All Nippon Airways Co, Japan's largest domestic carrier, has reported a boost in Q3 profit that has come also on the back of an increase in international traffic.

The airline said that net income had gone up 34 per cent to 12.4 billion yen ($117 million) in the three months ended Dec 31, compared with a profit of 9.3 billion yen a year earlier.

During the quarter, revenue from domestic transport rose 2.3% to ¥187.8 billion on a 2.3% fall in passengers to 11.7 million. Traffic was down 1.8% to 10.25 billion RPKs against a 0.3% increase in ASKs to 15.69 billion.

Load factor dropped 1.4 points to 65.3%.

International transport revenue rose 5.8% to ¥77.6 billion as passenger numbers increased at the same rate to 1.2 million. RPKs grew 4.6% to 5.33 billion as capacity climbed 4.1% to 7.12 billion ASKs and load factor gained 0.3 point to 74.8%.

ANA said it would not change its full-year forecast of a ¥64 billion net profit, which would nearly double the ¥32.6 billion reported in the fiscal year ended March 31, 2007.

Over the next four years the airline plans to increase its international operations from Tokyo Narita to Europe and the US by 26% and boost frequencies to China and Asia by 11% from Tokyo's inner-city Haneda Airport.

The carrier carried 5.8 per cent more international passengers in the period as it added flights to China and India. The airline has begun to target the international market even as it faces increasing competition from discount carrier Skymark Airlines at home.

The airline has been cutting low-margin routes within Japan in an attempt to boost profits, slashing as many seven routes last year. It is due to slash the same number between 1April to 1 July this year.

It reported a 2.3 per cent drop in domestic passengers for the quarter with lesser flights and added competition.

Analysts said that stronger passenger volume from international routes was the outstanding feature in this quarter's earnings report.