Singapore Airlines has a net loss of nearly 3.5 billion yuan in the second fiscal quarter



        Lianhe Zaobao reported on November 7: The coronavirus outbreak has led to a sharp drop in passenger traffic. Coupled with the devaluation of retired passenger aircraft, Singapore Airlines (SIA) has a net loss of 2.343.7 million yuan in the second fiscal quarter, setting a new quarterly net loss record. . Coupled with the loss in the first fiscal quarter, the group's net loss in the first half of the fiscal year was 3.467 billion yuan, more than market expectations.


   Based on significant losses and in order to retain cash, Singapore Airlines’ board of directors recommends not to distribute interim dividends.


   Singapore Airlines announced its second-quarter and first-half results as of the end of September after the market closed on Friday (6th). The total revenue for the first half of the year fell by 80.4% to 1.634.4 million yuan. On the other hand, the total expenditure was reduced by 55.8% to 3.497.3 million yuan under the adoption of extensive cost-cutting measures, including reducing transportation capacity, renegotiating contracts, employee-related measures and government assistance. Compared with the net profit of 205.6 million yuan in the same period last year, the net loss in the first half of this year was as high as 3.672.6 million yuan.


   Performance plummeting In addition to the sharp drop in passenger traffic caused by the epidemic, the Group also made a non-cash impairment of 1.333 million yuan for the retirement of 26 old-generation passenger aircraft in the second quarter. Including the impairment of seven airliners made during the liquidation of Thai joint venture NokScoot Airlines in the first quarter, the airline's impairment in the first half of the year reached 1.449 billion yuan.


   Due to reduced transportation capacity and lower fuel prices, the Group’s pre-hedging fuel cost in the first half of the year fell by 91% to 218 million yuan, but due to a loss of 158 million yuan in fuel hedging, the net fuel cost reached 376 million yuan. In addition, the loss of ineffective fuel hedging reached 563 million yuan. The group stopped fuel hedging in March this year.


         The passenger traffic of the group's Singapore Airlines, SilkAir and Scoot have all fallen due to international passenger restrictions. However, due to the efforts of various countries to restore the operation of the global supply chain, the cargo operation revenue increased by 200 million in the first half of the year. 74 million yuan, an increase of 28.3%. The group also maximized the use of cargo planes in response to demand and used passenger planes for cargo. It expects that freight demand will be stimulated by the peak e-commerce sales season and the launch of new products.


         The  Group also revealed that it has completed negotiations with Airbus to adjust the delivery schedule of the new passenger aircraft and delay the delivery of some ordered passenger aircraft. As for the negotiations with Boeing, they are at an in-depth stage, and the results of the negotiations will help ease the group's short-term passenger aircraft delivery.


   Singapore cautiously reopens borders Singapore Airlines: seize revenue opportunities


  The group emphasized that it is ready to seize revenue opportunities in the process of reopening the border safely and cautiously in Singapore. A stable balance sheet and transformation plan will also lay a solid foundation for it to lead the market in the new normal after the epidemic. Although the global epidemic has caused the aviation industry to recover continuously, the group said that it has observed signs of customers' confidence in flying.


   From the end of June to the end of September, Singapore Airlines increased its number of destinations from 24 to 30, SilkAir from three to five, and Scoot from six to 16. Overall, the group’s passenger transport network has increased from 32 locations in June to 43 locations at the end of September. As for the freight network, it has increased from 26 cities at the beginning of April to 61 cities at the end of September.


   Singapore Airlines resumes direct flights to New York next Monday (9th), reconnecting passenger and cargo routes between Singapore and the East Coast of the United States. In the next few months, Singapore Airlines and SilkAir will resume flights between Brunei, Dhaka, Fukuoka, Johannesburg, Kathmandu, Male and Penang. Scoot will also resume flights to Melbourne.


   The stock price of the group closed at RMB 3.48 on Friday, up 0.28%.