$SIA (C6L.SG)$ : How rich is Singapore Airlines ? Bear with ...

Singapore Airlines is one of the world's best airline companies. Well, that may be debatable since it has won numerous awards for actually being the best airline company.

But being the best does not always equate to being the richest or even the largest airline company.

Singapore Airlines, despite his fame, does not really match the size of some European and American Giants.

That’s simply because the market size of American and European airline companies serve a much larger and more affluent customer base as compared to Singapore Airlines.

How large Singapore Airlines is, you can look no further than its market capitalization. This is basically its value. How much is Singaporean Airlines valued according to the stock market.

Well, as of the time of writing, they are worth $14.14 billion, which is ahead of companies like Air China, China Southern Airlines, American Airlines, ANA Holdings and so on.

But they are behind Ryan Air which has a market cap of over $33 billion, more than double than that of Singapore Airlines.

Delta Airlines is also ahead with over $30 billion, followed by Southwest Airlines at $17 billion, United Airlines Holding at $15.4 billion.

Despite not being the number one, they are still a big, very big company to understand and appreciate the size of Singapore Airlines.

Let's dive into their 2022 to 2023 annual report. But one needs to understand about Singapore Airlines is about its group denoted as the SIA Group.

The SIA Group has two companies, Singapore Airlines and Scoot, its budget friendly airline Singapore Airlines for the 2022-2023 year has taken in 18.1 million passengers with 133-passenger aircrafts in operating fleet and 74-passenger destinations.

Scoot, on the other hand, had served with 55-passenger aircraft and 58 destinations. This comes out to a total of 26.4 million passengers and 188-passenger aircraft and 109 destinations.

SIA Group also has its own cargo operations known as Singapore Airlines Cargo. It currently has seven aircraft and has carried cargo and mail of about 923 million kilogrammes by performance of the full-service carrier by region, they had reported $2.6 billion from East Asia, $2.3 billion from the Americas, $2.6 billion from Europe, $2.4 billion from Southwest Pacific, and $1.4 billion from West Asia and Africa.

Let's take a look at the SIA Group's revenues. Revenues are basically what the company made from serving these passengers, bringing them to various destinations for the year.

They reported over $17.7 billion, a huge increase from the previous year of only $7.6 billion.

Their revenue of the full service carrier comes out to $11.5 billion and comes from passenger flown revenue.

Meanwhile, $3.6 billion comes from cargo and mail revenue and $455 billion comes from other businesses.

Their net profits, which is how much they made after subtracting their expenses, came out to $2.1 billion.

This expenses is about $15 billion. Staff cost comes to $3 billion, followed by fuel cost at $5 billion. Depreciation is at $2 billion.

Aircraft maintenance and overhaul cost at 527 million. Landing, parking and overflying charges at $657 million. Advertising and sales cost at $326 million and other factors.

Their taxes for the year were about $506 million so if they did not have to pay taxes, they would have ended up earning over $2.7 billion.

The company also has assets and debt. Assets is what the company owns, while debt is basically what they owe.

Assets for an airline company can be it's aircrafts, whereas debts can be loan from the banks.

Anyway, their total assets are pretty big, totalling about $49.1 billion.

$16.3 billion of which are cash and bank balances. This is what makes up a huge amount of the Group's money, just purely cash.

Their property, plant and equipment sit at $23.8 billion.

According to its official website. They have 6 aircraft fleet, the Airbus A350-900, Airbus A380-800, Boeing 777-300ER, Boeing 787-10, Boeing 737-8 and Boeing 737-800NG.

Their debts, on the other hand, is just a small sum of $15.3 billion.

As for its employee base, the SIA Group had an average number of employees of 22,819 which is quite significant. Now this employee base ranges from pilots to executive management.

Currently the chairman of the group is Peter Seah Lim Huat who is a known banker and has served on boards including DBS Bank Limited, DBS Group Holdings Limited and LaSalle College of the Arts Limited.

The current CEO and Director is Goh Choon Phong, who joined the company in 1990.

Under the SIA Group, they also have several businesses and operations. They have what is called the Singapore Airlines Academy, which is a training programme to businesses and external organisations in the areas of service excellence, operational excellence and digital innovation.

They have the Pelage, which is a travel experience platform where one can acquire anything from transportation tickets and experiences to various destinations.

They have KrisShop in Airbus Asia training centre and the SIA Engineering company. Now the SIA Engineering Company is stated to be Asia's Foremost Maintenance, Repair and Overhaul Provider.

They have 6 hangers in Singapore and 3 hangers in the Philippines. It has serviced several aircrafts and was the first MRO provider in the world to maintain the Superjumbo A380.

It was also the first in the world to convert Boeing 747-400 passenger aircraft to freighters. For the same year, it had reported revenues of $796 million.

Now let's finally discuss the stakes acquired by Singapore Airlines. The SIA Group is rich and has always been rich. They are, after all, the flag carrier of Singapore, which is one of the world's top financial hubs. It is also majority owned by Temasek Holdings, which is amongst the world's largest sovereign wealth funds.

In case you forgotten, during the COVID-19 pandemic, Singapore Airlines actually incurred massive losses.

In March of 2020, Reuters reported that Temasek had LED a $19 billion rescue of Singapore Airlines. It was reported to be the single largest financing package announced by an airline since the pandemic started for that time frame and these are no small figures, which is why the group is very confident in its future as it will always have a wealthy backer.

Throughout its history, the SIA Group has acquired several smaller or competitor airline companies, much of which, however, is through the acquisition of a stake. Now a stake is just a part of a company.

So, for instance, in November of 2022, it was announced that they would acquire a 25.1% stake in Air India under a deal with Tata. Is a significant because India is slowly becoming the world's top aviation market, which means that SIA has a lot to gain if they do succeed in pushing inside this market.

Back in 2012, it was also announced that Singapore Airlines had acquired a 10% stake in Virgin Australia. The cost was just a small sum of A$105 million.

Finally, let's compare the SIA Group to other major airlines, comparing them beyond the market value. Market capitalization, after all, is just a figure that is determined not by the company but by the market.

The market is millions of investors that trades billions of dollars. Now, market value doesn't really tell us the full story of just how big the group is, but in US$, Singapore Airlines as about US$13.97 billion in revenue.

Unfortunately, it shows just how small Singapore Airlines is. It is way below Delta Airlines revenue of $58 billion, Germany's Lufthansa at $38.9 billion and even Air France KLM at $31.9 billion. In terms of net income, Singapore Airlines has about $2.5 billion for TTM. While it is lower than Delta Air $6.4 billion, they are much higher than Ryan Air which reported $1.83 billion and even Japan Airlines at $1.16 billion.

Now let's compare them with passenger statistics. The SIA Group has taken in about 18 million people. A significant amount for sure, but it's actually lower than other major airline companies. IndiGo, a low-cost airline in India, has carried over 85 million people. Ryan Air, another low-cost airline, has over 70 million people. Lufthansa, which had nearly tripled the amount of revenue of Singapore Airlines is known as the largest airline company by passenger traffic in Europe after carrying over 101 million people in 2022.

Now, let's sum it up. Yes, Singapore Airlines is a big and very rich company, but it is not number one. However, you should know that Singapore Airlines services a growing region. While they are all across the world, they are primed to benefit from Southeast Asia's economies. This is unlike the Americas and Europe which are seeing slow economic growth or at times stagnant growth. Good thing to keep in mind.