SQ rebuilds route network

SINGAPORE, 10 February 2021: Singapore Airlines has reinstated services to Dubai, Moscow and Munich, while it will launch its first flight to Phuket under the SQ brand, 4 March, when the route to the popular Thai island destination transfers from SilkAir to SIA.

In its looking forward notes attached to its financial results for the third quarter ending 31 December SIA forecasts that by April total passenger capacity will level out at around 25% of pre-Covid-19 levels. Based on current schedules, the group expects to serve around 45% of the destinations that it served before the crisis.

The integration of SilkAir’s operations with Singapore Airlines will begin in earnest 4 March 2021, when the first SIA 737-800 NG aircraft operates on the route to Phuket. SIA said the merging of Silk Air into the parent airline should  “deliver greater economies of scale for the group and allow it to deploy the right aircraft to meet the demand for air travel as it returns.”

The group fleet currently consists of 185 aircraft. The passenger network is currently supported by about 64 aircraft. All seven freighters are fully used, and around 24 passenger aircraft are deployed on cargo-only services.

The airline parked 123 aircraft, including the 33 surplus aircraft that were impaired in the first half of the year. More aircraft will be re-introduced into the operating fleet as the network gradually revives to pre Covid-19 levels.

During the third quarter ending 31 December 2020, SIA served 38 destinations up from 31 at the end of September 2020. SilkAir increased the destinations served to eight, up from six, while Scoot’s network remained unchanged with 17 destinations. By the end of December, the group’s passenger network covered 54 destinations including Singapore, compared to 43 three months ago.

SIA is the first airline in the world to offer a new pilot service for the digital verification of Covid-19 test results and vaccination information. This is based on IATA’s Travel Pass framework, which aims to allow travellers to easily and securely manage their travel. SIA also partnered with Collinson to pilot a one-stop online solution for Covid-19 pre-departure testing for passengers, as part of our ongoing efforts to provide customers with a more seamless travel experience.

The aviation sector in Singapore has been given priority in the country’s vaccination exercise. This reflects the sector’s importance and the crucial role that SIA Group plays in both Singapore’s economic recovery and the fight against the Covid-19 pandemic. More than 90% of the operating crew in all three airlines have signed up for the vaccination.

On the financial front, fund-raising efforts in the first nine months of the year continue. SIA issued its first USD-denominated bond in January 2021 raising USD500 million (or SGD666 million). To-date, SIA has successfully raised approximately USD13.3 billion in additional liquidity since the beginning of the financial year. Discussions on sale-and-leaseback transactions are at an advanced stage.

SIA continues to have access to more than USD2.1 billion in committed credit lines, along with the option to raise up to USD6.2 billion in additional mandatory convertible bonds before the Annual General Meeting in July 2021.

As for the future, the airline warned that the resurgence of Covid-19 infections as well as the spread of more transmissible strains of the virus continue to weigh on international air travel, as border controls and travel restrictions tighten in many countries.

“But in line with Singapore’s progressive re-opening, the group expects to see a measured expansion of the passenger network over the coming months.”

Reporting its financial results for April to December 2020, SIA Group confirmed the operating loss for the nine months to December 2020 stood at SGD2,194 million, a reversal of SGD3,056 million from the profit of SGD862 million for the same period last year, as travel demand deteriorated sharply since the start of the financial year.

For the full report on the financial results to the end of the third quarter see: https://www.singaporeair.com/saar5/pdf/Investor-Relations/Financial-Results/SGXNET/bu-q3fy2021.pdf