MIAMI – Singapore Airlines (SQ) posts a hefty loss of US$3.22bn (SGD4.3bn) as a result of what the airline calls “the toughest year in its history.”

Passenger traffic sloped down by 97.9% in RPK (Revenue Passenger Kilometer), an almost total stop in passenger activity, as a consequence of the global travel restrictions brought in by the Covid-19 pandemic. Fortunately, cargo activity partially dampened the failing passenger revenue. On top of the traffic-linked loss, SQ suffered a non-cash impairment linked to the removal of 45 older aircraft.

The SQ group revenue for the Fiscal Year 20/21 decreased by 76.1% year-on-year from US$9.13bn (SGD12.16bn) to US$2.86bn (SGD3.81bn) resulting from the plunge in revenue at SQ, SilkAir (MI), and Scoot (TR), the three airlines belonging to the group. The loss was in part offset by cargo revenue which posts an increase of 38.8%, rising by US$569m (SGD758m) to US$2.03bn (SGD2.409bn).

The increase in cargo revenue was made possible by an improved freighter utilization, the use of passenger aircraft on cargo-only flights by removing seats and creating additional space for cargo and palliate the lack of aircraft belly space following wide cancellation of services.

This allowed the airline to take full advantage of a rising cargo space demand, linked to transportation of e-commerce parcels, pharmaceuticals, or personal protection equipment.

SilkAir Boeing 737-800 9V-MGN. Photo: Alberto Cucini/Airways


The SQ group posted an expenditure at $4.75bn (SGD6.32bn), a decrease of US$7.19bn (SGD9.588bn) or 60.2%, the net fuel cost by 78.1% to US$762m (SGD1.016bn)due to capacity cuts and lower fuel prices in the first half of the financial year. Non-fuel expenditure was reduced to US$.82bn (SGD5.099bn) due, to capacity cuts, cost-saving initiatives, savings on staff and government support.

The operating loss posted by SQ stands at US$1.886bn (SGD2.513bn) against a profit of US$44.2m (SGD59m) recorded in the fiscal year 2019/2020. The Group net loss for FY 20/21, which ended on March 31, is reported at US$3.205bn (SGD4.271bn) with a deterioration of US$3.04bn (SGD4.059bn) compared to last year.

The origin of this loss stems from a weaker operating performance, and non-cash impairment charges, due to the alienation on 45 older aircraft, partially offset by a US$467.5m (SGD623m) increase in tax credit.

Scoot Boeing 787-8 Dreamliner 9V-OFK. Photo: john Levaiditis/Airways

Fleet and Network

SQ Group fleet stands at 162 passenger aircraft and seven freighters. The number excludes 41 aircraft, considered surplus in regard to the Group’s requirement, 8 Boeing 737 Max 8 which are temporarily withdrawn from service, one Airbus 330, and one 320 that are being returned to the lessor.

In regard to its network, SQ Group expanded it in a calibrated manner and resumed services to some destinations or adding frequencies. Transfer of single-aisle services from MI to SQ began on March 4, SQ served 47 destinations up from 38 recorded at end of December 2020.

SilkAir served five destinations, down from eight, while TR network included 60 destinations with an increase of six compared to the end of December. SQ cargo covered 72 cities with an increase of 6 services.

Considering the current schedule, by June, the SQ Group foresees the passenger capacity to stand at 28% of pre-covid levels with an increase at 32% by July and expects to fly to approximately 49% of destinations served before the crisis.

The SQ Group considers that, notwithstanding mass vaccination programs presently in progress, the future projections on the global airline industry remain uncertain. The domestic market begins to recover in certain countries but international travel remains restricted and recovery is yet a mystery.

Featured image: Singapore Airlines Airbus 350-900 9V-SMH. Photo: Alberto Cucini/Airways