8 November 2017 THE PARENT AIRLINE Q2 AND 1H FY17/18 RESULTS THE - - PowerPoint PPT Presentation

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8 November 2017 THE PARENT AIRLINE Q2 AND 1H FY17/18 RESULTS THE - - PowerPoint PPT Presentation

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SIA ANALYST/MEDIA BRIEFING Q2 and 1H FY17/18 Results 8 November 2017 THE PARENT AIRLINE Q2 AND 1H FY17/18 RESULTS THE PARENT AIRLINE COMPANY OPERATING PERFORMANCE % % Q2 1H Change Change FY17/18 FY17/18 Available Seat-KM 30,047

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SLIDE 1

SIA ANALYST/MEDIA BRIEFING Q2 and 1H FY17/18 Results 8 November 2017

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SLIDE 2

THE PARENT AIRLINE Q2 AND 1H FY17/18 RESULTS

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SLIDE 3

THE PARENT AIRLINE COMPANY OPERATING PERFORMANCE

Passenger Load Factor (%) Revenue Pax-KM (million) Available Seat-KM (million)

81.8 24,579 30,047 +1.4 pts +2.3 +0.5

Q2 FY17/18

80.9 47,755 59,010 +2.8 pts +3.4

  • 0.1

1H FY17/18 % Change % Change

Slide 3

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SLIDE 4

THE PARENT AIRLINE COMPANY OPERATING PERFORMANCE

Passenger Yield (¢/pkm)

10.0

  • 2.0

Q2 FY17/18 % Change

10.1

  • 1.9

% Change 1H FY17/18

Slide 4

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SLIDE 5

THE PARENT AIRLINE COMPANY OPERATING PERFORMANCE

Monthly Pax Yields

11.0 10.8 10.7 10.5 10.2 10.7 11.2 11.1 11.0 10.7 10.8 10.6 10.7 10.4 10.3 10.3 9.8 10.3 10.4 10.4 10.7 10.5 10.0 10.2 10.1 10.1 10.2 10.1 9.8 10.2

9.5 10.5 11.5

Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar

¢/pkm

FY15/16 FY16/17 FY17/18 Slide 5

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SLIDE 6

THE PARENT AIRLINE COMPANY OPERATING PERFORMANCE

Passenger Unit Ex- Fuel Cost (¢/ask) Passenger Unit Cost (¢/ask) Passenger Yield (¢/pkm)

5.8 8.2 10.0

  • 2.0

Q2 FY17/18 % Change

5.8 8.2 10.1 +1.8 +1.2

  • 1.9

% Change

81.2 +2.6 pts

Passenger Breakeven Load Factor (%)

82.0 +1.6 pts

1H FY17/18 Revenue per ASK (¢/ask)

8.2

  • 8.2

+1.2

Slide 6

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SLIDE 7

THE PARENT AIRLINE COMPANY OPERATING PERFORMANCE

(%) Breakeven Load Factor Passenger Load Factor

79.6 79.8 80.0 78.1 80.9

  • 2.5
  • 1.1
  • 0.5
  • 0.3

82.1 80.9 81.3 78.6 81.2 70 75 80 85 1H FY13/14 1H FY14/15 1H FY15/16 1H FY16/17 1H FY17/18

  • 1.3

Slide 7

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SLIDE 8

THE PARENT AIRLINE COMPANY RESULTS

170 Operating Profit 91 2,686 Total Expenditure

713 Fuel Cost 3 Fuel Hedging Loss

1,970

  • Ex-fuel Cost

1

(95) 112

(16)

2,856 Total Revenue Q2 FY17/18 $million 90 Better/ (Worse) $million 5.9 Operating Profit Margin (%) 3.0 pts

  • Net Fuel Cost

716 17

135 411 (26) 5,313 161 5,724

(194) 1,398 202 24

(35) 3,891

Better/ (Worse) $million 2.2 pts 7.2

9 1,422

1H FY17/18 $million

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SLIDE 9

THE PARENT AIRLINE COMPANY COST COMPOSITION

*Landing, Parking and Overflying

Fuel Cost Post Hedging 1,422.3 (-8.5, -0.6%) Others 643.6 (+23.4, +3.8%) Passenger Costs 327.7 (-6.7, -2.0%) LPO* Charges 313.7 (+14.4, +4.8%) Handling Charges 465.3 (+12.8, +2.8%) Staff Cost 852.4 (+27.6, +3.3%) AMO Costs 362.3 (-39.2, -9.8%) Aircraft Depreciation and Lease Rentals 926.0 (+1.9, +0.2%)

26.8% 12.1% 8.8% 6.2% 5.9% 16.0% 17.4% 6.8%

1H FY17/18 ($’M)

Slide 9

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SLIDE 10

THE PARENT AIRLINE COMPANY FUEL EXPENDITURE

($ million)

  • 9

(-0.6%)

1,431

  • 202

+168 +25 1,422 1,100 1,200 1,300 1,400 1,500 1H FY16/17 Hedging Price Exchange 1H FY17/18 Higher weighted average fuel price Lower hedging loss Stronger USD against SGD

Slide 10

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SLIDE 11

(¢/ask)

THE PARENT AIRLINE COMPANY UNIT COST ANALYSIS

8.1 8.2 4.3 4.4 (+2.3%) 1.4 1.4 (-) 2.4 2.4 (-) 2 4 6 8 10 1H FY16/17 1H FY17/18

Unit Fuel Cost Unit Staff Cost Unit Other Cost

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SLIDE 12

SIA GROUP Q2 AND 1H FY17/18 RESULTS

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SLIDE 13

($ million)

1H 17/18 Revenue $7,712M Year-on-Year $9M

  • 0.1%

FY16/17 FY17/18

Year-on-Year $401M +5.5%

GROUP REVENUE

3,658 3,653 3,847 3,711 3,864 3,848 3,500 3,600 3,700 3,800 3,900 Q1 Q2 Q3 Q4 Q1 Q2

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SLIDE 14

($ million)

1H 17/18 Expenditure $7,199M Year-on-Year $9M

  • 0.1%

FY16/17 FY17/18

Year-on-Year $190M +2.7%

GROUP EXPENDITURE

3,465 3,544 3,554 3,683 3,583 3,616 3,300 3,400 3,500 3,600 3,700 Q1 Q2 Q3 Q4 Q1 Q2

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SLIDE 15

($ million)

1H 17/18 Op Profit $513M Year-on-Year $9M

  • 0.1%

FY16/17 FY17/18

Year-on-Year $211M +69.9%

GROUP OPERATING PROFIT

193 109 293 28 281 232 100 200 300 400 Q1 Q2 Q3 Q4 Q1 Q2

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SLIDE 16

135 276 411 Singapore Airlines 1H FY17/18 (23) 44 21 SilkAir (12) 17 5 Scoot Change 48.9 52.3

  • 70.6

% Change 77 (45) 32 SIA Cargo n.m.

CONTRIBUTION TO GROUP OPERATING PROFIT

15 23 38 SIAEC 65.2

  • ($ million)

1H FY16/17

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SLIDE 17

($ million)

1H 17/18 Net Profit $425M Year-on-Year $9M

  • 0.1%

FY16/17 FY17/18

Year-on-Year $103M +32.0%

GROUP PROFIT ATTRIBUTABLE TO OWNERS OF PARENT

257 65 177

  • 138

235 190

  • 200
  • 100

100 200 300 Q1 Q2 Q3 Q4 Q1 Q2

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SLIDE 18

GROUP PROFIT ATTRIBUTABLE TO OWNERS OF PARENT

322 +211

  • 27
  • 178

+46 +39

  • 25

+37 425 100 200 300 400 500 600 1H FY16/17 Operating profit Interest Divestment

  • f HAESL

Associates Aircraft Taxation NCI 1H FY17/18 +103 (+32.0%) Absence of gain on SIAEC’s divestment & special dividend Lower share of losses of Assoc. Higher taxation Higher

  • perating

profit Lower non- controlling interests Net interest expense against income last year Gain on disposal of aircraft vs loss last year (+18); and absence of Scoot’s impairment

  • n two 772

aircraft last year (+21) ($ million)

Slide 18

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SLIDE 19

9.0 10.0 Interim Dividend Per Share (¢) 1.43 1.53 EBITDAR Per Share ($) 1H FY16/17 1H FY17/18 11.07 11.39 Net Asset Value Per Share ($) At 31 Mar’17 At 30 Sep’17 27.2 36.0 Earnings Per Share (¢)

PER SHARE DATA

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SLIDE 20

FLEET DEVELOPMENT

SIA SilkAir Scoot SIA Cargo Operating Fleet as at 30 September 2017 108 30 38 7 IN: A380-800 +2 A350-900 +4 737 MAX 8 +3 787-8 +1 A320 +3^ OUT: A380-800

  • 3

A330-300

  • 1

777-200

  • 1

777-200ER

  • 1

A320

  • 1

Operating Fleet as at 31 March 2018 108 33 41 7

^ These were A320s subleased to IndiGo that will be returned to the operating fleet Slide 20

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SLIDE 21

GROUP CAPITAL EXPENDITURE

($’million) FY18/19 FY19/20 FY20/21 FY21/22 FY22/23 Aircraft 5,600 5,900 5,800 5,200 4,400 Other Assets 400 300 300 300 300 Total 6,000 6,200 6,100 5,500 4,700

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SLIDE 22

GROUP FUEL HEDGING POSITION

2H FY17/18 Jet Fuel Brent Percentage hedged (%) Average hedged price (USD/BBL) 29.5 65 11.7 53 Maturities Up To FY22/23 Jet Fuel Brent Percentage hedged (%) Average hedged price (USD/BBL)

  • Up to 47%

53-59

Slide 22

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SLIDE 23

STRATEGIC DEVELOPMENTS

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SLIDE 24

Strengthening Premium Positioning Multi-Hub Portfolio New Business Opportunities KEY STRATEGIES

Slide 24

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SLIDE 25

STRENGTHENING PREMIUM POSITIONING

New A380 Cabin Products

  • Launched 2 Nov 2017 with debut

service to Sydney on 18 Dec 2017

  • New industry leading cabin products,

with enhanced KrisWorld experience

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SLIDE 26

777-9 & 787-10

  • US$13.8B order signed with Boeing for 20

777-9s and 19 787-10s

  • Caters for additional growth and fleet

modernisation through the next decade A350-900ULR

  • 2018 – Expansion of non-stop services to

USA, including New York and Los Angeles New Medium-Haul Cabin Products

  • 2018 – New medium-haul cabin on 787-10

& A350-900

STRENGTHENING PREMIUM POSITIONING

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SLIDE 27

Completion of Scoot and Tigerair Integration

  • Enhanced synergies with both LCCs under a

single brand from 25 July 2017

  • Enabled 6 new destinations to be launched or

announced in FY17/18, including Honolulu and seasonal Harbin flights

PORTFOLIO

Slide 27

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SLIDE 28

PORTFOLIO

NETWORK OPTIMISATION

Scoot SilkAir Singapore Airlines

Dusseldorf Athens Hiroshima Stockholm Slide 28 Harbin Palembang Kuching Kuantan Honolulu Yangon

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SLIDE 29

PORTFOLIO The SIA Group serves 137 destinations in 37 countries

Slide 29

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SLIDE 30
  • Investments in strategic markets
  • Complements and strengthens Singapore hub through synergies
  • 21 destinations and 16 A320s (6 A320s on order)
  • Strategically placed to tap into the large and

growing Indian market

  • Preparing to launch international operations from

2H 2018

  • 7 destinations and 4 B777-200s
  • Positioned to leverage on strong leisure travel

market

  • Network to expand following recent ICAO safety

upgrade of Thai aviation sector

MULTI-HUB

Slide 30

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SLIDE 31

NEW REVENUE & BUSINESS OPPORTUNITIES

SIA-CAE Flight Training Centre

  • Equally-owned

JV for pilot training in Singapore

  • Operations expected to commence from end
  • f FY17/18
  • Provides full range of initial type rating and

recurrent training programmes for Boeing 737 MAX, 747, 777 and 787 aircraft types

Slide 31

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SLIDE 32

TRANSFORMATION

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SLIDE 33
  • Grow revenue
  • Re-base our cost structure
  • Enhance organisational effectiveness
  • Three year programme
  • SVPs leading and committed to deliver on respective plans
  • 12 work stream coordinators
  • Over 200 staff involved thus far

POSITIONING SIA FOR GROWTH

Slide 33

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SLIDE 34
  • Over 60 initiatives under implementation, cutting across the business:

– Group-wide network review – New revenue management system – Leveraging data to optimise fuel uplift – Set up of new Customer Experience Division for greater focus on customer journey – Upskilling staff through roll-out of new digital training curriculum – New crew apps to enhance efficiency – Engaging strategic partners differently …and many more!

POSITIONING SIA FOR GROWTH

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SLIDE 35

THANK YOU