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Japan Airlines and All Nippon Airways forecast profits to continue to increase
May 6th 2016
Japan Airlines (JAL) has improved its full-year net profit by 17.1%, to an impressive 174 billion yen ($1.6 billion), although the results were tempered by the generous tax measures enjoyed by the carrier to assist the airline’s financial rehabilitation. Read More »
For the fiscal year 2015-16, JAL built its international ASKs by 1.3% on 5.4% more traffic, but on 1.3% decreased revenues. Like rival, All Nippon Airways (ANA), JAL’s trans-Pacific routes fared best for the airline, with growth of 7.7%. The carrier’s international cargo traffic fell 1.7% during the year due to “sluggish” demand, with revenues down 10%. JAL predicted another full-year net profit gain to 192 billion yen in the current financial year to March 31, 2017.
ANA Holdings, ANA’s parent, doubled its full-year net profit to 78.1 billion yen ($722 million). ANA’s international traffic and passenger numbers rose 14% and 13.3%, respectively, surpassing JAL for the first time. ANA’s international ASKs grew 10.6% during the year ended March 31, with the largest growth also registered on trans-Pacific services. ANA forecast a net profit of 80 billion yen in the current financial year. It will launch a Narita-Phnom Penh service in September and hopes to launch Mexico City by March.
JAL's bailout terms restricted investments and service route expansions to maintain a level playing field, but these constraints expire at the end of the current financial year. JAL is expected to tap into profits earned in the past few years to launch destinations and increase frequencies on existing routes.
ANA has an ace up its sleeve. Last week, Japan’s aviation authorities allotted the airline four Haneda-U.S. slots. JAL only received two.
