SI A ANALYST/ MEDI A BRI EFI NG 1H FY2014/15 Results 07 November 2014 THE PARENT AI RLI NE 1H FY2014/ 15 RESULTS 1
THE PARENT AI RLI NE COMPANY OPERATI NG PERFORMANCE – 2Q & 1H FY14/ 15 % % Change Change 2Q/ 14 1H/ 14 Available Seat-KM 30,562 -1.1 60,825 -0.2 (million) Revenue Pax-KM 25,016 -0.2 48,516 + 0.1 (million) Passenger Load 81.9 + 0.8 pt 79.8 + 0.2 pt Factor (% ) Slide 3 THE PARENT AI RLI NE COMPANY OPERATI NG PERFORMANCE – 2Q & 1H FY14/ 15 % % 2Q/ 14 Change 1H/ 14 Change Passenger Yield 10.9 -0.9 10.9 -0.9 (¢/ pkm) Passenger Unit Cost 9.0 -1.1 8.8 -3.3 (¢/ ask) Passenger Unit Ex-Fuel 5.1 - 4.9 -3.9 Cost (¢/ ask) Passenger Breakeven 82.6 -0.1 pt 80.7 -2.0 pts Load Factor (% ) Slide 4 2
THE PARENT AI RLI NE COMPANY RESULTS – 2Q & 1H FY14/ 15 Better/ Better/ (Worse) 2Q/ 14 (Worse) 1H/ 14 $million % $million $million % $million Total Revenue 3,222 - - 6,231 (151) (2.4) Total Expenditure 3,084 41 1.3 6,048 148 2.4 8.3 2,353 98 4.0 - Fuel Cost 1,175 105 - Fuel Hedging 18 (62) n.m. (10) 1 7.9 Loss/(Gain) - Ex-fuel Cost 1,891 (2) (0.1) 3,705 49 1.3 Operating Profit 138 41 42 183 (3) (1.6) Operating Profit 4.3 1.3 pts 2.9 - Margin (% ) Slide 5 THE PARENT AI RLI NE COMPANY OPERATI NG PERFORMANCE Passenger Load Factor Breakeven Load Factor (% ) 88 84 79.4 80 79.6 79.6 79.8 77.5 76 72 68 0 1H 10/ 11 1H 11/ 12 1H 12/ 13 1H 13/ 14 1H 14/ 15 Slide 6 3
THE PARENT AI RLI NE COMPANY OPERATI NG PERFORMANCE Passenger Load Factor Breakeven Load Factor (% ) 88 84 82.7 80.7 79.8 79.4 80 78.0 79.6 79.8 79.6 77.5 76 75.4 72 68 0 1H 10/ 11 1H 11/ 12 1H 12/ 13 1H 13/ 14 1H 14/ 15 Slide 7 THE PARENT AI RLI NE COMPANY OPERATI NG PERFORMANCE Passenger Load Factor Breakeven Load Factor (% ) 88 84 82.7 80.7 -3.1 79.8 79.4 -0.9 80 -0.2 78.0 79.6 79.6 79.8 -0.5 4.0 77.5 76 75.4 72 68 0 1H 10/ 11 1H 11/ 12 1H 12/ 13 1H 13/ 14 1H 14/ 15 Slide 8 4
THE PARENT AI RLI NE COMPANY MONTHLY PASSENGER YI ELD 2012-13 2013-14 2014-15 ¢/ pkm 12 11.6 11.6 11.5 11.4 11.4 11.4 11.3 11.3 11.2 11.2 11.2 11.3 11.1 11.3 11.3 11.2 11 10.9 11.1 11.1 11.1 11.1 10.8 11.0 10.9 10.9 10.7 10.8 10.8 10.7 10 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Slide 9 THE PARENT AI RLI NE COMPANY COST COMPOSI TI ON – 1H FY14/ 15 Others 10.1% (-0.3% pt) LPO* Charges 5.1% (+ 0.2% pt) Fuel Cost Post Hedging AMO Costs 5.4% (-) 38.7% (-0.7% pt) Passenger Costs 5.7% (+ 0.3% pt) Handling Charges 7.3% (+ 0.2% pt) Staff 12.9% (-0.1% pt) Aircraft Depreciation & Lease Rentals 14.8% (+ 0.4% pt) * Landing, Parking and Overflying Slide 10 5
THE PARENT AI RLI NE COMPANY TOP EXPENDI TURE I TEMS – 1H FY14/ 15 Composition of decrease in Operating Expenditure $M -99.1 (-4.1% ) 6,195.7 6,200 Higher 6,150 revaluation - 147.7 and (-2.4% ) -26.7 hedging (-3.3% ) -6.9 loss 6,100 (-2.1% ) Lower 6,048.0 net fuel + 11.5 + 8.1 cost -34.6 (+ 44.1% ) (+ 2.4% ) (-1.5% ) 6,000 0 H1 Passenger Exchange Others H1 Fuel Staff AMO FY13/ 14 after Cost Cost FY14/ 15 Cost hedging Slide 11 THE PARENT AI RLI NE COMPANY FUEL PRI CE AND EXPENDI TURE - TREND Fuel Price after hedging Fuel Cost after hedging ($ million) Fuel Price before hedging 2,000 160 150 136 140 1,800 134 126 127 126 124 124 123 130 135 132 1,600 120 121 123 124 121 120 122 110 100 96 1,400 94 100 90 90 90 93 90 88 1,268 85 1,200 80 1,236 80 1,206 1,194 1,174 1,156 1,150 70 1,000 60 960 50 939 899 859 851 40 800 30 600 20 10 0 400 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 Slide 12 6
THE PARENT AI RLI NE COMPANY FUEL EXPENDI TURE – 1H FY14/ 15 $M Lower 2500 volume uplifted 2,442 Lower Higher weighted 2400 Weaker - 99 hedging average US Dollar (- 4.1 % ) gain vs fuel price - 75 last year 2,343 - 14 - 9 - 1 2300 1H Volume Exchange Price Hedging 1H FY13/ 14 FY14/ 15 Slide 13 THE GROUP 1H FY2014/ 15 RESULTS 7
GROUP REVENUE – 1H FY2014/ 15 2013/ 14 2014/ 15 ($ million) Half Year 4,000 Revenue 3,901 3,905 + $4m 3,840 + 0.1% $7,587M -$158m 3,682 3,750 -4.1% Year-on-Year 3,500 $154M -2.0% 3,250 3,000 2,750 0 Q1 Q2 Slide 15 GROUP EXPENDI TURE – 1H FY2014/ 15 2013/ 14 2014/ 15 ($ million) Half Year 4,000 Expenditure 3,814 3,773 -$41m 3,758 $7,416M -1.1% -$115m 3,750 3,643 -3.1% Year-on-Year 3,500 $156M -2.1% 3,250 3,000 2,750 0 Q1 Q2 Slide 16 8
GROUP OPERATI NG PROFI T – 1H FY2014/ 15 2013/ 14 2014/ 15 ($ million) Half Year 150 Op Profit 132 $171M + $45m 125 + 51.7% Year-on-Year 100 87 $2M 82 + 1.2% 75 -$43m -52.4% 50 39 25 0 Q1 Q2 Slide 17 CONTRI BUTI ON TO GROUP OPERATI NG PROFI T – 1H FY14/ 15 ($ million) 1H 13/ 14 Change 1H 1415 % Change Singapore Airlines 183 186 - 3 - 1.6 SI A Engineering 37 56 - 19 - 33.9 SilkAir 5 22 - 17 - 77.3 + (34) (71) + 37 SI A Cargo 52.1 Slide 18 9
GROUP NET PROFI T – 1H FY2014/ 15 2013/ 14 2014/ 15 Half Year ($ million) Net Profit 200 $126M 161 150 Year-on-Year -$70M $157M 122 -43.5% -55.5% 100 91 -$87M -71.3% 50 35 0 Q1 Q2 Slide 19 GROUP NET PROFI T – 1H FY2014/ 15 ($ million) 300 283 -154 250 -157 200 -55.5% 150 -32 -4.0 + 31 126 Share of + 2 losses from 100 Others associates Exceptional Higher Higher against items operating gain on 50 profits last disposal of profit year aircraft 0 Associates Exceptional Operating 1H Aircraft I nterest 1H I tems Profit FY13/ 14 Disposal and FY14/ 15 Others Slide 20 10
GROUP RESULTS – 1H FY2014/ 15 1H 1415 1H 1314 EBI TDAR Per Share ($) 1.09 1.25 Earnings Per Share (¢) 10.7 24.0 I nterim Dividend Per 5.0 10.0 Share (¢) At 30 Sep 14 At 31 Mar 14 Net Asset Value Per 10.96 11.26 Share ($) Slide 21 FLEET DEVELOPMENT - SI A No. of Aircraft Operating Fleet at 30 September 14 105 I N: Delivery of A330-300 + 2 Delivery of B777-300ER + 3 OUT: Decommissioned B777-200 - 4 OUT: Decommissioned A330-300 - 1 Operating Fleet at 31 March 15 105 Slide 22 11
FLEET DEVELOPMENT - SLK No. of Aircraft Operating Fleet at 30 September 14 26 I N: Delivery of B737-800 + 3 OUT: Decommissioned A320-200 - 1 Decommissioned A319-100 - 1 Operating Fleet at 31 March 15 27 Slide 23 FLEET DEVELOPMENT - SCOOT No. of Aircraft Operating Fleet at 30 September 14 6 I N: Delivery of B787-9 + 2 OUT: Decommissioned B777-200 - 2 Operating Fleet at 31 March 15 6 Slide 24 12
GROUP CAPI TAL EXPENDI TURE FY15/ 16 FY16/ 17 FY17/ 18 FY18/ 19 FY19/ 20 Aircraft 2,750 2,900 4,150 4,200 3,800 Other Assets 200 200 150 100 100 Total 2,950 3,100 4,300 4,300 3,900 Slide 25 GROUP FUEL HEDGI NG POSI TI ON For the period Jet Fuel Brent Oct 14 to Mar 15 Percentage hedged 65.3 0.8 (% ) Average hedged 116 100 price (USD/ BBL - Jet Fuel) Slide 26 13
BUSI NESS OUTLOOK FOR FY2014/ 15 OUTLOOK I ntense competition Geopolitical factors Economic risks Slide 28 14
MEETI NG THE CHALLENGES CHALLENGES Network FSC Service Competition Product LCC Group Portfolio Competition Geography Additional Hubs Slide 30 15
NETWORK CONNECTI VI TY SilkAir Projected capacity growth of 7% for FY14-15 over FY13-14 New destinations & frequency increase for existing destinations 4 new destinations: Kalibo, Mandalay, Hangzhou, Bali Slide 31 NETWORK CONNECTI VI TY Air New Zealand SQ – NZ alliance to launch on 6 Jan 2015 NZ to operate daily AKL-SIN vv on B772 SQ to operate daily SIN-AKL vv on A380 and daily SIN-CHC vv on B772 20% capacity increase between Singapore and New Zealand Turkish Airlines Major expansion of codeshare ties commencing May 14 Connecting passengers between SQ and TK increased more than 13,000 in the period Jun 14 – Sep 14, year-on-year Slide 32 16
NETWORK CONNECTI VI TY Codesharing enables SQ to expand its network via inorganic growth SQ Codeshare on Partner Carriers SQ Operations As at Sep14 Destinations 63 208 Weekly flight segments 1,594 6,514 Slide 33 FFP DEVELOPMENT SIA – Virgin Australia announced World’s First Loyalty Programme Conversion on 24 Sep 2014 Exclusive to the two airlines Gives members greater access to upgrades and reward seats across combined international and domestic network Slide 34 17
FFP DEVELOPMENT KrisFlyer Spree − Launched 19 Jun 2014 − Online platform where members can earn miles when they shop − Attract new KF members and increase engagement and benefits to existing ones Pay with KrisFlyer Miles − Members are able to use miles to pay for all or part of their commercial airfares, fuel surcharge, and fees. − Effective Aug 2014, miles can be used to pay for preferred seats − Minimum miles level reduced from 5,000 to 3,000 Slide 35 BRANDI NG I NI TI ATI VES Projecting the SIA Brand to a global audience through sponsorships 2014 Formula 1 Singapore Airlines Singapore Grand Prix 2014 WTA Finals Singapore Slide 36 18
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