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TOKYO: Japan Airlines Corp. said Friday that it had returned to profit in the year to March after two straight annual losses, but forecast a 23 percent drop in earnings this year amid high fuel costs.
Asia's largest carrier posted a net profit of 16.9 billion yen (163 million US dollars), compared with a net loss of 16.27 billion yen the previous year.
The airline has moved to restore its financial health by slashing thousands of jobs and scrapping unprofitable routes.
Earnings were slightly higher than the carrier's preliminary estimate earlier this month of a net profit of about 16 billion yen.
Operating profit surged to 90.0 billion yen from 22.9 billion but revenue dropped 3.1 percent to 2.23 trillion yen because JAL sold most of its stake in Jalux Inc., which operates retail outlets at airports.
Passenger revenue from international routes increased by 4.0 percent from the previous year, helped by strong ticket sales for flights to China, South Korea and Southeast Asia, while domestic passenger demand was stagnant.
The airline said that it had managed to significantly reduce its operating expenses to help it cope with soaring jet fuel costs. JAL shrank its workforce by 2,207 people over the year.
For the current financial year to next March, JAL forecast a net profit of 13 billion yen, operating earnings of 50 billion and revenue of 2.18 trillion.
"Even though the JAL Group has made great strides towards achieving its overriding goal of building a robust management framework, a business structure which can produce profits even in the face of factors such as rising fuel costs or slowing demand, the business environment continues to be severe," it warned.
The airline has had a difficult time since its 1987 privatisation and a tricky merger with domestic carrier Japan Air Systems that was finally completed in 2004.
The carrier has been pressured by rising fuel costs and a series of safety scares that benefited rival All Nippon Airways. - AFP/ac
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