|ANA Reports Financial Results for the First Half of FY08
- revenue and profits down in tougher operating environment -
- forecast for whole year revised down -
TOKYO October 31, 2008 - ANA Group today reported its consolidated half year financial results for the interim period April 1 to September 30, 2008. The Group, which consists of airlines, travel and other businesses, reported an operating profit of $480.8 million (¥49.8 billion) and a net profit of $212.4 million (¥22 billion) on revenue of $7.3 billion (¥753 billion) - falls of 25.7%, 79.1% and 1.3% respectively - against a background of declining passenger numbers. Net profit, in the same period in the previous year, had been boosted beyond normal levels by an extraordinary gain on the sale of ANA´s hotel properties.
ANA executive vice president Finance, Tomohiro Hidema, said of the Group´s performance: "These midterm results reflect the challenging operating environment in which we find ourselves. Beyond the price of oil, which hit historic highs and sent our fuel bill soaring for most of the period under review, we are faced at home with softening overall demand and increased competition from other airlines and the railways. These elements, coupled with our own cuts in capacity, have meant that revenue on our domestic operation was down year-on-year. On the international front, however, despite the shadow cast by the global recession on business travel demand on our North American routes in the first instance, and latterly on our European routes, and a drop in demand for travel in general to China, revenue was up on last year, buoyed in part by growth in the intra-Asia cargo market.
Nevertheless, and despite our best efforts to control costs and stimulate demand, consolidated revenue, operating profit and net profit fell during the six months under review.
Looking forward, given the recent turmoil in the world´s financial markets, the sudden slow down in economic activity and the ensuing fall in demand for travel - beyond anything we could have imagined at the beginning of the current fiscal year - we are having to downwardly revise our outlook for the full 12 months of fiscal year 2008. We will tighten our belts to gain further cost reductions where possible and step up our sales efforts to spur demand as we try to minimize the effect of the slowdown on revenue."
Domestic Air Transport
Equally, on the sales front ANA improved its products for business travelers by introducing new business fares, and stimulated greater demand among leisure travelers during the summer by increasing the availability of "Tabiwari" advanced purchase tickets.
Despite these measures and an improved unit price following a fare rise in April, passenger numbers and revenue fell 3.3% and 2.3% respectively. However, this was less than the 4.2% capacity cut on the domestic network, so load factors rose as a consequence.
International Air Transport
Notwithstanding the fall in traffic, fuel surcharge revisions led to an improved unit price and a 2.2% year-on-year increase in revenue.
Furthermore, ANA took delivery of the world´s first Boeing 767 passenger-to-freighter conversion, adding capacity to the network, and ANA´s express parcel delivery service, All Express (ALLEX), began operations on July 1.
On the domestic front, an increase in unit price in April and efforts to improve sales in periods of low demand led to an almost 10% increase in revenue.
Outlook for FY2008
Contact: Damion Martin, ANA Public Relations: firstname.lastname@example.org
Notes for Editors