NWAFA just a note to advise you against joining the misguided masses who perpetually claim that Singapore Airlines has and continues to be government subsidised.
Though SIA is indeed 56.75% owned by the Singapore Government’s Investment Arm Temasek, if you look carefully and ignore the gratuitous banter, I can assure you that if anything, it is SIA that subsidises Temasek and hence the Singapore Government by means of impressive dividends derived from SIA’s not insignificant profits. SIA’s 2003-2004 profit before tax for example was SGD
$820.9-million with a dividend of approximately 25c per share.
For those unfamiliar with Temasek Holdings, it was formed in 1974 and their current portfolio, worth an estimated SGD
$90-billion, includes a diverse range of investments with many familiar companies such as SIA, Singtel, DBS Bank, Singapore Power and Bank International Indonesia coming under their influence. It is also worth noting that Temasek holds a stake in Qantas, albeit small, and was a key backer of Australian low-cost operator Impulse which was absorbed into Qantas some years ago.
Despite so many claiming that SIA’s profits and quality of its products and services are thanks to the government concessions, this is incorrect. Even a passing glance at SIA’s annual expenditure reported in their annual report will tell you that they pay market prices for fuel, human resources, landing and handling fees and sales costs. The only subject that is worthy of discussion is SIA’s ability to depreciate aircraft at a faster rate than many other airlines. However, this is thanks to Singapore’s depreciation policy and is not quite as significant as Geoff Dixon would like you to believe.