JAL sees FY 08 operating loss of 37 bil. yen, 1st red ink in 3 yrs

TOKYO, Feb. 6 Kyodo - Japan Airlines Corp. said Friday it anticipates a group operating loss of 37
billion yen for the current business year through March, its first red ink in
three years.
The projected loss is attributed to a decline in business travelers and
international cargo amid the global economic downturn even as Japanese airlines
carry out cost-cutting measures including fewer flights and pay cuts.
It compares with the air carrier's November forecast of 28 billion yen in
profit and a year-earlier profit of 90.01 billion yen.
''(Demand for) international passenger flights and international cargo has
deteriorated dramatically from last autumn due to the global downturn,''
Yoshimasa Kanayama, JAL's senior vice president for finance, said at a press
briefing in Tokyo.
''We need to brace for a significant decline in revenue for the fourth quarter
as well,'' he said.
He added demand for international passenger flights is likely to decline around
20 percent during the January-March quarter from a year earlier while demand
for international cargo is likely to drop near 40 percent.
For the April-December period of fiscal 2008, Japan's top airline said it
logged a group operating loss of 8.86 billion yen from a year-earlier profit of
82.58 billion yen.
In the nine-month period, JAL said it also logged a group net loss of 1.92
billion yen from a year-earlier profit of 20.45 billion yen on revenue of 1.56
trillion yen, down 8.3 percent.
Revenue from international flights decreased 0.5 percent from a year earlier to
570.2 billion yen and revenue from international cargo dropped 7 percent to
133.5 billion yen as demand for routes to the United States and Europe declined
due to the worldwide economic slowdown and the yen's appreciation.
Revenue from domestic flights inched up 0.2 percent to 520.9 billion yen as the
number of package tour travelers increased on aggressive promotion campaigns,
but Kanayama said even demand for domestic traveling has dropped sharply from
this month.
In its downward revision of its earnings projections for the whole of fiscal
2008, JAL said it expects a group net loss of 34 billion yen. That compares
with a net profit of 13 billion yen in its November forecast and its
year-earlier 16.92 billion yen in profit.
It anticipates revenue of 1.98 trillion yen, compared with its earlier forecast
of 2.09 trillion yen and down 11.4 percent from a year earlier.
JAL only returned to the black in net terms in fiscal 2007 after suffering from
internal management strife and a series of safety problems. But its business
conditions rapidly deteriorated again, as the spreading global recession took a
toll on travel demand.
Both JAL and All Nippon Airways Co. say they will significantly scale down
their international and domestic flights in the year that begins in April. JAL
has been expanding cuts in executive pay to up to 55 percent from last year
while ANA is also eyeing wage cuts averaging about 6 percent in fiscal 2009.
Earlier this week, Japanese airlines sought emergency government aid to cope
with sharp drops in traveler and cargo traffic volumes.
==Kyodo