk฀Management฀Objectives฀and฀Policies฀(in฀$฀million)฀(continued) (c) Interest rate risk The Group's earnings are also affected by changes in interest rates due to the impact such changes have on ...

  • Page 197
    ANNUAL REPORT FY2013/14 38฀ Financial฀Risk฀Management฀Objectives฀and฀Policies฀(in฀$฀million)฀(continued) (c) Interest rate risk (continued) Interest rate sensitivity analysis (continued) Under these assumptions, an increase or decrease in market interest rates of one basis point...

  • Page 198
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 38฀ Financial฀Risk฀Management฀Objectives฀and฀Policies฀(in฀$฀million)฀(continued) (d) Market rate risk At 31 March 2014, the Group and the Company own investments of $1,313.7 million (2013: $957.4 million) and $1,...

  • Page 199
    ANNUAL REPORT FY2013/14 38฀ Financial฀Risk฀Management฀Objectives฀and฀Policies฀(in฀$฀million)฀(continued) (e) Liquidity risk (continued) ฀ ฀ 2014 ฀ Within฀1฀ year 1฀-฀2฀ years 2฀-฀3฀ years 3฀-฀4฀ years 4฀-฀5฀ years More than 5 years Total The ...

  • Page 200
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 38฀ Financial฀Risk฀Management฀Objectives฀and฀Policies฀(in฀$฀million)฀(continued) (f) Credit risk The Group has an independent Group Debts Review Committee to review the follow up actions on outstanding ...

  • Page 201
    ANNUAL REPORT FY2013/14 38฀ Financial฀Risk฀Management฀Objectives฀and฀Policies฀(in฀$฀million)฀(continued) (g) Counterparty risk (continued) The Group determines concentrations of credit risk by monitoring the industry, country and credit rating of its counterparties. The table ...

  • Page 202
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 39 Capital Management (in $ million) The primary objective of the management of the Company's capital structure is to maintain an efficient mix of debt and equity in order to achieve a low cost of capital, while taking into account...

  • Page 203
    ... member Directors' and key executives' remuneration of the Group 39.7 (76.0) 0.1 (15.1) 1,215.8 0.8 37.3 (85.2) 0.4 (14.8) 1,013.5 0.2 The Group FY2013/14 FY2012/13 Directors Salary, bonuses, fee and other costs CPF and other defined contributions Share-based compensation expense Key executives...

  • Page 204
    SINGAPORE AIRLINES NOTES TO THE FINANCIAL STATEMENTS 31 March 2014 40 Related Party Transactions (in $ million) (continued) Conditional awards granted to Director and key executives of the Company pursuant to the Restricted Share Plan and the Performance Share Plan are as follows: RSP Base Awards ...

  • Page 205
    ... medium term note programme. The notes will mature on 8 April 2021 and 8 April 2024 respectively. On 8 May 2014, the Company agreed to subscribe to 400 million shares of Scoot Pte. Ltd. at a price of $1 per share, to support Scoot's investment in its new ï¬,eet of 787 aircraft. The subscription date...

  • Page 206
    ... Pte Ltd and Aranda Investments Pte Ltd (subsidiaries of Temasek Holdings (Private) Limited) to acquire 72,334,350 ordinary shares of Tiger Airways Holdings Ltd ("TAH"). Sector rate agreement between Scoot Pte Ltd and Tiger Airways Singapore Pte Ltd ("Tiger") which applies to tickets issued by Scoot...

  • Page 207
    ANNUAL REPORT FY2013/14 QUARTERLY RESULTS OF THE GROUP 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Total TOTAL REVENUE 2013/14 2012/13 ($ million) ($ million) 3,840.2 3,777.4 3,900.7 3,793.6 3,874.6 3,860.4 3,628.4 3,666.8 15,243.9 15,098.2 TOTAL EXPENDITURE 2013/14 2012/13 ($ million) ($ ...

  • Page 208
    ...FIVE-YEAR FINANCIAL SUMMARY OF THE GROUP 2013/14 2012/13 2011/12 2010/11 2009/10 PROFIT AND LOSS ACCOUNT ($ million) Total revenue Total expenditure Operating profit Finance charges Interest income Surplus/(Loss) on disposal of aircraft, spares and spare engines Dividend from long-term investments...

  • Page 209
    ...) Cash earnings ($) R2 Net asset value ($) SHARE PRICE ($) High Low Closing DIVIDENDS Gross dividends (cents per share) Dividend cover (times) PROFITABILITY฀RATIOS฀(%) Return on equity holders' funds R5 Return on total assets R6 Return on turnover R7 PRODUCTIVITY AND EMPLOYEE DATA Value added...

  • Page 210
    ... venture companies, and additional long-term equity investments. Seat capacity per employee is available seat capacity divided by Singapore Airlines' average staff strength. Passenger load carried per employee is defined as passenger load and excess baggage carried divided by Singapore Airlines...

  • Page 211
    ...years (y) and months (m) Aircraft type Finance Owned Lease Operating Lease Total Seats in standard configuration Expiry of operating lease 2014/15 2015/16 On firm order On option Singapore Airlines: B777-200A B777-200R B777-200ER B777-200ERR R1 B777-300R B777-300ER A380-800 A380-800A A330...

  • Page 212
    ... CORPORATE STRUCTURE 31 March 2014 SINGAPORE AIRLINES LIMITED 78.0% SIA Engineering Company Limited 100% SilkAir (Singapore) Private Limited 56% Abacus Travel Systems Pte Ltd 100% Tradewinds Tours & Travel Private Limited Abacus Travel Systems Pte Ltd 100% Aircraft Maintenance Services Australia...

  • Page 213
    ANNUAL REPORT FY2013/14 INFORMATION ON SHAREHOLDINGS as at 3 June 2014 No. of Issued Shares: No. of Issued Shares (excluding Treasury Shares): No./Percentage of Treasury Shares: Class of Shares: Voting Rights (excluding Treasury shares): Range of shareholdings ฀ 1,199,851,019 1,174,791,796 25,...

  • Page 214
    ... ON SHAREHOLDINGS as at 3 June 2014 Twenty largest shareholders ฀ Name฀ Number฀of฀shares฀ %*฀ 1 2 3 4 5 6 7 8 9 Temasek Holdings (Private) Limited DBS Nominees Pte Ltd Citibank Nominees Singapore Pte Ltd DBSN Services Pte Ltd HSBC (Singapore) Nominees Pte Ltd United Overseas Bank...

  • Page 215
    ...Closing Price ST Index Share Price ($) 2013/14 2012/13 High Low Closing Market Value Ratios R1 11.45 9.44 10.47 11.35 10.10 10.87 Price/Earnings Price/Book value Price/Cash earnings R2 R1 R2 34.22 0.93 6.23 33.76 0.98 6.39 Based on closing price on 31 March and Group numbers. Cash earnings...

  • Page 216
    ... to transact the following business: Ordinary Business 1. To receive and adopt the Directors' Report and Audited Financial Statements for the year ended 31 March 2014 and the Auditor's Report thereon. To declare a final dividend of 11 cents per ordinary share and a special dividend of 25 cents per...

  • Page 217
    ...per cent of the total number of issued shares (excluding treasury shares) in the capital of the Company (as calculated in accordance with sub-paragraph (2) below); (2) (subject to such manner of calculation as may be prescribed by the Singapore Exchange Securities Trading Limited ("SGX-ST")) for the...

  • Page 218
    ... of Members of the Company will be closed on 6 August 2014 for the preparation of dividend warrants. Duly completed and stamped transfers (together with all relevant documents of or evidencing title) received by the Share Registrar, M & C Services Private Limited, 112 Robinson Road #05-01, Singapore...

  • Page 219
    ... cent sub-limit allowed under the Listing Manual of the Singapore Exchange Securities Trading Limited. For the purpose of determining the aggregate number of shares which may be issued, the percentage of issued shares shall be based on the total number of issued shares (excluding treasury shares) in...

  • Page 220
    Registered Address Airline House, 25 Airline Road Singapore 819829 Company Secretary Ethel Tan Tel: 6541 4030 Fax: 6546 7469 Email: [email protected] Investor Relations Tel: 6541 4885 Fax: 6542 9605 Email: [email protected] Public Affairs Tel: 6541 5880 Fax: 6545 ...