Tiger Airways Reports Q1 2010/11 Profit

Tiger Airways Holdings Limited has reported that profit before tax, excluding foreign exchange differences, for the quarter ended 30 June 2010, the first quarter of the FY2010/11 financial year, was $7.6 million, a $20.7 million improvement over the $13.1 million loss recorded for the same quarter in the previous year.

The reported profit before tax for the quarter ended 30 June 2010 was $1.3 million, a $7.4 million improvement over the $6.1 million loss recorded in the quarter ended 30 June 2009. The quarterly result was supported by revenue growth of 45% from $100.1 million to $145.1 million, resulting from a 39% increase in passenger numbers. Growth in passenger volume outstripped seat capacity growth of 36.9%, leading to a 1.3 percentage point improvement in load factor to 84.2%.

Unit revenue as measured by Revenue per Available Seat Kilometre (RASK) increased 24.2% over the same quarter last year, signalling strong revenue momentum particularly from our Singapore business, shorter average stage length and the continuing maturity of the airlines in the group.

Due to a 14.9% reduction in average sector length in the period, unit cost as measured by Cost per Available Seat Kilometre (CASK) was 16.6% higher than the previous year. CASK excluding fuel and foreign exchange differences (controllable CASK) increased just 5.5% over the previous year despite the significant reduction in average sector length.

“Going forward, we are capitalising on the strong economic growth and visitor arrivals data out of Singapore by committing to a 40% increase in the Tiger Singapore fleet over the next six months. Four additional aircraft will support our increased frequencies to Guangzhou, Hong Kong, Jakarta, Macau and Shenzhen, and our new daily service between Singapore and Taipei,” said Tony Davis, President and Group CEO. “In addition, Tiger Airways has signed a memorandum of understanding to form a new low fare airline in Thailand with Thai Airways International. The new airline, known as Thai Tiger is expected to commence services in the first quarter of 2011.”

Recently, Tiger Airways introduced two new additional ancillary products; a priority boarding service called boardmefirst in Singapore, whilst the check-in process has been improved in Australia by offering web-based check-in facilities to those passengers travelling without baggage.

Over the coming months, Tiger’s focus will be to continue to lower the cost base, enhance the ancillary revenue stream and progress with establishing Thai Tiger.

To support its growth plans, Tiger has an additional 9 new Airbus A320 aircraft scheduled for delivery during the financial year ending 31 March 2011, and it plans to return 2 of its current aircraft to their owner at the end of their respective leases. The fleet will therefore grow by a total of 7 additional aircraft, bringing the fleet size to 26 aircraft by March 2011.

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