The high cost of fuel and the impact of the weak Yen caused All Nippon Airlines profit to fall by 38% to JPY 65.9bn during fiscal year 2013. Fuel costs increased by JPY66 billion (USD650 million). Landing and navigation charges grew by 5.9%, less than ASK growth and despite these being impacted by foreign exchange. Leasing costs were up 12.6%, depreciation and amortisation 10.2%, maintenance 15.5% and sales 10.5%. Staff costs were down 2.7%. Overall ANA's non-fuel costs rose by 6.6% in FY2013, slightly ahead of 6.2% ASK growth. CASK including fuel grew 10.5%. ANA's operating margin decreased to 4.1%.
ANA posted record revenue however, which grew by 7.9% to JPY1.6 trillion. Revenues from domestic passenger services rose by ¥9.1 billion, or 1.4% year-on-year, while revenues from international passenger services grew by ¥47.0 billion, an increase of 13.5%. Domestic cargo revenue fell by ¥0.1 billion but revenues from international cargo services rose by ¥18.1 billion, an increase of 21.0%.
By the end of FY2014 ANA will have taken out JPY86.5 billion (USD850 million) of costs, with a further JPY50 billion (USD490 million) reduction planned by the end of FY2016. In total this is JPY36.5 billion (USD358 million) more than the JPY100 billion (USD984 million) ANA forecast to be reduced by FY2016.
Although ANA's overall FY2013 performance was weak, ANA is optimistic FY2014 will be kinder. ANA was hit in 1H2013 with ongoing 787 problems and weakened demand from China, impacting profit. These challenges moved out of focus and ANA in 2H2013 saw better performance than 1H2013, leading the carrier to believe it can continue the momentum in FY2014.