Tiger Airways has posted losses for the fourth quarter and full financial year, as a reduction of costs failed to match the loss of revenue experienced following the divestment of Tigerair Australia.
The low-cost airline group suffered an operating loss of SG$24.2 million (US$19.3m) for Q1 2014, compared to a profit of SG$12.7m in the same period last year. Revenues declined 32.7% to SG$161.9m, mainly due to the removal of Tigerair Australia from the figures, after a 60% stake in Melbourne-based subsidiary was sold to Virgin Australia last year. But company expenses only fell 18.3% to SG$186.1m.
For the full-year ended 31 March 2014, Tiger posted an operating loss of SG$52.0m, compared to an operating profit of SG$7.3m in the previous 12-month period.
The group is now adjusting its regional strategy, having sold 60% of its stake in Tigerair Australia and 40% of Tigerair Philippines. It is also expected to sell its troubled Indonesian unit, Tigerair Mandala. But the company has also teamed up with China Airlines for a new low-cost carrier in Taiwan, which is expected to launch by the end of 2014.
“In the past year we have executed difficult plans to clear the deck and put the group on a stronger foundation,” said Tiger’s group CEO, Koay Peng Yen. “The divestment of our overseas units and provisions for future charges ensure that the company can start off on a better footing in the new financial year.”
Tiger said its focus for the remainder of the year was on “managing costs and productivity, optimising yields and… reducing capacity”.