Singapore Airlines Group, which includes Singapore Airlines (SIA) and Scoot, posted the highest-ever half-year operating profit of $876.1 million and a net profit of $927 million. The Group reported an increase of 12% in the cargo revenue reaching up to $1.49bn and the total group revenue was $5,975bn.
SIA was quick to undertake various initiatives like proactive fundraising, talent retention, and resource deployment in preparation for the recovery of air travel, which put the Group in a strong position to capture the pent-up demand.
Singapore Airlines and Scoot were among the first carriers to launch flights and start sales, with strong support from stakeholders. Both airlines carried thirteen times more passengers, 11.4 million in 1H of FY22-2023 resulting in passenger revenue of $4.25bn. This was mainly due to the surge in travel demand after Singapore fully reopened to vaccinated travelers in April 2022 and the easing of border restrictions across many key markets. The Group’s passenger capacity rose to an average of 68% of pre-pandemic levels in the second quarter of FY2022/23.
The Group recorded an operating cash surplus of $2,514 million for the first half, a year-on-year improvement of $2,620 million. The strong performance in the first quarter continued in the Q2 of FY22-23 with robust air travel demand due to the peak summer season. The Group recorded an operating profit of $678 million for the second quarter, an increase of $122 million from the previous quarter. This is the highest quarterly operating profit in the Group’s history
Group's revenue rose $560 million (+14.3%) quarter-on-quarter to $4,488 million, which is the highest quarterly revenue for the Group. Passenger-flown revenue increased by $627 million to reach $3,303 million as traffic grew 22.0%, outpacing the 11.3% expansion in capacity. The Group posted a net profit of $557 million for the second quarter, an increase of $187 million from the previous quarter.
As of 30 September 2022, the Group's cash and bank balances saw an increase of $3.7 billion to $17.5 billion, primarily due to net cash generated from operations including the proceeds from forward sales. Total debt balances increased by $0.1 billion to $15.8 billion, mainly due to the increase in lease liabilities as a result of sale-and-leaseback activities.
In addition to the cash on hand, the Group retains access to $2.2 billion of committed lines of credit, all of which remains undrawn.
SIA and Scoot raised a further $865 million in October 2022 and early November 2022 through the completion of aircraft sale-and-leaseback transactions for six 737-8, two 787-8, and two 787-9 aircraft. This is part of the Group’s strategy to manage the residual value risk on its fleet of aircraft, while also providing flexibility in fleet planning.
Going ahead, the Group predicts a strong demand towards the year-end peak travel season. With the recent relaxation of border controls in parts of East Asia, SIA expects the demand to pick up in Hong Kong, Taipei, and points in Japan, especially over the holiday period. Forward sales are expected to remain buoyant in the coming months leading up to the Lunar New Year period.