Overall passenger carriage was also lower by 99.3%.
Singapore Airlines’ (SIA) group passenger capacity plunged 95.1% YoY in June, according to a filing. Overall passenger carriage was also lower by 99.3%, resulting in a group passenger load factor (PLF) of 12.2%, a decline of 74 percentage points (ppt) YoY.
This is attributed to the lower demand for air travel as border controls and travel restrictions remained in place around the world.
According to the announcement, SIA’s capacity was 94% YoY lower compared to 2019, with only a skeletal network in operation connecting Singapore to 24 metro cities. Passenger carriage declined 99.1% YoY, resulting in a PLF of 12.4%.
Its units also experienced a decline, with SilkAir's passenger carriage plummeting 99.7% YoY against a 99.3% cut in capacity, as PLF stands at 36.6%. During the month, SilkAir only operated flights to Chongqing, Kuala Lumpur and Medan.
In addition, Scoot’s passenger carriage declined 99.8% YoY against a contraction in capacity of 97.5%, which led to a PLF of 7.7%. During the month, Scoot temporarily ceased operations to West Asia and Europe, whilst maintaining flights to Hong Kong and Perth, and adding flights to Ipoh, Penang, and Kuching.
However, cargo load factor (CLF) saw an increase of 25.1 ppt as the capacity contraction of 61.2% YoY outpaced the 44.1% decline in cargo traffic. Capacity contraction would have been much greater, save for the deployment of passenger aircraft on cargo-only flights.
SIA notes that the pandemic continues to have a severe impact on international air travel. Progress towards a global lifting of border controls and travel restrictions, which could facilitate or result in the easier movement of travellers between countries, is slower than earlier expected. This is said to have a material impact on the group’s revenue generation capability in FY2021.
Industry experts, including IATA and ICAO, have continued to revise downwards their projections for the recovery of global passenger traffic in the near term. Industry forecasts currently expect that it will take between two to four years for passenger traffic numbers to return to pre-pandemic levels.
In addition, the lower capacity projection reduces expected fuel consumption, causing more fuel hedges to be deemed ineffective under applicable financial reporting standards.
Despite this, the group notes that the completion of the rights issue in June strengthened its financial position by reducing its financial gearing and increasing its liquidity. The group said it continues to actively pursue cost management measures and options to conserve cash, and retains the flexibility to raise further liquidity as necessary.
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