Tag Archives: Singapore Airlines

Singapore Airlines secures S$10 Billion in fresh liquidity

Singapore Airlines (SIA) has announced the Company has raised S$10 billion of liquidity through its recent Rights Issue, as well as a mix of secured and unsecured credit facilities. This puts SIA on a steady footing as it tackles the challenges posed by the global Covid-19 outbreak.

SIA secured S$8.8 billion in liquidity through the successful completion of the rights issue on June 5, 2020. A further S$900 million was raised through long term loans secured on some of SIA’s Airbus A350-900 and Boeing 787-10 aircraft.

In addition, the Company has also arranged new committed lines of credit and a short term unsecured loan with several banks, which provide further fresh liquidity amounting to more than S$500 million.

Separately, all existing committed lines of credit that were due to mature during the course of 2020 have been renewed until 2021 or later, thus ensuring continued access to more than S$1.7 billion in liquidity.

During this period of high uncertainty, SIA will continue to explore additional means to shore up liquidity as necessary. For the period up to July 2021, the Company also retains the option to raise up to a further S$6.2 billion in additional mandatory convertible bonds, which will provide additional liquidity if necessary.

Singapore Airlines Chief Executive Goh Choon Phong said. “We are grateful for the strong support of our shareholders for our successful rights issue, which has secured the company’s future amid an unprecedented global health and economic crisis. We are also grateful to our relationship banks for their support in extending additional secured and unsecured loans, as well as committed lines of credit. SIA will remain steadfast and agile during this period of great uncertainty, and continue to act nimbly in responding to the evolving market conditions.”

Singapore Airlines secures funding to survive the coronavirus crisis

Singapore Airlines has announced it has secured up to S$19 billion ($13 billion) of funding to help see it through the coronavirus crisis and expand after the crisis.

Read more from Reuters.

Singapore Airlines aircraft photo gallery:

Singapore Airlines Group cuts 96% of its capacity and grounds 185 aircraft

Singapore Airlines has made this announcement:

Singapore Airlines will be cutting 96% of the capacity that had been originally scheduled up to end-April, given the further tightening of border controls around the world over the last week to stem the Covid-19 outbreak.


This will result in the grounding of around 138 SIA and SilkAir aircraft, out of a total fleet of 147, amid the greatest challenge that the SIA Group has faced in its existence.


The Group’s low-cost unit Scoot will also suspend most of its network, resulting in the grounding of 47 of its fleet of 49 aircraft.

The SIA Group diversified its network and set up Scoot to spread its risks and cater to a wide range of passenger and market segments. However, without a domestic segment, the Group’s airlines become more vulnerable when international markets increasingly restrict the free movement of people or ban air travel altogether.

It is unclear when the SIA Group can begin to resume normal services, given the uncertainty as to when the stringent border controls will be lifted.

The resultant collapse in the demand for air travel has led to a significant decline in SIA’s passenger revenues.

The Company is actively taking steps to build up its liquidity, and to reduce capital expenditure and operating costs. As mentioned on March 17, 2020, SIA will continue to aggressively pursue all measures to address the impact of the Covid-19 outbreak on the Company. These include:

• ongoing discussions with aircraft manufacturers to defer upcoming aircraft deliveries. If agreed, this will consequently defer payment for those aircraft deliveries;

• salary cuts for the SIA Group’s management with the Company’s Directors also agreeing to a cut in their fees, and a voluntary no-pay leave scheme up to certain management positions. Given the worsening situation, the unions have been engaged on the additional cost-cutting measures that are needed and more steps will

be taken imminently; and

• over the last few days, the SIA Group has drawn on its lines of credits to meet its immediate cash flow requirements. The SIA Group is engaging in discussions with several financial institutions for its future funding requirements.

The Company continues to explore measures to shore up its liquidity during this unprecedented disruption to global air travel. The Company will release further details when such measures have been firmed up.

Singapore Airlines aircraft photo gallery:

SilkAir aircraft photo gallery:

Scoot aircraft photo gallery:

Singapore Airlines and SilkAir to reduce services due to Covid-19 outbreak

Singapore Airlines and SilkAir will temporarily reduce services across our network due to weak demand as a result of the Covid-19 outbreak.

Details of the affected flights can be found here.

We will continue to monitor the situation and make further adjustments as necessary.

Singapore Airlines aircraft photo gallery:

The return of the Singapore Airlines Boeing 737

Singapore Airlines was an early adopter of the Boeing 737, operating the initial 737-100 model. Singapore operated 5 of the type which it inherited from MSA – Malaysia-Singapore Airlines.

As previously reported, Singapore Airlines has announce it will fold subsidiary SilkAir into Singapore Airlines including its 17 Boeing 737-800s and six grounded MAX 8s.

SilkAir is currently transitioning to an all-737 fleet,

Now the first Singapore Boeing 737 MAX 8 (9V-MBN, msn 44258) has been painted by Boeing pending re-certification and delivery.

Copyright Photo: Joe G. Walker.

Singapore Airlines reports higher first half net profit of $206 million

  •   Net profit for the second quarter rose 68 per cent to $94 million
  •   Strong passenger traffic growth continues to support operating performance
  •   Cargo demand remains weak amid trade uncertainties
  •   Vistara accelerates expansion and commences international operations 

    GROUP FINANCIAL PERFORMANCE First Half 2019/20

    The SIA Group achieved a net profit of $206 million in the first half of the financial year, $10 million (+5.1%) higher than last year.

    Revenue rose $418 million (+5.3%), primarily from strong growth in passenger flown revenue, partially offset by a reduction in cargo flown revenue, while higher expenditure (+$431 million or 5.8%) reflected enlarged operations. Accordingly, operating profit for the Group was $413 million, down $13 million or 3.1% compared to the same period last year.

    The Group recorded a reduction in share of losses from associated companies (+$36 million), mostly from Virgin Australia, and a higher share of profits from joint venture companies (+$19 million). These were offset by increased net finance charges (-$54 million) due to the recognition of interest expense arising from lease liabilities following the adoption of IFRS 16 Leases and additional financing for fleet renewal and expansion.

 

SilkAir continues to be adversely affected by the global grounding of the Boeing 737 MAX 8 aircraft, clocking an operating deficit of $19 million for the period.

Notwithstanding a reduction in capacity (-1.1%) from route transfers to Scoot and the withdrawal of the 737 MAX 8s from service, the carrier achieved passenger flown revenue growth of $4 million (+0.9%). Passenger load factor rose on the back of a 2.8% increase in traffic, driving a 1.2% improvement in RASK. However, this was negated by lower non-scheduled services revenue and incidental revenue, leading to a $6 million decline in operating revenue. Expenditure was up $10 million, partially attributable to 737 MAX 8 related costs, along with higher net fuel cost.

Total revenue for Scoot improved $7 million, driven by passenger flown revenue growth of $29 million as capacity expansion (+5.6%) was matched by higher passenger traffic (+5.8%). However, passenger revenue improvements were tempered by weaker RASK (-2.1%) on lower yields, declines in cargo revenue (-$4 million or 13.0%) and other operating revenue (-$18 million). Expenditure rose $74 million (+8.5%), mainly a result of higher depreciation from a larger fleet. In addition, Scoot continued to proactively reduce aircraft utilisation during the period to improve operational resilience. As a result, the carrier recorded an operating loss of $77 million, a deterioration of $67 million year-on-year.

Second Quarter 2019/20

Group net profit for the second quarter rose $38 million (+67.9%) to $94 million, mainly attributable to improvement in share of results from associates and joint ventures (+$78 million), partially offset by higher net finance charges (-$28 million) for the quarter.

Operating profit for the second quarter contracted $20 million (-8.6%) to $213 million, as expenditure increased $180 million (+4.7%), mainly from capacity injection, outweighing revenue growth of $160 million (+3.9%). Passenger revenue grew $244 million (+7.5%), while cargo revenue declined $93 million (-16.3%). Ex-fuel cost rose $160 million (+6.0%), following a 6.2% increase in capacity, while net fuel costs were $20 million (+1.7%) higher.

ROUTE DEVELOPMENT

 

During the quarter, the Parent Airline Company began operations of its inaugural Seattle services on 3 September 2019, its fourth non-stop service to the US, following the successful launch of Newark flights a year ago. In addition, Busan services launched by SilkAir in May, were taken over by SIA from 28 October 2019, boosting seat capacity to cater to growing demand. Seasonal services to Sapporo will also be operated from 30 November 2019 to 6 January 2020. As at 30 September 2019, SIA served 65 destinations, including Singapore.

SilkAir continues to see network changes as part of the planned merger with SIA, completing the transfer of Chiang Mai, Coimbatore and Visakhapatnam operations to Scoot in October. It is also on track to transfer Kota Kinabalu in December 2019, subject to regulatory approvals. Conversely, SilkAir took over Kochi services from Scoot from 27 October 2019, adding four more services to its existing 10 non-stop flights a week. As at 30 September 2019, SilkAir served 43 destinations, including Singapore.

Following the commencement of Fuzhou and Kota Bharu services in July 2019, Scoot added two new destinations in India, Coimbatore and Visakhapatnam, to its network from 27 October 2019. Scoot also suspended services to Quanzhou and Male, along with adjusting Harbin flight frequency to a Northern Winter (October to March) only seasonal service, to better match demand and capacity. Seasonal frequency additions will also be made for Melbourne, Perth, Phuket and Sydney during the Northern Winter peak period. Scoot ended the quarter with 67 destinations, including Singapore.

Overall, the portfolio of airlines in the Group served 137 passenger destinations in 37 countries and territories, including Singapore, as at 30 September 2019.

Following the launch of Vistara’s first international route, to Singapore in August 2019, SIA and SilkAir signed an agreement with Vistara to expand codesharing to international destinations, subject to regulatory approvals. Vistara increased its fleet from 22 to 32 aircraft during the first half of the financial year, and commenced international operations to Singapore, Dubai and Bangkok. Vistara is set to continue rapid fleet growth in the second half as it takes delivery of new A320neo and A321neo aircraft, and inducts its first two widebody aircraft (787-9). As a result, it will almost double its fleet size during the financial year. This will allow Vistara to quickly increase its domestic and international networks and, importantly, to commence medium to long haul international operations in 2020.

OUTLOOK

Passenger bookings in the coming months are expected to be stronger year-on-year, with yields supported by premium cabin traffic. However, headwinds persist in the form of intensifying competition in key operating markets, as well as an uncertain global economic outlook. Cargo demand is likely to remain weaker year-on- year, despite the seasonal peak, amid ongoing trade tensions and a manufacturing slowdown in key export economies.

Fuel prices are expected to remain volatile, as a result of geopolitical and economic risks. For the second half of the financial year, the Group has hedged 75% of its fuel requirements in MOPS and 3% in Brent at weighted average prices of USD76 and USD54 per barrel respectively [Note 2]. The Group will continue to enter into longer-dated hedges extending to FY2024/25.

As it enters the final lap of its three-year Transformation programme, the SIA Group remains committed to enhancing customer experience, improving operational efficiency and boosting revenue by strengthening digital capabilities. The recent expansion of the KrisConnect programme is one significant milestone. Utilising technology enablers such as NDC (New Distribution Capability), and APIs (Application Program Interface), KrisConnect facilitates integration and exchange of content between the Group and its partners, enabling customers to access personalised offerings across more distribution channels in addition to traditional owned channels.

KrisShop, the airline’s flagship travel retailer, has been restructured to become a premium omni-channel e-commerce retailer. It will continue to expand its range of products and services through its themed concept stores and official brand stores on the new website. Optimised by advanced technological and logistics capabilities, KrisShop has introduced multiple consumer-centric initiatives for convenient payment, pre-order and delivery services. Additionally, the new SIA mobile app, designed for faster performance and improved usability to give customers a seamless and more personalised experience, was launched in August 2019. These initiatives are testament to the Group’s aggressive digital transformation efforts.

Delivered on April 1, 2017

Above Copyright Photo: Singapore Airlines Airbus A350-941 9V-SML (msn 096) AMS (Antony J. Best). Image: 938574.

Singapore Airlines aircraft slide show:

Malaysia Airlines and Singapore Airlines sign wide-ranging partnership agreement

The two airlines issued this statement:

This is the image description.
  •  Revenue sharing on flights between Singapore and Malaysia, subject to regulatory approval
  •  Significant expansion of regional and long-haul codeshare routes

Malaysia Airlines Berhad (MAB) and Singapore Airlines (SIA) have signed a wide-ranging commercial agreement that will significantly strengthen the long-standing partnership between the two airline groups. Subject to regulatory approvals from the relevant competition authorities, the national carriers propose to share revenue on flights between Singapore and Malaysia, expand codeshare routes, and participate in joint marketing activities to develop tourism.

The new agreement also includes SIA’s subsidiaries SilkAir and Scoot, as well as Firefly, the sister airline of MAB. It follows the signing of a memorandum of understanding in June 2019, which aimed to provide new customer benefits as well as new business opportunities.

Flights between Singapore and Malaysia will operate under a joint business arrangement. MAB and SIA intend to coordinate flight schedules to provide customers with more flight choices and frequencies for passenger convenience. As part of the agreement, the two airline groups also plan to offer joint fare products, align corporate programmes to enhance the value proposition to customers, and explore tie-ups between their frequent-flyer programmes.

The two airline groups will also expand their codeshare arrangements to include more destinations on each other’s networks. Today, the airlines codeshare on flights between Singapore and Kuala Lumpur, Kota Kinabalu, Kuching and Penang.

With the expansion, SIA and SilkAir plan to codeshare on MAB’s domestic flights and as such serve a total of 16 destinations1 in Malaysia.

In turn, MAB will progressively codeshare on flights between Singapore and Malaysia, Europe, South Africa and other destinations once necessary approvals are granted. This will be implemented in phases. It represents a significant expansion of the existing codeshare agreement and will provide MAB with more opportunities to expand connectivity to and from Malaysia.

In addition, MAB and SIA have agreed to work on joint marketing activities to boost long-haul tourism to Malaysia and Singapore. Both airlines will also explore the potential development of airpasses, which will enable customers travelling to Malaysia through the Kuala Lumpur and Singapore hubs more choices to visit other parts of the country such as Kuantan, Kuching and Kota Kinabalu on a single ticket. Travellers can expect a seamless experience of convenience and flexibility while enjoying multi-stop itineraries.

“We are very pleased to take our partnership with Malaysia Airlines to a new level. This will be a win-win for both our airline groups, and provide new benefits for our customers. In particular, the expanded scope of our partnership has the potential to provide a significant boost to the tourism industries in both Malaysia and Singapore, as well as the wider Southeast Asia region,” said SIA CEO, Mr Goh Choon Phong.

MAB CEO, Captain Izham Ismail said, “We are honoured to collaborate alongside SIA in providing our customers a more competitive product between Malaysia and Singapore and the opportunity to travel to more global destinations. This is in line with Malaysia Airlines’ long-term business plan goal of engaging in deep partnerships to extend our reach and presence globally. This partnership is more than a conventional partnership and we believe in the mutual benefits for both airline groups and countries.”

Subject to regulatory approvals, the codeshare flights will be progressively made available for sale through the airlines’ respective booking channels in key markets around the world.

 

_________________________

 

1Alor Setar, Bintulu, Johor Bahru, Kota Bahru, Kota Kinabalu, Kuala Lumpur, Kuala Terengganu, Kuantan, Kuching, Labuan, Langkawi, Miri, Penang, Sandakan, Sibu, Tawau

Singapore Airlines lands in Seattle/Tacoma

 

Start of SEA service on September 3, 2019

Singapore Airlines operated its first nonstop service from Singapore to Seattle/Tacoma, arriving on September 3 at SEA.

Pictured is Airbus A350-941 9V-SMV (msn 329) operating as “Singapore 28 Heavy” on its final approach to runway 16L at SEA.

Copyright Photo: Singapore Airlines Airbus A350-941 9V-SMV (msn 329) SEA (Joe G. Walker). Image: 947455.

Singapore Airlines aircraft slide show:

Singapore Airlines aircraft photo gallery:

Singapore Airlines to launch $50 million upgrade of Changi Airport T3 Lounges

Singapore Airlines has made this annoucement:

Singapore Airlines (SIA) will be investing more than SGD50 million in a major revamp of its SilverKris and KrisFlyer Gold Lounges at Changi Airport Terminal 3. Renovations are due to commence in August 2019 and are expected to be completed by mid-2021.

The redevelopment project will see an overall 30% increase in space and total customer capacity for the Terminal 3 lounges. The new lounges will offer more generous open spaces, upgraded facilities and a wide array of F&B selections, all tailored to the needs and preferences of our customers. SIA has engaged renowned hospitality designers Hirsch Bedner Associates to inject a fresh look and feel to each lounge that is modern yet homely, while inspiring a sense of timeless elegance.

For the ultimate bespoke lounge experience, Suites and First Class customers can look forward to a brand new The Private Room and First Class Lounge, with carefully designed luxurious and intimate seating spaces suitable for both work and rest. The First Class Lounge will continue to feature a flagship bar, and The Private Room, a full-service fine dining section within the lounge. Customers can look forward to an enhanced epicurean journey with fresh and seasonally curated dining offerings, on top of the perennial local favourites.

The Business Class Lounge will be expanded and feature four distinct zones that cater to travellers with different needs. Customers with a short transit can have a light snack in a relaxed café setting, while those with more time to spend may explore a full selection of Asian and international cuisines in the dining hall, including live stations that will offer signature local delights.

A highlight of the new Business Class Lounge will be a full service bar that doubles up as a self service breakfast station in the mornings. Productivity pods will also be available for customers who need a discreet corner to catch up on work, while a rest area with chaise lounges will be provided for customers to catch some shut-eye before their flight.

The KrisFlyer Gold Lounge will double in capacity and include dedicated working spaces, as well as larger al fresco seating and dining areas. The lounge will also be equipped with restrooms and showers.

The construction process will be carried out over four phases, during which the lounges will be progressively renovated in sections, starting with the Business Class Lounge, followed by the First Class Lounge and The Private Room, and finally the KrisFlyer Gold Lounge. Customers affected by renovation works will be invited to temporary lounges to ensure minimal disruption during this period.

All images by Singapore Airlines.