Tough times ahead for Singapore Airlines, but one analyst says it appears better positioned than its peers

As air carriers worldwide are caught in a “race against time” while trying to stay afloat as global travel is nearly completely wiped out, Singapore Airlines appears to be better positioned than its peers, according to one analyst. “Everyone ... is battling this,” said Brendan Sobie, an independent analyst at Sobie Aviation, on Thursday. Comparatively, Singapore Airlines “is in a better position,” he said, citing the Singapore flag carrier’s liquidity position, which in his opinion was better than “virtually anyone in the global airline industry.” “What that means is they can survive a prolonged downturn, come out of hibernation very strong in a few years and potentially take advantage of consolidation,” Sobie said. Asked if SIA will need to return to the market soon to secure more funds as it seeks to tide through this period, Sobie said the 11 billion Singapore dollars raised would be “sufficient for some time” and could last more than a year. “The other thing to keep in mind is ... they have an additional 6 billion (Singapore dollars) that they can raise through mandatory convertible bonds ... which they announced already as part of their liquidity measures,” he added. Sobie’s view was echoed by Nomura analysts, who said in a July 29 note that Singapore Airlines’ recent rights issue has “strengthened” the carrier’s balance sheet. Looking ahead, Sobie said SIA is set to become “much smaller for the next few years” and is expected to take a “very long time” to recover fully to its normal size.<br/>