singapore airlines group analyst/media briefing · 5 november 2012 the parent airline 1h fy2012/13...
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Singapore Airlines GroupSingapore Airlines GroupAnalyst/Media Briefing
HALF YEAR FY2012HALF YEAR FY2012--13 RESULTS13 RESULTS5 NOVEMBER 20125 NOVEMBER 2012
THE PARENT AIRLINETHE PARENT AIRLINE1H FY2012/131H FY2012/13
RESULTSRESULTS
THE PARENT AIRLINE COMPANY THE PARENT AIRLINE COMPANY RESULTS RESULTS –– 2Q & 1H FY12/132Q & 1H FY12/13
Slide 3
84Operating Profit (5)
3,057Total Expenditure
1,241- Fuel Cost(14)- Fuel Hedging (Gain)/Loss
1,830- Ex-fuel Cost
(113)
(72)24(65)
3,141Total Revenue
2Q/12$million
108
Better/(Worse)$million
2.7Operating Profit Margin (%)
(0.2) pt
116169
(194)6,076
3106,245
1H/12$million
(100)2,484(11)11(83)3,581
Better/(Worse)$million
1.8 pts2.7
THE PARENT AIRLINE COMPANY THE PARENT AIRLINE COMPANY OPERATING PERFORMANCE OPERATING PERFORMANCE –– 2Q & 1H FY12/132Q & 1H FY12/13
Slide 4
23,895Revenue Pax-KM(million)
2Q/12
+6.5
% Change
79.8Passenger Load Factor (%)
+0.5 pt
29,952Available Seat-KM (million)
+5.8 +5.158,938
+2.1 pts79.6
+8.046,934
1H/12%
Change
Slide 5
Passenger Yield(¢/pkm)
Passenger Unit Cost(¢/ask)
Passenger Breakeven Load Factor (%)
11.4 -2.6
9.1 -1.1
79.8 +1.2 pts
THE PARENT AIRLINE COMPANY THE PARENT AIRLINE COMPANY OPERATING PERFORMANCE OPERATING PERFORMANCE –– 2Q & 1H FY12/132Q & 1H FY12/13
2Q/12%
Change
-1.19.1
-3.411.4
+1.8 pts79.8
1H/12%
Change
THE PARENT AIRLINE COMPANY THE PARENT AIRLINE COMPANY OPERATING PERFORMANCEOPERATING PERFORMANCE
77.9
0
68
72
76
80
84
88
1H 08/09 1H 09/10 1H 10/11 1H 11/12 1H 12/13
Passenger Load Factor
(%)
75.6
79.477.5
79.6
Slide 6
THE PARENT AIRLINE COMPANY THE PARENT AIRLINE COMPANY OPERATING PERFORMANCEOPERATING PERFORMANCE
72.2
86.0
75.4
78.079.8
77.9
0
68
72
76
80
84
88
1H 08/09 1H 09/10 1H 10/11 1H 11/12 1H 12/13
Passenger Load FactorBreakeven Load Factor
(%)
75.6
79.4
77.579.6
Slide 7
THE PARENT AIRLINE COMPANY THE PARENT AIRLINE COMPANY OPERATING PERFORMANCEOPERATING PERFORMANCE
72.2
86.0
75.4
78.079.8
77.9
0
68
72
76
80
84
88
1H 08/09 1H 09/10 1H 10/11 1H 11/12 1H 12/13
Passenger Load FactorBreakeven Load Factor
(%)
75.6
79.4
77.579.6
5.7
-10.4
4.0 -0.5-0.2
Slide 8
11.6 11.4
2011-12¢/pkm
0
9
10
11
12
13
14
Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
2009-10
10.4
9.7
THE PARENT AIRLINE COMPANY THE PARENT AIRLINE COMPANY MONTHLY PASSENGER YIELDMONTHLY PASSENGER YIELD
Slide 9
11.2
2012-13
11.6
11.9
10.0
Fuel Price before hedging
Fuel Expenditure (before hedging)($ million) (USD/BBL)
0
600
800
1,000
1,200
1,400
1,600
1,800
2,000
0102030405060708090100110120130140150160170
1,2141,170
1,254 1,2511,243
649
1,094
1,743
1,557
631
2009-10 2010-11 2011-12
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q
2008-09
4Q 1Q
2012-13
2Q
1,241
149160
98
61 64
136
130
129
133
132126
THE PARENT AIRLINE COMPANY THE PARENT AIRLINE COMPANY FUELFUEL PRICE AND EXPENDITURE PRICE AND EXPENDITURE -- TRENDTREND
Slide 10
THE PARENT AIRLINE COMPANY THE PARENT AIRLINE COMPANY COST COMPOSITION COST COMPOSITION –– 1H FY12/131H FY12/13
Fuel41.1%
+0.6% ptPassenger Costs5.4%
+0.5% pt
Aircraft Depreciation & Rentals
13.5% -1.9% pts
Staff Costs 13.2%
+0.6+0.6% pt
Handling Charges7.1%
+0.2% pt
Others19.7%
Slide 11
THE PARENT AIRLINE COMPANY THE PARENT AIRLINE COMPANY TOP 5 EXPENDITURE TOP 5 EXPENDITURE –– 1H FY12/131H FY12/13
Slide 12
0 500 1,000 1,500 2,000 2,500 3,000
Passenger Costs
Handling Charges
Staff Costs
Aircraft Depr. &Lease Rentals
Fuel
1H FY11/12
1H FY12/13
432 (+6.5% , +$26M)
330 (+14.6% , +$42M)
818 (-9.6% , -$87M)
801 (+8.4% , +$62M)
2,495 (+4.7% , +$111M)
($ million)
($ million)
THE PARENT AIRLINE COMPANY THE PARENT AIRLINE COMPANY FUELFUEL EXPENDITURE EXPENDITURE –– 1H FY12/131H FY12/13
0
2,100
2,200
2,300
2,400
2,500
2,600
1H/11 1H/12
2,384
Price
-89Lower
weighted average
fuel price
Volume
+128
Higher volumeuplifted
Exchange
+61
Stronger US Dollar
Hedging
+11
Hedging loss vs
hedging gain
2,495(+111)
Slide 13
THE GROUPTHE GROUP1H FY2012/131H FY2012/13
RESULTSRESULTS
($ million)2011/12 2012/13
GROUP REVENUE – 1H FY2012/13
3,578
3,777
0
2,750
3,000
3,250
3,500
3,750
4,000
Q1 Q2
Year-on-Year$294M+4.0%
Half Year Revenue$7,571M
+199+5.6%
3,6993,794
+95+2.6%
Slide 15
2011/12 2012/13
GROUP EXPENDITURE– 1H FY2012/13
3,5673,706
Q1 Q2
($ million)
0
2,750
3,000
3,250
3,500
3,750
4,000
Year-on-Year$286M+4.0%
Half Year Expenditure
$7,429M
+139+3.9% 3,576
3,723+147+4.1%
Slide 16
2011/12 2012/13
GROUP OPERATING PROFIT– 1H FY2012/13
11
72
0
25
50
75
100
125
150
Q1 Q2
Half Year Op Profit$142M
Year-on-Year$8M
+6.0%
($ million)
+61(n.m.)
123
70
-53-43.1%
Slide 17
CONTRIBUTION TO GROUP OPERATING CONTRIBUTION TO GROUP OPERATING PROFIT PROFIT –– 1H FY12/13 ($ million)1H FY12/13 ($ million)
37
169
1H/12
(99)
66
SilkAir
Singapore Airlines
SIA Cargo
SIA Engineering
34
53
(31)
69
1H/11
3+
116+
68-
3-
Change
Slide 18
8.8+
n.m.
n.m.
4.3-
% Change
($ million)2011/12 2012/13
GROUP NET PROFIT– 1H FY2012/13
45
78
0
50
100
150
200
Q1 Q2
+33+73.3%
194
90
-104-53.6%
Half Year Net Profit
$168M
Year-on-Year$71M
-29.7%
Slide 19
($ million)
GROUP NET PROFIT – 1H FY2012/13
0
50
100
150
200
250
300
1H/11 OperatingProfit
Higher operating
profit
+8
AircraftDisposal
Loss on disposal of aircraft vsgain last
year
-67
Non-Operating
Item
Return of capital from
VAL last year
-48
Associatesand JV
+16
Higher share of
profit from associates
and JV
Interestand
Others
+20
Lower net interest and
others
239
1H/12
168-71-29.7%
Slide 20
GROUP RESULTS GROUP RESULTS –– 1H FY12/131H FY12/13
Slide 21
10.06.0Interim Dividend Per Share (¢)
1.231.11EBITDAR Per Share ($)
1H/111H/12
10.9611.04Net Asset Value Per Share ($)
At 31 Mar 12At 30 Sep 12
20.014.3Earnings Per Share (¢)
BUSINESS OUTLOOK BUSINESS OUTLOOK FOR THE FOR THE
22ndnd HALF YEARHALF YEAR
OUTLOOK OUTLOOK
Slide 23
High and volatile fuel price
Weaker global economy
Operating Fleet at 30 September 12
Operating Fleet at 31 March 13
IN: Delivery of A333
FLEET DEVELOPMENT
4
4
-
SCOOT
101
102
+ 1
SIA
22
22
-
SLK
Slide 24
Operating Fleet at 31 March 13
New deliveries from April 2013:
SIA FLEET DEVELOPMENT
102
SIA
Delivery of B773-ER (2013 onwards ) + 8
Delivery of A330 (2013 onwards) + 14
Delivery of A380 (2017 onwards ) + 5
Delivery of A350 (2015 onwards) + 20
Delivery of A350 (2017 onwards) + 20
Slide 25
Operating Fleet at 31 March 13
SILKAIR FLEET DEVELOPMENT
22
SLK
Delivery of B737 (From 2014 to 2021) + 54
Delivery of A320 (In 2013) + 2New deliveries from April 2013:
Slide 26
Operating Fleet at 31 March 13
SCOOT FLEET DEVELOPMENT
4
SCOOT
Delivery of B787 (2014 onwards) + 20New deliveries from April 2013:
Slide 27
GROUP CAPITAL EXPENDITURE
FY13/14 FY14/15 FY15/16 FY16/17 FY17/18
Aircraft 1,250 1,850 2,950 3,150 3,950
Other Assets 250 250 200 200 200
Total 1,500 2,100 3,150 3,350 4,150
Slide 28
GROUP FUEL HEDGING POSITION
Slide 29
Percentage hedged for period Oct 12 to Mar 13 43(%)
Avg hedged price for period Oct 12 to Mar 13 123(USD/BBL - Jet Fuel)
MEETING THEMEETING THECHALLENGESCHALLENGES
SilkAir (MI)Regional
SIA (SQ)Regional, Medium and Long haul
Premium Full Service
Group Portfolio
SilkAir (MI)Regional
SIA (SQ)Regional, Medium and Long haul
No Frills
Slide 31
SilkAir (MI)Regional
SIA (SQ)Regional, Medium and Long haul
Integrated planning and operations Joint fleet and route planning, Yield management Sales and marketing Airport operations
Outcome Cross-selling increased 25% Enabling growth
Slide 32
Premium Full Service
No Frills
Group Portfolio
The LCCs stimulate new traffic and tap new market segments
Scoot (TZ)Medium and Long haul
Slide 33
Premium Full Service
No Frills
Group Portfolio
Regional LCC PartnerE.g. Tiger (TR)
Scoot (TZ)Medium and Long haul
Consistent no frills offering Interline relationship Potential codeshare?
Slide 34
Premium Full Service
No Frills
Group Portfolio
Regional LCC PartnerE.g. Tiger (TR)
SIA (SQ)Regional, Medium and Long haul
Distinct positioning at each end of market spectrum
Lower risk of cannibalization
SilkAir (MI)Regional
Slide 35
Premium Full Service
No Frills
Scoot (TZ)Medium and Long haul
Group Portfolio
Regional LCC PartnerE.g. Tiger (TR)
Other LCCs
SilkAir (MI)Regional
SIA (SQ)Regional, Medium and Long haul
Scoot (TZ)Medium and
Long haulOther LCCs Other LCCsOther LCCs
Our LCCs take market share from other players in product continuum
Slide 36
Premium Full Service
No Frills
Group Portfolio
Regional LCC Partner
E.g. Tiger (TR)
SilkAir (MI)Regional
SIA (SQ)Regional, Medium and Long haul
Scoot (TZ)Medium and
Long haul
Traffic through other hubs
Other Full Service Carriers
Other LCCsOther LCCs
Slide 37
Premium Full Service
No Frills
Our LCCs take market share from other players in product continuum
Group Portfolio
Regional LCC Partner
E.g. Tiger (TR)
Network & Connectivity
Network organic growth
– SQ/MI growth
Slide 38
SQ/MI ASK Y-o-Y Change (%)
5.7%
5.3%
2.9%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
FY1011 FY1112 FY1213 (Apr-Aug)
SQ+MI ASK Y-o-Y Change (%)
FY 2010India
10 points77x weekly
8 points73x weekly
China Africa
SIA Group
3 points12x weekly
9 points118x weekly
Indonesia
5 points92x weekly
Australia
Slide 39
Network & Connectivity
FY 2012
9 points118x weekly
Indonesia
India
10 points77x weekly
8 points73x weekly
China Africa
11 points96x weekly
13 points116x weekly
3 points14x weekly
3 points12x weekly
11 points136x weekly
5 points92x weekly
Australia
7 points124x weekly
SIA Group
Slide 40
Network & Connectivity
Airline partnerships
– Fill gaps in network
– Compete against other partnerships
– STAR Alliance starting point
– Additional partnerships beyond STAR
Slide 41
Network & Connectivity
New and deepened partnerships since 2011
Slide 42
Network & Connectivity
Product Leadership and Service Excellence
We will remain at the forefront of airline product innovation and service excellence
Slide 43
Aircraft Cabin and Seats
BMW DesignworksUSA – First Class
James Park Associates – Business Class
Introduced with new deliveries of Boeing 777-300ERs (2H 2013)
Highlights of New Initiatives
Slide 44
Product Leadership and Service Excellence
Highlights of New Initiatives
Inflight Entertainment System
USD 400m investment and launch customer for Panasonic Avionics’ next-generation system
In-flight connectivity on long haul aircraft (progressively from April 2012)
Slide 45
Product Leadership and Service Excellence
SilverKris Lounges (SKL)
Ong & Ong developing new design concept for SKL
$20 million investment in next 5 yrs for all lounges
Commencing with Sydney SKL (from mid 2013)
Highlights of New Initiatives
Slide 46
Product Leadership and Service Excellence
Highlights of New Service Initiative
Customer Experience Management (CEM)
Vision is to develop a 3600 view of our customers
Deliver proactive and personalized services at more touch points
Take SIA’s service leadership to a higher level
Slide 47
Product Leadership and Service Excellence
Leveraging on new systems & tools IT enabler Use of mobile technology
Streamlining of processes & procedures Align internal processes with the CEM
vision
Soft skills training Launch of a new service theme
– “Creating Extraordinary Moments”
3-Pronged Strategy To Deliver the CEM Vision
Slide 48
Product Leadership and Service Excellence
Thank You
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