Tiger Airways Reports Q2 Profit

Tiger Airways Holdings has reported a net profit after tax for the quarter ended 30 September 2010 of $14.1 million, a $16.4 million improvement over the $2.3 million loss recorded for the same quarter in the prior year.

Revenue growth of 35.4% from $106 million to $143.5 million was ahead of passenger growth of 25.3%, resulting in a 10% net profit margin for the quarter.

The growth in passenger volume outstripped seat capacity growth of 21.9%, leading to a 2.4 percentage point improvement in load factor to 87%.

Unit costs continue to be controlled, with total Cost per Available Seat Kilometre (CASK) down 3.1% on the same quarter last year, whilst total cost per seat was in line with the prior corresponding quarter. Cost per seat excluding fuel and forex increased due to exceptional operational disruption costs.

Net profit after tax for the half year ended 30 September 2010 was $16 million, a $24.3 million improvement over the $8.3 million loss recorded in the first half of the prior financial year.

Tony Davis, President and Group CEO, said: “We are pleased with the second quarter results posted by the Group. Achieving a 10% net profit margin, 35% revenue growth and lower unit costs, on significant capacity growth of 22% is a solid result.

“During the quarter, Tiger Airways Singapore experienced technical issues with two of its aircraft which resulted in a number of flight cancellations and the airline incurring exceptional disruption costs.

“Forward bookings remain strong, particularly for the peak travel period between December and February. To capitalise on this peak period, Tiger Airways Australia is increasing its fleet to 12 aircraft by the financial year-end.

“The airlines continue to focus on maximising profitability through the generation of additional ancillary revenue streams. In percentage terms, Tiger Airways is currently the fifth highest generator of ancillary revenue globally, and our aim is to be in the world’s top three airlines. During the quarter, we introduced two new ancillary products – boardmefirst, our priority boarding service, and our new flexible ticket option. Both products have been popular with our passengers. In addition, we have recently introduced Stripes, a membership programme that provides members priority access to promotions and the lowest fares ... We continue to work with Thai Airways on the establishment of our low cost business in Thailand, to be called Thai Tiger.”

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