SIA pushes on with transformation plan as it cuts full year net loss by 78%

The Singapore Airlines (SIA) Group carried 3.9 million passengers in FY2021-22, which is up six-fold from a year before. According to its latest financials, international air travel recovered in the last six months as global border restrictions eased and the group cut its full-year net loss by 78%. With travel showing strong return, it also saw second-half operating profit.

This has allowed the group to push forth with its transformation programme which aims to reinforce SIA Group’s leadership position. The group said that its second three-year transformation programme which began in FY2020-21 continues to make good progress in revenue and cost initiatives as well as in the areas of innovation and digital transformation, and it will remain agile and leverage on opportunities to reinforce its leadership position in the airline industry.

According to its financials, various marketing campaigns have been launched to encourage customers to take to the skies again. These include a global brand campaign, “We Look Forward to Seeing You” in the Air Again, which promises customers an enhanced travel experience with SIA.

Promotions such as “Time to Fly”, which is SIA’s first online travel fair in Singapore with curated travel packages with 10 participating travel agents, serving all market segments, have also been launched.

On the loyalty front, KrisFlyer, the SIA Group’s loyalty programme, relaunched its KrisFlyer Spontaneous Escapes monthly promotion after two years to allow members to stretch the value of their miles and book last minute getaways to a variety of SIA destinations.

SIA also inked partnerships with Garuda Indonesia and Malaysia Airlines, which the group said will offer more options for customers, as well as enhanced connectivity to drive tourism in South East Asia. Meanwhile, the recent expansion of the codeshare agreement between United Airlines and SIA will enable customers to connect to even more destinations within both airlines’ network.

Meanwhile, its budget carrier brand Scoot reestablished partnerships with tourism boards across Australia and South East Asia, as well as the Singapore Tourism Board, to incentivise travel to and from Singapore.

Most recently, Singapore Airlines also extended its title sponsorship of the Formula One Singapore Airlines Grand Prix for three more years, starting with this year’s race which will be held from 30 September to 2 October 2022. It first signed as the title sponsor in 2014 for four years, and subsequently extended it in 2018 and 2020 for two years respectively.

Lee Lik Hsin, executive vice president, commercial, Singapore Airlines, said this year’s highly anticipated Formula 1 Singapore Grand Prix will be an important milestone for Singapore, marking the return of a major international sporting event to the city after a two-year disruption due to the pandemic.

Overall, the group ramped up passenger capacity, growing from 24% of pre-COVID levels in April 2021 to 51% by the end of FY2021-22 in March 2022. Singapore's launch and subsequent expansion of the Vaccinated Travel Lane (VTL) scheme was said to be the game changer for the group as it facilitated quarantine-free mass travel for the first time since the COVID-19 pandemic began, and significantly boosted the demand for flights to and through Singapore.

The Groupe said that by deploying capacity and increasing services in an agile manner, SIA and Scoot were among the first to launch flights for all VTL points. This allowed the carriers to capture the pent-up demand for air travel as it returned.

As a result, passenger flown revenue grew by SG$2,121 million (+309.6%) year-on-year to SG$2,806 million. This was on the back of a 614.9% growth in traffic (revenue-passenger kilometres), which outpaced the capacity expansion of 215.7% and resulted in the passenger load factor rising 16.8% points to 30.1%.  Cargo flown revenue reached a record SG$4,339 million (+60.2%), driven by strong demand amid continued capacity constraints for both sea freight and air freight. This led to a 44.5% increase in loads carried, and 10.8% rise in yields. Consequently, Group revenue rose SG$3,799 million (+99.6%) year-on-year to SG$7,615 million. Group expenditure grew by SG$1,896 million (+30.0%) year-on-year to SG$8,225 million.

Photo courtesy: 123RF

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