CAPA: Southeast Asia Airlines Endure Rough & Unprofitable 2014; Outlook For 2015 Is Brighter

Of the 18 publicly traded airlines or subsidiaries/affiliates in Southeast Asia which report financial results, five saw a reduction in operating profits in 2014 – Bangkok Airways, Malaysia AirAsia, Singapore Airlines (SIA), SIA regional subsidiary SilkAir and Thai AirAsia. Another four saw their operating losses widen – Indonesia AirAsia, Malaysia Airlines (MAS), Tigerair Singapore and Thai Airways – and three swung from a profit to a loss – Garuda Indonesia, Nok Air and Malaysia AirAsia X.

The six which improved profitability were Cebu Pacific, Philippine Airlines (PAL), Philippines AirAsia, Tigerair Philippines, Garuda Indonesia budget subsidiary Citilink and SIA Cargo. The latter four remained in the red while Cebu Pacific managed an improvement in profits and PAL was the only airline to swing from a loss to a profit.

The Philippines was an exception, led by a huge improvement at Philippine Airlines

Four of the six airlines which saw profits improve are based in the Philippines, which bucked the general trend in the region as market conditions improved. The Philippine market benefitted from consolidation and capacity reductions while overcapacity plagued all the other major markets in Southeast Asia.

The consolidation included the early 2014 acquisition by Cebu Pacific of Tigerair Philippines, which Cebu Pacific was able to quickly turn around. Tigerair Philippines incurred a net loss of only USD4 million between 20-Mar-2014, the date the acquisition closed, and 31-Dec-2014. The LCC incurred a loss of about USD54 million in 2013 and a loss of about USD15 million in the first 80 days of 2014, based on figures from the Singapore-based Tigerair Group.

Philippines AirAsia acquired Zest in 2013 and the two carriers are now in the process of merging. The AirAsia Group is confident its Philippine operation can turn the corner in 2015 after narrowing losses in 2014. (Note: Philippines AirAsia financial figures include Zest.)

But by far the biggest improvement in the Philippine market and Southeast Asia overall has come at flag carrier Philippine Airlines. PAL, the last of Southeast Asia’s publicly listed airlines to report results for 2014, recently posted an operating profit of USD7 million for 2014 compared to an operating loss of USD283 in 2013. CAPA will take a detailed look at the Philippine market in an upcoming series of analysis reports, produced for CAPA Members.

Of the five main Southeast Asian markets, only the Philippines managed an improvement in market conditions and profitability in 2014. The airline sectors in Indonesia, Malaysia and Thailand were all unprofitable in 2014 after posting profits in 2013. The Singapore airline sector was profitable in 2014 but only modestly and saw a drop compared to 2013.

Thailand was set back by a prolonged period of political instability, which significantly impacted inbound demand, while Indonesia was impacted by the depreciation of the Indonesian rupiah, weaker economic growth and a presidential election. In Malaysia, the MH370 and MH17 incidents contributed to a weaker demand environment. Singapore saw a slowdown as it relies heavily on all three of these markets as well as China, which saw a large drop in outbound visitor numbers across Southeast Asia.

Asia Airline Sector Operating Profit/Loss Or EBIT (in USD) By Carrier: 2014 vs 2013 (Source: CAPA,

Rank Airline  Country             2014

operating result 


operating result 

1. Malaysia AirAsia Malaysia  $261m profit $293m profit
2. Singapore Airlines Singapore  $166m profit $197m profit
3. Cebu Pacific Philippines  $97m profit $57m profit
4. Bangkok Airways^ Thailand  $49m profit $82m profit
5. SilkAir Singapore  $24m profit $43m profit
6. Thai AirAsia Thailand  $9m profit $74m profit
7. Philippine Airlines Philippines  $7m profit $283m loss
8. Nok Air Thailand  $13m loss $36m profit
9. Citilink Indonesia  $14m loss $60m loss
10. Tigerair Philippines Philippines  $19m loss $54m loss
11. Philippines AirAsia Philippines  $22m loss $29m loss
12. SIA Cargo Singapore  $37m loss $87m loss
13. Indonesia AirAsia Indonesia  $48m loss $12m loss
14. Tigerair Singapore Singapore  $64m loss $6m loss
15. AirAsia X Malaysia  $67m loss $10m profit
16. Malaysia Airlines^ Malaysia  $303m loss* $107m loss*
17. Garuda Indonesia Indonesia  $419m loss $86m profit
18. Thai Airways^ Thailand  $523m loss $95m loss
TOTAL   $916m loss $145m profit

Tigerair Philippines Rebrands to Go Air

tiger air
Soon to be called Go Air

BUDGET CARRIER Southeast Asian Airlines, Inc. (SEAir), which operates under the brand Tigerair Philippines, has applied for regulatory approval for a change in corporate name, a Civil Aeronautics Board (CAB) official told reporters last week.


Wyrlou E. Samodio, who heads CAB’s Legal Division, said the company had applied to change its corporate name to Go Air, Inc.

“I would assume that they applied for change of name because there’s a new owner. That’s the supposition there,” he said in Filipino.

Last month, Gokongwei-led Cebu Air, Inc. — operator of budget airline Cebu Pacific Air — completed its $15-million acquisition of Tigerair Philippines operator SEAir from Singapore-based Tiger Airways Holdings, Inc. — through subsidiary Roar Aviation II Pte. Ltd. — and other shareholders.

Menchie V. Osial, Tigerair Philippines media contact, said the company has already secured CAB approval. “Only got approval from CAB; still waiting for SEC (Securities and Exchange Commission) approval — probably next week,” she said in a text message.

Asked on possible rebranding, Ms. Osial replied: “We’re not saying we’ll retain it; it’s still under study and review,” adding that a decision could be reached in August. 


Source: AJ M. Santos,