Japan Airlines Reduces First Half Loss Through Cost Cuts, Reports Annual Loss

Japan Airlines (JAL) planes are seen, amid the coronavirus disease (COVID-19) outbreak, at Tokyo International Airport, commonly known as Haneda Airport in Tokyo, Japan, October 30, 2020. REUTERS / Issei Kato

  • Post a loss of $ 1.34 billion in the first half
  • Plans to stop burning money by Q4
  • Japan plans to gradually ease border restrictions

TOKYO, Nov. 2 (Reuters) – Japan Airlines Co Ltd (JAL) (9201.T) on Tuesday reported a lower loss before interest and taxes in the first half of the year, aided by cost cuts undertaken by the carrier during the pandemic, but he reported a larger annual loss than expected.

The company recorded a first-half loss of 151.8 billion yen ($ 1.34 billion). The previous year, Japan’s second-largest airline reported a loss of 223.9 billion yen in the six-month period ended Sept. 30.

JAL said on Tuesday it would report an annual loss of 198 billion yen, higher than the consensus loss of 120 billion yen of 12 analysts polled by Refinitiv.

In August, the carrier did not provide a full-year profit forecast, saying the uncertainty made forecasting too difficult. Read more

The airline, like the travel industry in the world’s third-largest economy, was hit hard, with Japan in a state of emergency for much of the second quarter.

JAL said its workforce would decline from 2,500 by the end of the fiscal year, March 31, to 33,500 as older workers retire and it has frozen new hires to reduce costs.

Rival ANA Holdings Inc (9202.T) said last week that it planned to report an operating loss in the current fiscal year, down from an earlier profit forecast, and that it reduce the workforce by 20% within five years through attrition. and retirement. Read more

JAL said it expected to stop spending money by the fourth quarter of the fiscal year as travel demand improves.

He said the number of domestic passengers started to increase last month and by March it is expected to reach 92% of pre-COVID levels, although international traffic remains moderate at 23% of pre-COVID levels.

Japan confirmed on Tuesday its intention to gradually ease COVID-19 border restrictions, but did not respond to calls from business lobbies to open the country in line with its major trading partners. Read more

The country is still subject to strict regulations preventing most non-resident foreigners, including tourists and business travelers, from entering.

The government has decided to review border controls in stages, Chief Cabinet Secretary Hirokazu Matsuno told reporters on Tuesday, responding to media reports that the quarantine for business travelers would be reduced from 10 to three days.

($ 1 = 113,6800 yen)

Report by Maki Shiraki in Tokyo; Writing by Jamie Freed; Editing by Kim Coghill, Sherry Jacob-Phillips, Kirsten Donovan

Our Standards: Thomson Reuters Trust Principles.


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