Tiger IPO set for major take-off

Tiger Airways has lodged its preliminary prospectus with the Monetary Authority of Singapore to be listed on the Singapore Exchange Securities Trading Limited.

The proceeds will be used for expansion plans, such as the acquisition of the Aircraft A320 aircraft, to establish new airlines and operating as well as service short-term debts owed.

In its prospectus, the company reveals a negative operating cash flow of S$39.5 million in 2009.A net loss of S$50.8 million (US$36.1 million) in fiscal year 2009 was also reported compared with a net profit of S$9.9 million in fiscal year 2008 which was attributed to “increased volatility in both jet fuel costs and foreign exchange rates”, according to a note by Tiger Airways. “Our fuel costs (taking into account our fuel hedging losses) for fiscal year 2009 increased by 61.5% from S$123.2 million to S$198.9 million, compared to our growth in ASK capacity of 28.0%. In addition, we recognised a tax charge in fiscal year 2009, compared with the recognition of a deferred tax benefit in fiscal year 2008. These factors resulted in our net loss, despite a 24.4% increase in total revenue from S$303.8 million in fiscal year 2008 to S$378.0 million (US$268.3 million) in fiscal year 2009.”

Tiger has refused to issue further comments until its registration is complete.

The IPO will be underwritten by Citigroup, Morgan Stanley and DBS Bank.