MEDIA/ANALYST PRESENTATION FY2006-07 RESULTS 11 MAY 2007
SIA GROUP FY2006-07 07 RESULTS
GROUP REVENUE FY2006/07 ($ million) ($ million) 15,000 14,494 14,000 13,000 12,000 11,000 10,515 12,013 13,341 Record Revenue 8.6% 10,000 9,762 9,000 8,000 5-Year CAGR + 8.4% 0 2003 2004 2005 2006 2007
GROUP EXPENDITURE FY2006/07 ($ million) ($ million) 15,000 14,000 13,000 12,000 11,000 10,696 12,128 13,180 Group Expenditure 8.7% 10,000 9,000 8,000 9,798 9,093 5-Year CAGR + 7.7% 0 2003 2004 2005 2006 2007
GROUP OPERATING PROFIT FY2006/07 ($ million) ($ million) 1,600 1,400 1,200 1,000 1,317 1,213 1,314 Operating Profit 8.3% 800 717 669 600 400 5-Year CAGR + 16.4% 200 0 2003 2004 2005 2006 2007
GROUP OPERATING PROFIT FY2006/07 ($ million) ($ million) 3,000 2,500 +1,153-677 2,000-375 1,500 1,213 1,314 101 1,000 500 Higher loads & improved yields Higher fuel spend Higher costs ex-fuel 0 2006 Operating Revenue Fuel Expenditure Ex-Fuel Expenditure 2007
GROUP FUEL EXPENDITURE FY2006/07 ($ million) ($ million) 6,000 5,000 4,000 4,240 4,917 Fuel Expenditure 16.0% 3,000 2,693 2,000 1,000 1,865 1,811 5-Year CAGR + 27.4% 0 2003 2004 2005 2006 2007
GROUP EX-FUEL EXPENDITURE FY2006/07 ($ million) ($ million) 10,000 8,000 6,000 7,933 7,282 8,003 7,888 8,263 Ex-Fuel Expenditure 4.8% 4,000 2,000 5-Year CAGR + 1.0% 0 2003 2004 2005 2006 2007
CONTRIBUTION TO GROUP OPERATING PROFIT FY2006/07 Percentage (%) 110 100 90 80 70 60 50 40 30 5.8% 11.1% 15.2% 53.6% Others SIAEC SATS SIA 4.9% 7.8% 11.7% 78.1% SIA 24.5% pts SIA Cargo 16.8% pts SATS Group 3.5% pts 20 10 0-10 14.3% -2.5% 2006 SIA Cargo 2007 SIAEC 3.3% pts
GROUP NET PROFIT FY2006/07 ($ million) ($ million) 2,500 +247 2,129 2,000 +421 1,500 1,241 +101 +119 888 1,000 500 Higher operating profit Surplus on disposal of Aircraft & Others Sale of SIA Building & SALE Tax writeback 0 2006 Operating Profit Non-Op Surpluses Exceptional Items Tax Writeback 2007
THE PARENT AIRLINE FY2006-07 07 RESULTS
THE PARENT AIRLINE COMPANY HIGHLIGHTS FY2006/07 Highlights of Company s Performance Capacity growth (+2.8%) Passengers carriage (+7.7%) Passenger load factor 79.2% (+3.6% points) Passenger yield 10.9 /pkm (+2.8%) Record revenue $11,344 million (+10.1%) Unit cost 7.9 /ask (+5.3%) Record operating profit $1,027 million (+57.8%)
THE PARENT AIRLINE COMPANY RESULTS FY2006/07 2006-07 07 2005-06 06 % Change Total Revenue 11,343.9 10,302.8 + 10.1 Total Expenditure (10,316.9) (9,651.8) + 6.9 Operating Profit 1,027.0 651.0 + 57.8
THE PARENT AIRLINE COMPANY OPERATING PERFORMANCE FY2006/07 2006-07 07 2005-06 06 % Change Passenger Yield ( /pkm) 10.9 10.6 + 2.8 Unit Cost ( /ask) 7.9 7.5 + 5.3 Passenger Breakeven Load Factor (%) 72.5 70.8 + 1.7 pts
THE PARENT AIRLINE COMPANY OPERATING PERFORMANCE FY2006/07 (Billion KM) 120 110 100 90 80 0 ASK 79.2 PLF 75.6 RPK 2006 2007 Capacity (ASK) 2.8% Passenger Carriage (RPK) 7.7% Pax. Load Factor (%) 3.6% pts
THE PARENT AIRLINE COMPANY OPERATING PERFORMANCE FY2006/07 2006-07 07 2005-06 06 % Change Passenger Load Factor (%) 79.2 75.6 + 3.6 pts Passenger Breakeven Load Factor (%) 72.5 70.8 + 1.7 pts Passenger Load Factor Spread (%) 6.7 pts 4.8 pts + 1.9 pts
THE PARENT AIRLINE COMPANY OPERATING PERFORMANCE FY2006/07 (%) 82 80 78 76 74 72 70 68 66 64 62 60 0.9 Passenger Load Factor Breakeven Load Factor 0.5 4.8 4.8 2003 2004 2005 2006 2007 6.7
THE PARENT AIRLINE COMPANY COST COMPOSITION FY2006/07 Others 22.6% (-0.8% pt) Sales Costs 6.0% (-0.7% pt) Fuel 37.6% (+2.7% pts) Airport Handling 7.3% (-0.3% pt) Aircraft Depreciation & Rental 10.2% (-0.9% pt) Staff 16.3%
THE PARENT AIRLINE COMPANY COST ANALYSIS FY2006/07 Fuel $3,881 M (+15.2%) Staff Depr, Rentals & Carrying Costs Airport Handling Sales Others $1,050 M (-2.2%) $753 M (+2.7%) $620 M (-4.1%) $1,686 M (+7.3%) $2,327 M (+3.0%) 2006-07 2005-06 0 1000 2000 3000 4000 5000 ($ million)
THE PARENT AIRLINE COMPANY FUEL COST FY2006/07 (USD/BBL) ($ million) 100 7,000 90 80 76.26 84.40 6,000 70 60 50 40 30 20 10 34.51 37.91 1,523 1,416 54.58 2,148 3,368 3,881 (+15.2%) 5,000 4,000 3,000 2,000 1,000 0 2003 2004 2005 2006 2007 0
SIA SUBSIDIARIES FY2006-07 07 RESULTS
SUBSIDIARIES NET PROFIT FY2006/07 ($ million) 2006-07 07 2005-06 06 % Change SIAEC Group 242.1 230.6 + 5.0 SATS Group 178.2 188.6-5.5 SIA Cargo 30.6 135.3-77.4 SilkAir 19.8 20.6-3.9
LOOKING AHEAD
LOOKING AHEAD Fuel Hedging Position Capital Expenditure Airbus A380 Fleet Development
GROUP FUEL HEDGING POSITION FY2007/08 Budgeted Uplift Volume (M BBL) 37 Hedging Target (%) 45 +/- 15 Percentage Hedged (%) at May 07 42 Avg Hedged Price (USD/BBL - Jet Fuel) 84
GROUP CAPITAL EXPENDITURE FOR NEXT 5 YEARS ($ million) FY07/08 FY08/09 FY09/10 FY10/11 FY11/12 Aircraft 1,800 2,300 3,500 4,800 4,500 Other Assets 600 500 500 300 300 Total 2,400 2,800 4,000 5,100 4,800
AIRBUS A380-800 800 FY2007/08 1 st unit delivery October 2007, into commercial service in November 2007 to Sydney 2 nd and 3 rd units delivery January and February 2008 for London route
PASSENGER FLEET DEVELOPMENT FY2007/08 Operating Fleet at 1 April 2007 94 Aircraft Deliveries Airbus A380-800 3 Boeing B777-300ER 5 Aircraft Sold Off Boeing B747-400 5 Operating Fleet at 31 March 2008 97
DIVIDENDS
DIVIDENDS FY2006/07 Earnings Per Share ( )( Interim Dividend Per Share Paid ( )( 2006-07 07 172.6 15.0 2005-06 06 101.7 10.0 Proposed Final Dividend Per Share ( )( 35.0 35.0 Total Ordinary Dividend Per Share ( )( 50.0 45.0
SPECIAL DIVIDEND FY2006/07 Monetization of Non-Core Assets Sale of SIA Building and of 35.5% stake in Singapore Aircraft Leasing Enterprise Total proceeds $852 Million Proposed Special Dividend 50 per share, approximately $625 Million 73% of proceeds
TOTAL DIVIDENDS FY2006/07 Total Ordinary Dividend Per Share ( )( Proposed Special Dividend Per Share ( )( 2006-07 07 50.0 50.0 2005-06 06 45.0 Nil Total Dividends Per Share ( )( 100.0 45.0
PROPOSED CAPITAL REDUCTION
PROPOSED CAPITAL REDUCTION Objectives Make capital structure more efficient Improve ROE Ensure adequate funding for operations and investments
PROPOSED CAPITAL REDUCTION Distribution to shareholders by cancellation of shares 1 1 share cancelled for every 15 shares held Cash distribution $18.46 per share cancelled 2 Approximately $1,537 million 3 1. Subject to court approval 2. Price based on average SGX closing price between 2 May and 8 May 2007 3. Estimated based on 1,249.3 million shares in issue at 8 May 2007
PROPOSED CAPITAL REDUCTION Features & Benefits All shareholders receive cash Proportion of ownership after completion remain unchanged Improve EPS
PROPOSED CAPITAL REDUCTION Features & Benefits Alternatives to be made available for odd lots, rounded up to nearest normal trading lot Details forthcoming
Singapore Airlines Limited Company Registration No.: 197200078R Further information and media releases can be found at the Singapore Airlines internet website www.singaporeair.com.sg