In what are more green shoots for the ‘arrival revival’ of travel, The Singapore Airlines (SIA) Group has posted a quarterly profit for the first time since the onset of the pandemic, recording a third quarter net profit of SD$85 million.
The airline said the positive result for the three months ended December 2021 came amid a significant step-up in air travel to and through Singapore in the October-December 2021 period, as well as continued robust demand and strong yields in the cargo market.
Singapore’s launch of Vaccinated Travel Lane (VTL) arrangements and its subsequent expansion, as well as the Group’s nimble response that resulted in it being the first to open sales on almost all available routes, helped unlock pent-up demand during the year-end travel season.
The Group carried 1.1 million passengers during the quarter, more than five times the number from a year before and double that of the second quarter of FY2021/22.
Passenger capacity (measured in available seat-kilometres) grew 183.8 per cent year-on-year, as the Group ramped up flights in response to the VTLs. By the end of the quarter, Group passenger capacity reached 45 per cent of pre-COVID-19 levels.
Fleet and network
During the quarter, the strong demand for VTL services enabled the reactivation of A380 operations to London and Sydney. SIA took delivery of one Airbus A350 and four Boeing 737-8 aircraft, while Scoot took delivery of two A321neo aircraft.
As of 31 December 2021, SIA’s operating fleet comprised 121 passenger aircraft and seven freighters while Scoot had 50 passenger aircraft in its operating fleet. With an average age of six years and three months, the Group operates one of the youngest and most fuel-efficient fleets in the airline industry.
SIA is expanding its VTL network to progressively include Cairns, Darwin, Dubai, Hong Kong, Manila, New York (Newark), and Phuket from 25 February 2022.
SIA will also step up frequencies for flights between Singapore and several existing VTL destinations including Bandar Seri Begawan, Colombo, Male, and Phnom Penh.
Scoot will progressively begin flights to nine new destinations including Chiang Mai, Cebu, Clark, Davao, Hong Kong, Jeddah, Krabi, London (Gatwick), and Phuket to its VTL network, and will also increase its frequency for services between Singapore and Phuket.
Scoot recently resumed its Gold Coast to Singapore direct flights as it moves to establish a daily connection in the near future.
With these new additions, the SIA Group will operate VTL services from 49 cities in 25 countries to Singapore.
Forward Outlook
SIA says Singapore’s VTL arrangements have been a game-changer for the Group, facilitating quarantine-free mass travel for the first time since the pandemic began. While demand should continue to recover, especially on VTL services, passenger traffic is likely to moderate in the fourth quarter after the end of the year-end holiday season.
The emergence of the Omicron variant in December 2021 resulted in additional border restrictions by some governments. However, those measures gradually eased as concerns about the virulence of the variant abated.
Several key markets have further relaxed testing requirements for incoming passengers, in line with their goal of living with the Covid-19 virus. The Group says it will remain nimble and proactive in adjusting its capacity and network, in tandem with the prevailing market conditions and regulations.
SIA also launched its all-new narrowbody cabin products, including lie-flat Business Class seats, on the Boeing 737-8 in November 2021.
Fuel prices have been trending higher and volatility is expected to persist in the months ahead. The Group says it will continue to keep a tight rein on costs while supporting the expansion of operations in line with demand.
To read the full report, head over to: www.singaporeair.com
