Apr-09 passenger -18%yoy, cargo -22%yoy — Passenger traffic fell by 18%yoy in April, a slight improvement from March (-22%), possibly due to “Easter effect”, while cargo traffic slumped to worst fall (-22%yoy) since downturn began in Sep-08. Post FY09 results, mgmt highlighted “drop in demand for air travel is leveling out”, but added signs of recovery are not visible yet. Stock likely to underperform until fundamentals improves. Maintain Sell/Low Risk (3L), Target S$8.50.

Passenger — The number of passenger carried fell 18.2% to 1.29m from 1.58m a year ago, while passenger traffic measured in RPKs fell 17.7%yoy, against capacity reduction of 12.9%yoy. Consequently, PLF fell by 4.2ppt to 72.2%. By region, all regions except for East Asia saw declining PLFs, with Europe falling 9.8ppt and Americas by 4.7ppt.

Cargo — Cargo lifted fell 19%yoy while cargo traffic measured in FTKs registered a decline of 21.6%yoy, the worst yoy fall since the downturn started in Sept-08. With capacity reduced by 16.5%yoy, cargo load factor declined by 3.7ppt to 58%; All regions except for Aus/NZ experienced lower cargo load factors. (East Asia -4.2ppt, Americas -3.8ppt, Europe -5.1ppt).

FY10 capacity reduction — For the period Apr-09 to Mar-10, SIA has planned to reduce capacity by 11%, with cutbacks made progressively across the network. The passenger fleet will fall to 99 from 103 over FY10, with 12 new arrivals (5 A380s, 7 A330s), 2 disposals (B747) and 13 “surplus aircraft (9 B777, 4 B747) which are being actively marketed.