Helped by high trolley ‘lolly’ sales such as food and drinks in-flight, and a tax credit against earlier losses in Australia, Tiger Airways has posted a net profit after tax of $SIN 28.2 million for the combined operations of its Singapore and Australia operations in the full year to March 31.
Tiger Airways president and group CEO Tony Davis tonight told a press conference that the annual results, its first as a listed company, represented a third profitable year for the Singapore division, and a break even operational result for Australia following two years of losses.
However he said Tiger in Australia had been profitable for the last three of the four quarters of its parent’s March 31 financial year, and if it had not been for fuel hedging losses its annual profit would have been around $10 million. (All figures are in Singapore dollars).
Davis also said “Following the break even result from Tiger Australia, we have recognised 50% of the Australian deferred tax asset. The balance remains available for offset against future year’s profits. “
The metrics most likely to be given careful consideration by Tiger’s rivals, Virgin Blue, Qantas and Jetstar, were a group average fare that declined from $S103.50 to $80.50, ancillary sales per passenger that rose from $15.90 to $19.30 and a revenue load factor of 85.1% which is 5.7 points higher than for the previous year.
The cost per available seat kilometre across the group fell by 11.4
With almost equal sized fleets of A320s, 10 in Singapore and nine in Australia, the fact that Tiger refuses to give an Australia-only set of these figures is rendered less obstructive because each division is very similar in size.
The accounts show that Tiger tracking better than the modest net profit after tax figures suggest, in that they were held down by IPO costs, unfavourable fuel hedges and operating losses earlier in the year.
Davis said “Our Australian competitors give a lot of huff and puff and beating of their chests about us, but at the end of the day neither can match us in costs.
“We are a serious competitor.”
He said Tiger Airways was unmoved by Jetstar’s announced plans to fly long haul wide-bodied jets out of Singapore to Australia, Europe and North Asia. “We can’t see any cost benefits that we can realise doing that against other major international long haul carriers,” he said.
“But there is so much more we can do with our single aisle fleet in Singapore, Australia, India and other parts of Asia.”
However while it had closed off the long haul option being pursued by Jetstar, Tiger had not ruled out a future direct investment offer on the ASX for investors wishing to participate in its Australian division , although Davis made it clear no such offer was being contemplated at this stage.
The Tiger Airways Holdings Limited complete filing can be found on the Singapore Stock Exchange site by going to listed companies and then Company announcements.