The JAL Group has reported a 74% decline in operating revenue to ¥194.7bn between April and September 2020. Pre-tax losses reached ¥223.9bn, with a net loss of ¥161.2bn.
International passenger demand decreased by 97.7% and international passenger revenue recorded ¥9.1bn, down 96.6% year-on-year. Domestic passenger numbers are down 76.1% and passenger revenue recorded ¥69.6bn, down 75.6% year-on-year.
JAL operated 7,228 cargo flights using passenger aircraft in period helping boost cargo revenue by 18.4% year-on-year to ¥53.4bn.
The group states that it has reduced operation expenses by 40% to ¥217.8bn year-on-year, which the company aims to continue. The reductions have been made thanks to reduction in personnel, advertising and other fixed costs, with a total reduction ¥80bn for capex.
“The JAL Group will continue to carry out drastic cost and capex reduction initiatives in a timely manner and make company-wide efforts to improve performance”.
JAL has cash of ¥346.6bn as of the end of second quarter, securing sufficient liquidity. The company plans to set up an additional ¥100bn credit facility in December, resulting in the total amount of unused credit facility of ¥300bn. Repayment of interesting-bearing debts within one year is limited to ¥50.9bn.
As a part of the restructuring of its international passenger business, JAL states that it plans to retire a number of its Boeing 777 fleet. The impairment loss and other costs related to the retirements are included in JAL’s 2021 EBIT forecast.
JAL says that it will make “every effort to minimise losses through flexible capacity adjustment and thorough cost reduction measures”.