<![CDATA[Demand for Hong Kong flights has 'stabilised', says Singapore Airlines boss Goh Choon Phong]>

Singapore Airlines on Wednesday said the continuing anti-government unrest in Hong Kong had left only a "relatively minor" dent in its financial performance amid concerns in the region about the impact on businesses.

Chief executive Goh Choon Phong said it was "too early to say" whether a recovery was under way in the market for travel to the protest-hit city, despite several airlines based outside the region noting an uptick in demand to levels not seen since the turmoil began.

"Of course, there was a decline in demand and it has stabilised," Goh said at an event for the release of the firm's half-year results for the 2019-2020 financial year.

Hong Kong is the second biggest destination for customers of Singapore's national airline in terms of the number of seats the carrier makes available for sale.

Singapore Airlines chief executive officer Goh Choon Phong. Photo: Bloomberg alt=Singapore Airlines chief executive officer Goh Choon Phong. Photo: Bloomberg

The airline, a bellwether for Asian carriers, on Wednesday said it had seen strong demand in the form of advanced bookings across its network compared to the same period last year, bucking the negative outlook in the industry.

It comes after the firm last week disclosed that demand for travel from Singapore to Hong Kong had fallen sharply in recent months even though bookings for journeys in the other direction had seen single-digit growth. Flights were about 70 per cent full between the two cities, the carrier said.

Goh added: "We do see a drop in demand. It is not very uniform and it varies month to month. Those who really have to travel for business will still do so. The impact is stronger on the leisure side. If you are going to Hong Kong for leisure, go for alternatives.

"[Some travellers] may have the booking but at the end of the day may not feel comfortable and cancel."

Against a backdrop of strong revenues and stable profits in the first half of the fiscal year, the airline's finance chief Stephen Barnes said potential losses from the Hong Kong unrest had been "relatively minor" compared to the rest of its network. The more upbeat assessment stands in sharp contrast to Australian airline Qantas, which has attributed a HK$134.1 million (US$17.1 million) gap in profits to the civil disturbances.

Police officers hit a man as shoppers and anti-government protesters gather in Sha Tin, Hong Kong, on Sunday. Photo: Reuters alt=Police officers hit a man as shoppers and anti-government protesters gather in Sha Tin, Hong Kong, on Sunday. Photo: Reuters

"So we are managing the costs, associated with the operation [in Hong Kong] being down a bit," said Barnes, the company's senior vice-president of finance. "We have cancelled some flights but we have to be careful ... in order to retain the rights to those [landing] slots.

He added that passenger load factors, a measure of how close aircraft are to capacity, were significantly down, but were still above 50 per cent, "which is good".

The Lion City's flag carrier last week made public its flight schedules and adjustments for the Hong Kong market, showing it had trimmed seat capacity by about 5 per cent.

The operational changes included merging flights and introducing smaller aircraft for some trips to the southern Chinese city.

Other major airlines, including Japan's All Nippon Airways, United Airlines, Air Canada and Thai Airways have also made significant changes on routes to Hong Kong.

But US-based United and American Airlines are among carriers that have said the number of bookings to the city had risen.

Hong Kong's flagship carrier Cathay Pacific and Hong Kong Airlines have led the way on reductions to services. Cathay saw inbound passenger traffic fall 9 per cent in September, following a 12 per cent decline in August. Its outbound traffic plunged 38 per cent in each of those two months.

Singapore Airlines, part of the wider Singapore Airlines Group that includes regional carrier SilkAir and budget operation Scoot, flies 207 aircraft to 137 destinations in 37 countries. The firm generated a net profit of S$682.7 million (US$502.6 million) in the 2018-19 financial year.

This article originally appeared on the South China Morning Post (SCMP).

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