Here's why SIA is heading into turbulence with heavy exposure to Europe and Australia

SIA derives 40% of its passenger income from these lower-growth regions.

Here's more from CIMB:

An uneven recovery ahead
SIA maintained its weak guidance for both its passenger and cargo businesses, mostly on long-haul routes. We are less pessimistic on the overall prognosis for the industry as we think that, like the rest of the sector, SIA will remain prudent with capacity growth in an attempt to stabilise yields.

That said, we believe SIA‟s relatively heavier exposure to lower-growth Europe and Australia is likely to harm it further in the near term. The carrier derives 40% of its passenger income and allocates about 50% of its available seat kilometre capacity to those two regions.

Structural difficulties ahead as well
Apart from increased risk posed by its route region profile, we believe that SIA continues to have little answer to the increased competition from the low-cost carriers in the region. Moreover, the fifth-freedom traffic dominance it once enjoyed has been eroded by Middle-Eastern carriers, especially on the Kangaroo route. In the future, we think the Chinese airlines are likely to boost frequencies on this sector as well, further eating into SIA‟s market share.