The low-cost unit has proved quite expensive for SIA in the past, reducing the group’s profits by SG$126m (US$95m) in 2013-14. But Tigerair’s separation into its own business unit, along with lower fuel costs, boosted SIA’s operating profit by 58% to SG$410m (US$310m) for the 12 months ending 31 March 2015.
And even excluding the impact of Tigerair from the results, SIA’s full-year group operating profit still increased 17%.
Revenue dropped marginally (-0.2%) to SG$15.21 billion, although passenger revenue increased 0.9%. But the group managed to cut its expense bill by 1.3% to SG$14.97bn, including a SG$263m reduction of its fuel costs. This could have been greater, but unfortunately SIA hedged 66% of its jet fuel supply at an average price of US$117 per barrel, before prices tumbled.
By unit, national carrier Singapore Airlines generated operating profits of SG$340m in 2014-15, while SilkAir generated SG$41m. The group was hit by a SG$22m loss suffered by its cargo unit.