Cargo flown revenue was marginally lower than a year before, declining $1 million (-0.2%) to $541 million. Overall air cargo demand remained buoyant, supported by strong e-commerce flows and increased demand for air freight driven by the Red Sea crisis and port congestion. This helped to raise cargo load factor to 57.7% (+5.9 percentage points) and mitigate the impact from lower cargo yields (-19.1%) due to increased belly hold cargo capacity.
Group expenditure rose by $523 million (+14.0%) to $4,248 million, with fuel and non-fuel expenditure increasing by $317 million (+30.1%) and $206 million (+7.7%) respectively. Net fuel cost increased to $1,370 million, mainly due to higher volumes uplifted (+$147 million), an 8.1% increase in fuel prices (+$105 million), and a lower fuel hedging gain (+$52 million). The 7.7% rise in non-fuel expenditure was less than the 11.6% increase in overall passenger and cargo capacity.
As a result, the Group’s operating profit for the quarter declined by $285 million (-37.7%) from the previous year to $470 million. In addition to the weaker operating performance, a reduction in net interest income (-$22 million), lower surplus on disposal of aircraft, spares, and spare engines (-$8 million), and lower share of profits of associated companies (-$6 million) contributed to the decline in the Group net profit to $452 million (-$282 million or -38.4%). This
decline was partially mitigated by a lower tax expense (+$41 million).
Balance Sheet
As of 30 June 2024, the Group shareholders’ equity decreased to $15.1 billion, down $1.3 billion from 31 March 2024, largely due to the redemption of all remaining Mandatory Convertible Bonds (MCBs). Total debt balances remained almost flat at $13.3 billion (-$0.1 million). As a result, the Group debt-equity ratio increased from 0.82 times to 0.89 times.
Cash and bank balances fell by $1.2 billion to $10.1 billion, mainly due to the redemption of all remaining MCBs. The accreted principal amount of $1,744.6 million was paid out on 24 June 2024. This was partially mitigated by the $1.2 billion of net cash generated from operations, which included proceeds from forward sales. On top of the cash on hand, the Group has access to $3.3 billion of committed lines of credit, all of which remain untapped at present.
FLEET AND NETWORK DEVELOPMENT
As of 30 June 2024, the Group’s operating fleet comprised 202 passenger and freighter aircraft with an average age of seven years and four months. In the quarter, SIA added one Airbus A350-900 in April 2024, bringing its fleet to 143 passenger aircraft and seven freighters. Scoot added two Embraer E190-E2 aircraft in April 2024, bringing its fleet to 52 passenger aircraft2. The Group has 88 aircraft on order.
SIA began services to Brussels (Belgium) in April 2024 and London Gatwick (the United Kingdom) in June 2024, while Scoot began Embraer E190-E2 operations to Koh Samui (Thailand) in May 2024 and Sibu (Malaysia) in June 2024. As of 30 June 2024, the Group’s passenger network covered 125 destinations in 36 countries and territories4.
SIA served 78 destinations and Scoot served 69. The cargo network reached 129 destinations in 37 countries and territories. In June 2024, SIA announced plans to launch daily flights between Singapore and Beijing’s Daxing International Airport from 11 November 2024, pending regulatory approvals. SIA will also increase its frequency to Beijing Capital International Airport to 21 weekly services from 5 August 20245. As a result, SIA will operate 28 weekly services to China’s capital city, reflecting its firm commitment to this key market.
Scoot will serve Subang (Malaysia) from September 2024, and is looking to add more new services in the coming months with its E190-E2 aircraft, which enables it to reach additional non-metro destinations in the region.
STRATEGIC INITIATIVES
The proposed merger of Air India and Vistara remains on course, with the Indian National Company Law Tribunal granting its approval in June 2024. The transaction remains subject to Indian foreign direct investment approval. When completed, the merger will give SIA a 25.1% stake in an enlarged Air India Group with a significant presence in all key segments of the Indian airline market. This strategic move will bolster the Group’s presence in India, strengthen its multi-hub strategy, and allow it to maintain its direct involvement in this large and rapidly-growing aviation market.
The Group continues to pursue deeper win-win commercial partnerships with like-minded carriers, particularly in fast-growing markets within the Asia-Pacific region.
In July 2024, SIA and Garuda Indonesia received the Competition and Consumer Commission of Singapore’s approval for their commercial joint venture agreement. This paves the way for a deeper strategic alliance that potentially includes joint revenue-sharing flights between Singapore and Indonesia, coordinated flight schedules to offer travellers more options and seamless connectivity between the two countries and beyond, and joint sales and marketing initiatives to deliver greater value to customers of both airlines.
SIA and Riyadh Air, an ambitious full-service carrier from Saudi Arabia that aims to begin operations in 2025, signed a strategic partnership in June 2024. This aims to explore opportunities for greater connectivity on each other’s services, and to work on other potential areas of commercial cooperation.
Supporting its commitment to embed sustainability in all aspects of its operations, SIA signed a Memorandum of Understanding with Cathay Pacific Airways in June 2024 to collaborate on various sustainability initiatives. This includes promoting the development and use of sustainable aviation fuel (SAF) in the Asia-Pacific region, and exchanging best practices to boost sustainability performance. This collaboration underscores both airlines’ commitment to achieving net zero carbon emissions by 2050, and their shared goal of fostering industry-wide change
