JAL Group posts reduced losses

7th Aug 2008

The JAL Group has announced consolidated
financial results for the first quarter (April through June 2008) of
FY2008 with a reduced net loss of 3.4 billion yen.When compared
to the same period last year, the Group saw an improvement in the air
transportation segment - its core business - with operating revenue
increasing by 6.1 billion yen to 428.1 billion yen, and operating income
increasing by 14.2 billion yen to 3.3 billion yen.

Total consolidated operating revenues for the three-month period were
490.3 billion yen, 30.3 billion yen (- 5.8%) down on the same period
last year. The decrease occurred primarily due to two companies being
removed from the list of JAL Group consolidated subsidiaries. In
November 2007, JAL Corporation decreased its shareholding in AGP
Corporation and, in January 2008 transferred all of its shares in
Pacific Fuel Trading Corporation (PFTC).

In the air transportation segment, however, there was an increase in
total revenue. Operating revenue for the air transport segment including
both international and domestic passenger and cargo businesses,
increased by 1.4% up 6.1 billion yen from 422.0 billion yen to 428.1
billion yen, boosted by an 11.2% year-on-year increase in international
passenger yields.

With regard international and domestic passenger operations, the JAL
Group got off to a good start carrying out the various strategies of its
FY2008-10 medium-term revival plan announced on February 29, 2008, by
proactively restructuring its network and downsizing aircraft in its
fleet. Consequently, supply measured in available seat kilometers (ASK)
decreased by 3.5% on international routes and by 2.6% on domestic routes
compared to the same period last year.

International passenger demand and domestic passenger demand, measured
in revenue passenger kilometers, (RPK) were down 5.7% and 0.3%
respectively when compared to the previous year, primarily due to the
decrease in supply already mentioned.


Operating expenses were 486.4 billion yen, down 42.8 billion yen or 8.1%
on the same period last year, a result of steady implementation of cost
reforms outlined in the JAL Group medium-term revival plan. The JAL
Group managed to limit the full impact of an unprecedented rise in the
price of fuel by carrying out a wide range of fuel consumption reduction
and fuel efficiency improvement measures in addition to flexible fuel
hedging, which included fleet renewal, weight reduction measures,
regular engine washing, and adoption of more fuel efficient flight
operation procedures.

Compared to the same period last year, the JAL Group’s operating income
in the first quarter of FY08 increased by 12.4 billion to a total of 3.9
billion yen, and ordinary income increased by 3.9 billion yen to a total
of 0.7 billion yen. Net income increased by 0.8 billion yen resulting in
the JAL Group posting a net loss of 3.4 billion yen. This is the fifth
consecutive year since FY2003 that the JAL Group has reduced its net
loss in the first quarter.


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