What does SIA's latest FY results say about the Local Aviation Industry?
1. Passenger traffic is recovering but revenue per passenger is not strong. Passenger business could be facing higher expenses, competitive airfares from regional peers, and lack of demand for long-distance travel. Perhaps, the recent disruption in Chinese routes is slowing their recovery.
2. Cargo business is doing very well, that means the oldest planes in SIA are the ones making money for SIA. It is less efficient to use the bottom of passenger planes to fly cargo, and SIA continues to purchase new passenger planes, so the depreciation is likely to remain high.
3. Did SIA close some of their oil futures positions (various, till March 2025)? With current oil prices, the lack exceptional paper gains from their oil-hedge, hints that SIA either closed some of these positions at lower prices, or they didn't manage to impose much fuel-surcharges on their passenger/cargo business. https://www.reuters.com/article/us-singapore-air-results-idUSKBN22Q1GL
Interest rates will be higher in the years ahead, so it will erode SIA's margins if they refinance their debts. It will be cheaper for SIA to have another rights issue to strength their balance sheet.
1. Passenger traffic is recovering but revenue per passenger is not strong. Passenger business could be facing higher expenses, competitive airfares from regional peers, and lack of demand for long-distance travel. Perhaps, the recent disruption in Chinese routes is slowing their recovery.
2. Cargo business is doing very well, that means the oldest planes in SIA are the ones making money for SIA. It is less efficient to use the bottom of passenger planes to fly cargo, and SIA continues to purchase new passenger planes, so the depreciation is likely to remain high.
3. Did SIA close some of their oil futures positions (various, till March 2025)? With current oil prices, the lack exceptional paper gains from their oil-hedge, hints that SIA either closed some of these positions at lower prices, or they didn't manage to impose much fuel-surcharges on their passenger/cargo business. https://www.reuters.com/article/us-singapore-air-results-idUSKBN22Q1GL
Interest rates will be higher in the years ahead, so it will erode SIA's margins if they refinance their debts. It will be cheaper for SIA to have another rights issue to strength their balance sheet.
