Although the aviation industry in the financial year 2001-02 was
adversely affected by a slowdown in the global economy, exacerbated by the
catastrophic events in the United States on September 11, 2001, the SIA Group
achieved a pre-tax profit of $926 million.
The Group’s operating profit dropped 27.0% (-$363 million) from the
previous year to $983 million. Revenue declined 5.1% (-$504 million) to $9,448
million. Expenditure was 1.6% lower (-$140 million) at $8,464 million. No
provision for profit-sharing bonus was made, compared to a payment equivalent to
4.54 months’ salary amounting to $390 million, and an ex-gratia bonus payment of
$135 million, last year. Expenditure was also reduced by $275 million from a change
in aircraft depreciation rate (SIA : $265 million, SilkAir : $10 million).
The fall in Group operating profit was due mainly to relatively poorer
performances by the Company (-$426 million) and SIA Cargo (-$82 million). The
SIA Engineering Company (SIAEC) and Singapore Airport Terminal Services (SATS)
and their respective subsidiaries recorded higher profits of $87 million and $72
million respectively. SilkAir, helped by the change in aircraft depreciation rate,
made an operating profit of $17 million, compared to a loss of $6 million the year
The Group’s profit before tax was $926 million, down 51.4% (-$979
million). Apart from the decline in operating profit, the drop was also attributable
(i) lower surplus on disposal of aircraft, spare engines and spares
(ii) share of losses of associated companies of $66 million (versus
share of profit of $82 million in the previous year), mostly from
Air New Zealand and Virgin Atlantic;
(iii) a provision of $267 million for diminution in value of
investment in Air New Zealand following the release of its
results for the financial year ended 30 June 2001, and further
losses (NZ$350 million) arising from the closure of its wholly
owned subsidiary, Ansett Australia; and
(iv) the profit of $440 million from sale of 13.0% vendor shares in
SATS and SIAEC in the previous financial year (on 5 May 2000).
A deferred gain of $203 million on divestment (in June 1998) of
SIAEC’s 51.0% equity interests in Eagle Services Asia (ESA) was recognised. The sale
of the remaining shareholding in Equant N.V. yielded a profit of $30 million.
Profit attributable to shareholders at $632 million was 61.1% (-$993
The Group’s profit before tax and exceptional items (provision for
diminution in value of investment in Air NZ, deferred gain on divestment of ESA,
profit on disposal of shares in Equant N.V., profit from the IPOs of SATS and SIAEC
and ex-gratia bonus payment in the previous year), was $960 million, a 40.0% drop
(-$640 million) against last year’s $1,599 million.
The Group’s basic earnings per share (based on weighted average
number of fully paid shares in issue after accounting for share buyback and
cancellation of 2,054,000 shares since 1 April 2001) decreased 60.9% (-80.8 cents)
to 51.9 cents.