Singapore Airlines Group on Tuesday reported its highest ever net profit and outlined various strategic initiatives, including the proposed merger of Vistara with Air India to boost the Singaporean carrier's presence in the Indian market.
Vistara is a joint venture between Singapore Airlines and Tata Group, which holds 51 per cent stake. The process to merge Vistara with Air India is underway.
On Tuesday, Singapore Airlines (SIA) Group posted a record net profit of 2,157 million Singapore Dollars for FY2022-23. In the year-ago period, it had a net loss of SGD 962 million.
"This was mainly driven by better operating performance (+SGD 3,302 million) and lower net finance charges (+SGD 338 million), and partially offset by a tax expense versus a tax credit last year (around SGD 615 million)," the airline group said in a release.
Despite the Covid pandemic, the group said it remained committed to its longstanding strategy of buying and operating new generation aircraft. Among other efforts, the group did the retrofit of its Airbus A380 and Boeing 737-8 aircraft and placed an order for the all-new Airbus A350F freighters.
"To prepare for the future, several strategic initiatives were undertaken, including the continued expansion of its network through deeper collaboration with like-minded airlines, the proposed merger of Air India and Vistara to bolster SIA's presence in the fast-growing Indian aviation market, as well as Scoot's decision to lease nine Embraer E190-E2 aircraft and expand its footprint to secondary points in the region," the release said.
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India is the world's third largest market as well as one of the fastest growing aviation markets.
On November 29 last year, Tata Group announced the merger of Vistara with Air India under a deal wherein Singapore Airlines will also acquire a 25.1 per cent stake in Air India.
Tata Group has four airlines -- Air India, Air India Express, Vistara and AIX Connect.
AIX Connect, earlier known as AirAsia India, is set to be merged with Air India Express.
According to SIA Group, geopolitical and macroeconomic uncertainties as well as high cost inflation could pose challenges for the airline industry in the months ahead.
"Even though fuel prices have moderated in recent months, they remain at elevated levels. As competition is expected to increase with more capacity being injected on international routes, the Group will monitor developments closely, and be agile and nimble in its response," it added.
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