ANA Group’s Fiscal First-Half Profit Tumbles

ANA Group’s Fiscal First-Half Profit Tumbles

Japan’s ANA Holdings Inc., the parent firm of All Nippon Airways Co. (ANA), said on Oct. 30 that its group net profit nosedived in the first half of fiscal 2013, which started in April, from a year earlier, despite a jump in international cargo revenue.

ANA Holdings posted a net profit of ¥20.070 billion ($204.8 million) on a consolidated basis in the April-September period, down 45.7 percent from the same six-month period last year.

The ANA group’s revenue from overall operations grew 5.9 percent year-on-year in the first half of fiscal 2013 to ¥797.626 billion ($8.1 billion). The ANA group posted an operating profit of ¥43.311 billion ($441.9 million) in the April-September period, down 42.5 percent from a year earlier.

ANA Holdings blamed the sharp decline in both operating and net profits in the first half of the current fiscal year on a surge in operating expenses, which soared 11.3 percent on a year-on-year basis.

The ANA group’s revenue from international cargo operations soared 18.6 percent in the April-September period from a year earlier to ¥49.1 billion ($501.0 million). But its revenue from domestic cargo operations dropped 3.6 percent to ¥15.2 billion ($155.1 million).

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

The strong growth in international cargo revenue “was a result of strong demand to move goods from China and Asia to North America and ANA's ability to capture cargo demand across Asia by utilizing Okinawa as a hub,” the carrier said in an earnings release.

The ANA group’s poor performance in domestic cargo operations was due to “sluggish demand for air cargo, driven by a shift towards land transportation, the impact of poor crops on fresh food deliveries and a drop in unit prices driven by intense competition from land transportation and other competitors,” the carrier said.

ANA Holdings also revised downward its initial group revenue and profit forecasts for the whole of fiscal 2013, which were announced on April 30. The company’s new full-year projections are: ¥1.580 trillion ($16.1 billion) in group operating revenue, up 6.5 percent from fiscal 2012; ¥60.000 billion ($612.2 million) in group operating profit, down 42.2 percent from fiscal 2012; ¥15.000 billion ($153.1 million) in group net profit, down 65.2 percent from fiscal 2012.