Tiger's Aussie arm will still be 'loss-making': analyst

Profit loss pegged at a 40% proportion.

According to OCBC Investment Research, while TGR AU will be a standalone entity following the expected sale completion in2HCY13, it expects the incurrence of losses to continue – albeit at a lower 40% proportion.

OCBC noted that although operating losses have narrowed, TGR AU remains loss-making and this trend could continue until the new entity incorporates complimentary services with Virgin Australia.

It also added that TGR’s other associate – South East Asian Airlines (SEAir) – is still in its infancy stage and operating losses could still hit TGR’s books in the nearterm

Here's more:.

ACCC approves TGR AU sale to Virgin Tiger Airways (TGR) announced yesterday that it received approval from the Australian ACCC to sell 60% of TGR AU to Virgin Australia. This long-awaited approval was met positively and TGR’s share price closed more than 6% higher as a result.

TGR SG’s performance will no longer be overshadowed Following this approval, TGR will record a one-time gain on disposal of S$119.8m and shore up its balance sheet.

More importantly, investors can now look to TGR SG as the main growth driver for the Group. As a recap, TGR SG recorded an impressive 30.7% YoY growth in 9MFY13 revenue to S$444m on the back of passenger load factor improvements (+3ppt to 84.3%).

Subsequently, TGR SG has continued to post encouraging operating statistics for the quarter just ended (4QFY13), and passenger load factors are expected to increase by at least 4ppt to 84.4% from a year ago.

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