Tempozan Market Place, Osaka Japan
This is Water
While exploring Tempozan Market Place near Osaka Aquarium Kaiyukan, we came across this interesting metal art piece.
The love for sashimi elevated to a different level.
There are these two young fish swimming along,
and they happen to meet an older fish swimming the other way,
who nods at them and says, "Morning, boys, how's the water?"
And the two young fish swim on for a bit,
and then eventually one of them looks over at the other and goes,
"What the hell is water?"
David Foster Wallace - This is Water
Formerly a part of Singapore Airlines; SIA Engineering was formed as a subsidiary in 1992 and listed in SGX in 2000. The company provides airframes & component repair and overhaul services for aircrafts and line maintenance & technical ground handing services for flights in-and-out of Singapore Changi Airport.
The company is approved by CAAS, FAA, EASA and JCAB among more than twenty national aviation authorities to provide maintenance, repair and overhaul services to aircraft subject to their jurisdiction.
SIAEC also offer maintenance, repair and overhaul (MRO) services to more than 80 international carriers via its 26 associates and joint ventures in 8 countries.
In FYMar20, revenue declined 3% to $994M and operating profit increased 19% to $67.6M. Net profit increased 20% to $194M.
The sharp uptick in net profit in FYMar17 was due to disposal of Hong Kong Aero Engine Services.
The improvement after a long period of under-performance was admirable. However, Covid-19 pandemic will cause substantial impact on SIAEC performance in FYMar21 and likely for some years to come.
Associates and Joint Venture contributes significantly to the firm's bottom line; which reflect why net margin is higher than operating margin.
Covid-19 pandemic which posed substantial challenges to the aviation industry, will deeply impact SIAEC revenue like her peers.
Recovery is likely to be slow as flights resume gradually city by city. A process that will take years to regain travellers confidence.
Increasing expense relative to revenue since FYMar13 is another key issue which the company must address. The expected substantial fall in top line compels the firm to take immediate and drastic measures to realign her cost structure and productivity.
SIAEC balance sheet is very healthy as of FYMar20. The pandemic is an opportunity for the company to assess her entire economic value chain, improve productivity and reduce relative expenses to improve competitiveness.
Failing which, post Covid-19, the firm will remain a mediocre operation in a smaller playing field.