All Nippon Loses $43 Million

All Nippon Airways group posted its first full-year net loss in six years in fiscal 2008.

“Due to an unprecedented fall in demand for domestic and international air travel -- in particular high-yield business travel, in the latter half of the year under review -- and a sharp drop in demand for air cargo services," the airline said it lost $43 million in fiscal 2008, compared with a net profit of $657 million in fiscal 2007.

ANA revenue from its international cargo operations dropped 4.3 percent in fiscal 2008, which ended on March 31, to $707 million, the second-largest Japanese air carrier said.

The ANA group carried 354,000 tons of freight on its international routes in fiscal 2008, up 6.5 percent from fiscal 2007. International freight transportation volume totaled 1.653 billion ton kilometers, up 0.5 percent.

The ANA group's revenue from its domestic cargo operations grew 8.3 percent in fiscal 2008 to $338 million. The ANA group carried 475,000 tons of freight on its domestic routes, up 2.7 percent, and its domestic freight transportation volume amounted to 464 million ton kilometers, up 4.4 percent.

On the international cargo operations, ANA "aggressively captured demand for cargo flows from China and the rest of Asia to North America and Europe, resulting in increased volumes for the full financial year," the airline said in a statement.

"However, demand tailed off from November in the wake of the global recession and unit price fell in the face of increasing competition, bringing down revenue compared with the previous year," ANA said.

On the domestic cargo operations, ANA said, "Volumes carried on domestic routes increased during the twelve months under review, thanks in part to a change in the designation of small packages transported for Japan Post from 'mail' to 'cargo', and an off-peak charging structure introduced to take advantage of quieter afternoon and holiday periods."

ANA said that its group revenue and profits from its overall operations, including domestic and international passenger transport, fell due to a slump in demand for both air travel and air cargo services against the backdrop of the global recession triggered last autumn by the financial market turmoil.

The ANA group's revenue from its overall operations totaled about $14.3 billion in fiscal 2008, down 6.4 percent from the previous fiscal year. Operating profit plunged a whopping 91 percent to $77 million.

ANA did not give specific profit figures for its cargo operations.