Japan Airlines Co., Ltd. · TSE:9201
Japan Airlines — Q1 FY2016 Earnings Presentation
31 slides from Japan Airlines's earnings presentation, Jul 29, 2016
Slide 1: Financial Results 1st Quarter Mar/2017 (FY2016)
JAPAN AIRLINES Co., Ltd. Financial Results 1st Quarter Mar/2017（FY2016） July 29, 2016
Slide 2: Today's Topics
Today’s Topics P.1 P.2 P.13 From the first quarter of this fiscal year, figures for Revenue Passengers Carried, ASK, RPK and Load Factor include “Marketing Carriers’ on code- sharing flights operated by JAL”. The year-earlier first quarter also shows the figures after reflecting this change.
Slide 3: Overview of Financial Results for 1st Quarter Mar/2017
Overview of Financial Results for 1st Quarter Mar/2017 Operating Revenue Operating Profit （OP Margin） （JPY Bn） （JPY Bn） 340 50 20% ▲14.8Bn ▲14.1Bn （▲4.8%） 36.2 （▲39.1%） 15% 312.0 300 297.2 22.0 25 10% 11.6% 7.4% 5% 260 1st Quarter 1st Quarter 0 0% FY Mar/16 FY Mar/17 1st Quarter 1st Quarter FY Mar/1
Slide 4: First-quarter financial results commentary
Now, for our first-quarter financial results for the fiscal year ending March 31, 2017. Operating revenue was 297.2 billion yen, 4.8% lower than the year before. Operating profit was 22 billion yen, down 39.1% from a year ago, due to a decline in demand and increases in maintenance and personnel
Slide 5: Consolidated Financial Results
Consolidated Financial Results Consolidated Financial Results 1st Quarter FY Mar/17 1st Quarter 1st Quarter Operating revenue was 297.2 （JPY Bn） y/y FY Mar/16 FY Mar/17 billion yen, ▲4.8% y/y. Operating Revenue 312.0 297.2 ▲4.8% Air Transportation Segment 282.4 268.3 ▲5.0% Operating Expense 275.7
Slide 6: Consolidated financial results commentary
Next, I will explain about details of our first quarter consolidated financial results. Operating revenue was 297.2 billion yen, a decline of 4.8% year-on-year. Operating expenses were 275.1 billion yen, down 0.2% year-on-year, due to both lower fuel prices and an increase in other costs. We will
Slide 7: Changes in Operating Profit
Changes in Operating Profit 1st Quarter FY Mar/17 ▲14.1Bn (JPY Bn) Impact From Currency Market +2.9Bn (▲39.1%) Revenue ▲3.7Bn Cost +6.6Bn Fuel +3.3Bn Ex. Fuel +3.3Bn ASK y/y ： ▲0.3% RPK y/y ： ▲0.3% Int’l Passenger Maintenance Domestic Fuel ▲2.6 Aircraft Personnel ▲9.9 Passenger ▲0.2 ▲6.3 Other Cost
Slide 8: Changes in operating profit commentary
I will explain about the changes in operating profit. Revenue declined by 14.8 billion yen from the year before due to a decrease of 3.7 billion yen because of the stronger yen. International passenger revenue decreased by 9.9 billion yen year-on-year, as the operations were impacted by a drop in
Slide 9: International Passenger Operations (Operating Results)
International Passenger Operations (Operating Results) International Passenger 1st Quarter 1st Quarter y/y Passenger Revenue was 99.5 FY Mar/16 FY Mar/17 billion yen, declined 9.9 billion Passenger Revenue (JPY Bn) 109.4 99.5 ▲9.1% yen y/y basis. ASK was up 1.2% y/y and RPK ASK (MN seat km) 12,5
Slide 10: International passenger commentary
Now I will explain about the traffic results and passenger revenues for our international passenger operations. ASK on international routes rose by 1.2% year-on-year, RPK increased by 0.4%, and as a result, the load factor was 78.2%, 0.6 percentage points lower than the year before. Revenue per p
Slide 11: International Passenger Operations (Change in Revenue)
International Passenger Operations (Change in Revenue) 1st Quarter FY Mar/17 ▲9.9Bn Net unit price improved through (JPY Bn) (▲9.1%) revenue management and the expansion of JAL SKY SUITE 109.4 operated routes, but the impact of fuel surcharge revenue decrease ▲7.8 and the stronger yen caused a 99.
Slide 12: International passenger revenue commentary
In terms of “revenue per passenger”, international passenger revenue decreased by 7.8 billion yen due to lower fuel surcharge revenue. However, revenue management contributed to an increase in net unit price as shown in the chart in the lower right corner on page 4. In terms of “numbers of passeng
Slide 13: Domestic Passenger Operations (Operating Results)
Domestic Passenger Operations (Operating Results) Domestic Passenger 1st Quarter 1st Quarter Passenger revenue was y/y FY Mar/16 FY Mar/17 109.4 billion yen, down 0.4 Passenger Revenue billion yen y/y. 109.9 109.4 ▲0.4% (JPY Bn) ASK (MN seat km) 8,973 8,743 ▲2.6% ASK was ▲2.6% y/y while RPK was
Slide 14: Domestic passenger commentary
Next, I will explain about the traffic results and passenger revenue in our domestic passenger operations. ASK on domestic routes decreased by 2.6% year-on-year, while RPK did by 1.7%. As a result, the load factor increased by 0.6 percentage points to 63.7%. Due to an increase in individual passe
Slide 15: Domestic Passenger Operations (Change in Revenue)
Domestic Passenger Operations (Change in Revenue) 1st Quarter FY Mar/17 (JPY Bn) ▲0.4Bn Changes in customer mix (▲0.4%) ・Reputable JAL SKY NEXT ・Increase in individual passengers ・Decrease in group passengers 109.9 +0.6 due to the Kumamoto Earthquakes ▲1.0 109.4 Increase in passengers through de
Slide 16: Domestic passenger revenue commentary
In terms of “revenue per passenger”, domestic passenger revenue increased by 0.6 billion yen year-on-year due to changes in customer mix. In terms of “number of passengers”, domestic passenger revenue decreased by 1 billion yen year-on-year due to a decline in tourism demand caused by the Kumamoto
Slide 17: Major Operating Expense Items
Major Operating Expense Items Operating Expenses 1st Quarter 1st Quarter Despite lower fuel costs due to the stronger (JPY Bn) Difference y/y FY Mar/16 FY Mar/17 yen and lower fuel prices, maintenance and Fuel 59.9 49.3 ▲10.5 ▲17.6% personnel costs increased, resulting in Landing and operating exp
Slide 18: Operating expense commentary
Fuel costs decreased by 10.5 billion yen to 49.3 billion yen. Personnel costs increased by 6.3 billion yen over the previous year, as a result of reviewing the wage system and increasing the basic wages. Operating expenses as a whole decreased by 0.2% year-on-year to 275.1 billion yen. We will con
Slide 19: Impact of Fuel and FX Markets
Impact of Fuel and FX Markets Hedging Ratio for Fuel Costs Transition of Fuel Cost by Factors (as of end of June 2016) (JPY Bn) 70 100% FUEL FX Market Volume 80% 60 loaded / Approx. 59.9 Hedging, etc. 60% Approx. ▲13.7 50% 50 FX 40% +6.5 40% Approx. ▲3.3 Approx. 40 20% ▲10.5Bn 49.3 20% 15% Approx.Ap
Slide 20: Fuel costs commentary
Now, I will explain about fuel costs. The chart in the upper left corner shows the factors affecting fuel costs. Lower fuel prices contributed to a decline of 13.7 billion yen year-on-year, foreign exchange rates to a decline of 3.3 billion yen while loading volume and gains and losses on hedging
Slide 21: Major Balance Sheet Items
Major Balance Sheet Items Consolidated Balance Sheet Summary as of end of 1st Quarter FY Mar/17 End of End of FY 1st Quarter (JPY Bn) Mar/16 FY Mar/17 Difference The balance of interest- 2016/3/31 bearing debt decreased by 2016/6/30 12.8 billion yen to 79.8 Total Assets 1,578.9 1,554.2 ▲24.6 billi
Slide 22: Financial conditions commentary
As for our consolidated financial conditions as of the end of the first quarter, the balance of interest bearing debt decreased by 12.8 billion yen from the previous fiscal year-end to 79.8 billion after repaying loans and lease obligations. Future rental expenses under operating leases decreased
Slide 23: Major Cash Flow Items
Major Cash Flow Items (JPY Bn) 1st Quarter FY Mar/16 1st Quarter FY Mar/17 Difference Net Income Before Income Taxes and Non-controlling Interests 39.1 20.2 ▲18.8 Depreciation and Amortization 21.5 23.4 +1.9 Other 29.6 17.2 ▲12.4 Cash Flow from Operating Activities 90.3 60.9 ▲29.4 Capital Expenditur
Slide 24: Cash flow commentary
Cash flow from operating activities decreased by 29.4 billion yen year-on-year, resulting in cash inflows of 60.9 billion yen. Cash flow from investing activities shows cash outflows of 65.7 billion yen, an increase in cash outflows of 10.2 billion yen year-on-year. In total cash flow, we reporte
Slide 25: Further actions to take to accomplish financial target
Further actions to take to accomplish financial target Aim to reach our target of Operating Profit through pursuing Divisional Profitability Management System Outline Operating 1st Quarter July Further actions to take Profit FY Mar/17 (Estimate) （Result） a. Increase entrusted ground handling a. Revi
Slide 26: Outlook commentary
We have started this fiscal year rather unfavorably so far. For the rest of the period, we will endeavor to maximize revenue by assigning larger aircraft on higher demand routes and operating non-scheduled additional flights, while reviewing the expenses for outsourced services and pursuing the div
Slide 27: Fly into tomorrow.
Fly into tomorrow. Finance & Investor Relations, Japan Airlines
Slide 28: References: Operating Results for International Passenger by Major Routes
《References》 Operating Results for International Passenger by Major Routes Passenger Revenue Passengers y/y Proportion of whole Int’l (‘000) 1Q FY Mar/16 1Q FY Mar/17 y/y (%) 1Q FY Mar/17 1Q FY Mar/16 1Q FY Mar/17 America 271 291 +7.5% America ▲0.9% 24% 27% Europe 158 159 +0.5% Europe ▲11.9% 16% 15%
Slide 29: Reference: Number of Aircraft
《Reference》 Number of Aircraft End of Mar/2016 End of Jun/2016 Difference Owned Leased Total Owned Leased Total Boeing 777-200 12 0 12 12 0 12 - Boeing 777-200ER 11 0 11 11 0 11 - Boeing 777-300 4 0 4 4 0 4 - Boeing 777-300ER 13 0 13 13 0 13 - Large-sized Total 40 0 40 40 0 40 - Boeing 787-8 23 0 23
Slide 30: Mar/2017 Earnings Forecast (Consolidated) on April 28, 2016
- No change from that published Mar/2017 Earnings Forecast (Consolidated) on April 28, 2016 Consolidated Financial Results Operational Preconditions Mar/2016 Mar/2017 Mar/2016 Mar/2017 (JPY Bn) difference y/y Results Forecast Results Forecast Revenue 1,336.6 1,343.0 +6.3 +0.5% ASK* Int’l +1.3% ▲0.6%
Slide 31: Disclaimer
Disclaimer This contents contains descriptions of the future expectations, outlooks, objectives and plans etc. of Japan Airlines Co., Ltd. (hereafter "the company") and related Group companies (hereafter "the Group"). These are based on information available at the time when these materials were cre