JAL's profit dips despite strong cargo revenue

JAL's profit dips despite strong cargo revenue

Japan Airlines said Friday its group net profit of 80.3 billion yen ($723 million) declined 2.0 percent year-over-year in the first half of fiscal 2014, despite a sharp rise in international cargo revenue.

The carrier said its international cargo revenue soared nearly 10 percent in the April-September period from a year earlier, partly because of strong demand for cargo transportation to North America, especially automobile-related shipments.

JAL’s group revenue from overall operations increased 3.7 percent year-over-year in the April-September period, totaling 683 billion yen. Its group operating profit dropped 3.1 percent to 92.8 billion yen.

JAL’s group revenue from both international and domestic cargo operations in the April-September period totaled 41.1 billion yen, up 5.6 percent from the same six-month period last year.

Of the overall cargo revenue, 28.8 billion yen came from international operations, up 9.6 percent from a year earlier, and the remaining 12.3 billion yen came from domestic operations, which declined 2.8 percent year-over-year.

Looking back on international cargo operations in the first half of fiscal 2014, JAL said, “We actively captured automobile-related shipments from Japan, spurred by the growth of exports, especially to North America; improved our revenue management; and efficiently captured transit shipments such as perishables in an effort to maximize revenues.

“As a result, the volume of international cargo we handled during the reporting period in terms of revenue cargo ton kilometers (RCTK) increased 14.1 percent year-over-year,” the carrier said.

“We also attracted robust perishable shipments in the summer. However, due to the decrease in supply, the volume of domestic cargo we handled during the reporting period when measured in RCTK declined 3.1 percent year-over-year,” the carrier said.

JAL said it revised its initial group revenue and profit forecasts for fiscal 2014, which were announced on April 30.

The carrier’s new projections for the current fiscal year are: 1.34 trillion yen in operating revenue, up 2.3 percent from fiscal 2013; 158 billion yen in operating profit, down 5.3 percent from fiscal 2013; 135 billion yen in net profit, down 18.8 percent from fiscal 2013.

Contact Hisane Masaki at yiu45535@nifty.com.