Japan Airlines reduces Q1 losses with lower labour costs
07 Aug 2008
Tokyo, Japan: Japan Airlines Corp (JAL), Asia's largest carrier by sales, reduced first-quarter losses by trimming jobs, bonuses and retirement benefits. The carrier said it had posted a loss of 3.4 billion yen ($31.1 million) for the three month period, ended June 30, compared with a 4.3 billion yen ($38.92 million) loss a year earlier.
Sales fell 5.8 per cent to 490 billion yen ($4.43 billion).
The Tokyo-based carrier said it was cutting 10 billion yen in labour costs through the elimination of at least 400 jobs this fiscal in an attempt to offset rising fuel costs. This measure would also be accompanied with route cuts - 12 on domestic routes and three on international ones.
The carrier kept its profit forecast unchanged at 13 billion yen for the year ending 31 March 2009.
It said fuel costs would increase to 532 billion yen ( $4.81 billion) this fiscal, at least 4 per cent higher than its initial prediction of 510 billion yen ($4.61 billion). This compares to 412.7 billion yen ($3.73 billion) over the previous fiscal year.
JAL, which has hedged more than 80 per cent of its fuel needs this fiscal year, said it plans to introduce 18 new planes this fiscal year, including two more fuel-efficient Boeing Co 777s, and retire 19 aircraft.
It was operating a fleet of 274 planes in April.
It cut international capacity by 3.5 per cent and domestic capacity by 2.6 per cent from the year-ago quarter. It flew 5.1 per cent fewer international passengers and 0.7 per cent fewer domestic travellers. Revenue from international tickets rose 4.8 per cent to 180.4 billion yen, mainly on the back of increased fuel charges, even as domestic passenger revenue fell 1 per cent.
