Source: AFP
Japan Airlines, which went bankrupt two years ago in one of the country’s biggest-ever corporate failures, reported a nine-month profit of almost US$2.0 billion on Thursday, in part thanks to the strong yen.
The carrier was bailed out by the government after filing for bankruptcy with debts of about JPY2.32 trillion, and emerged from a court-supervised restructuring in March last year.
JAL said net profit reached JPY146 billion (US$1.92 billion) in the nine months to December after aggressive cost-cutting. It posted an operating profit of JPY162 billion on sales totalling JPY909 billion in the period.
Because of the massive restructuring JAL carried out under government supervision — led by chairman Kazuo Inamori — the airline does not have comparable data from the previous year.
The company upgraded its forecast for the full year to March to a net profit of US$2.1 billion, partly due to a stronger yen that encourages more Japanese to travel overseas.
“Revenue for the third quarter…has increased from the original projection in part due to the high yen rate, which encouraged international leisure travel from Japan, as well as from stable corporate travel demand,” JAL said.
In contrast, many Japanese exporters have blamed the strong yen for hurting their balance sheets, as it makes their products more expensive abroad and erodes the value of repatriated profits from overseas operations.
“JAL continued to review aircraft scheduling on each route and enforced measures to increase revenues while examining every cost category to achieve greater cost reduction, such as in fuel costs,” the airline said.
The number of passengers travelling to Thailand decreased in October due to severe flooding in that country, but JAL increased flights on its Delhi route to meet robust corporate travel demand, the airline said.
For the year to March 2012, JAL now expects a net profit of JPY160 billion and operating profit of JPY180 billion on sales of JPY1.19 trillion.
In November, JAL had expected a lower net profit of JPY120 billion and an operating profit of JPY140 billion on sales of JPY1.15 trillion.
During its restructuring the company cut unprofitable routes, reviewed its fleet, and reduced fuel expenses. It also started using a new revenue management system to improve productivity.
