Japan Airlines Co., Ltd. · TSE:9201
Japan Airlines — Q3 FY2013 Earnings Presentation
44 slides from Japan Airlines's earnings presentation, Jan 31, 2014
Slide 1: Financial Results 3rd Quarter FY3/2014 (FY2013)
JAPAN AIRLINES Financial Results 3rd Quarter Mar / 2014(FY2013) Norikazu Saito Managing Executive Officer 31 January, 2014
Slide 2: Contents
Contents N OVERVIEW OF 382 QUARTER FY3/14 FINANCIAL RESULTS REVISED CONSOLIDATED FINANCIAL AND DIVIDEND FORECAST FOR FY3/14 STOCK SPLIT DETAILS OF 382 QUARTER FY3/14 (3Q FY13) FINANCIAL RESULTS CPs ) SUPPLEMENTAL REFERENCES
Slide 3: Overview of 3rd Quarter FY3/14 Financial Results
Overview of 3rd Quarter FY3/14 Financial Results Operating Revenue Operating Profit （JPY Bn) （JPY Bn） Operating Profit 158.1 Margin 989.9 160 19% 990 137.4 960 942.0 140 16% ＋5.1% 16.8% 930 900 120 13.9% 13% 870 100 10% 3Q FY3/13 3Q FY3/14 3Q FY3/13 3Q FY3/14 FX Markets Despite weak yen, operating p
Slide 4: Operating revenue and profit commentary
During the reporting period, operating revenue increased by 5.1% year-on-year to 989.9 billion yen, due to an increase in international and domestic passenger revenues. On the other hand, operating profit declined by 20.6 billion yen from the previous year to 137.4 billion yen, owing to an increase
Slide 5: Impact from Currency Market
Impact from Currency Market Breakdown of the Impact on Our Operating Profit （Bn JPY） FX Impact Excl. FX ▲35.9 +15.2 Revenue Expenses (Excl. Fuel) 158.1 +18.2 ▲15.5 Fuel Revenue Expenses ▲38.6 ▲14.5 137.4 122.2 +29.7 3Q FY3/13 Estimated Operating Profit 3Q FY3/14 （80.1JPY/USD） including FX impact （98
Slide 6: Currency impact commentary
The positive impact of foreign exchange rates on revenue was 18.2 billion yen, against our operating profit of 158.1 billion yen last year. The impact of foreign exchange rates on expenses excluding fuel costs was 15.5 billion yen and also 38.6 billion yen was on fuel cost. Operating profit for the
Slide 7: Revised Consolidated Financial Forecast for FY3/14
Revised Consolidated Financial Forecast for FY3/14 Upward Revision of Operating Profit Forecast Upward Revision of Net Income Based on 3rd quarter FY3/14 results, we revised our operating In addition to a 3.0 Bn yen increase in Operating Profit, 2.0 profit forecast. Bn yen in Extraordinary Income an
Slide 8: Forecast revision commentary
Taking into account financial results for the third quarter, we revised our operating profit forecast upward by 3 billion yen from the previous forecast of 155 billion yen announced on last October 31 to 158 billion yen. As a result, our operating profit margin is expected to be 12.2%. Compared to l
Slide 9: Revised Dividend Forecast for FY3/14 -1-
Revised Dividend Forecast for FY3/14 -1- Change in our Dividend Calculation Policy Before FY3/14 and After Dividend Payout Ratio Approx. 20% of Consolidated approx. 20% of our Net Income for the fiscal year Consolidated Net Income excluding Income Tax- Deferred Background From the end of FY3/14, Net
Slide 10: Dividend policy commentary
We have announced that our dividend payout ratio would be approximately 20% of our consolidated net income, taking into account our basic policy to proactively return benefits to our shareholders. From this fiscal year onwards, we decided to exclude Income Tax-Deferred from consolidated net income w
Slide 11: Revised Dividend Forecast for FY3/14 -2-
Revised Dividend Forecast for FY3/14 -2- Dividend Forecast Calculating simulation Estimated DPS for FY3/14 based FY3/14(E) on NEW dividend payout policy (JPY Bn) FY3/13 (A) New Announced on Forecast 2013/10/31 Consolidated Net 171.6 JPY Bn 148.0JPY Bn 128.0JPY Bn Dividends per share Income －） Income
Slide 12: Dividend per share commentary
DPS for this fiscal year is estimated 147yen based on calculation with our new dividends policy. We must apologize for announcing the forecast of reducing dividends The operating environment remains severe, but we will continue to do our best to maximize profit. 6
Slide 13: Stock Split
Stock Split Summery Two for One common stock split (1:2) Total numbers of share issued: 181,352Mn ⇒ 362,704Mn Shares which JAL refused to register in the shareholder’s list(*) pursuant to provisions of the Civil Aeronautics Law will also be split (*)adjusted shares held by foreigners Schedule Record
Slide 14: Stock split commentary
The Board of Directors has approved at a meeting on January 31,2014 a stock split of our common shares. We are aware of general price range of a shareholder’s investment in companies listed on the first section of the Tokyo Stock Exchange, and will undertake a two-for-one stock split to develop an e
Slide 15: Details of 3rd Quarter FY3/14 Financial results
Details of 3rd Quarter FY3/14 Financial results
Slide 16: Intentionally left blank
@ a JAPAN AIRLINES Intentionally left blank
Slide 17: Consolidated Financial Results
Consolidated Financial Results Consolidated Financial Results 3rd Quarter FY3/14 3rd Quarter (JPY Bn) 3Q FY3/13 3Q FY3/14 y/y y/y (Oct-Dec) (1) Revenue: Revenue 942.0 989.9 +5.1% 330.6 +7.4% 989.9Bn JPY, Air Transportation Segment 848.9 883.6 +4.1% 294.5 +6.2% y/y +5.1% Operating Expense 783.8 852.4
Slide 18: Consolidated results commentary
During the reporting period, operating revenue increased by 5.1% year-on-year to 989.9 billion yen, mainly due to an increase in international and domestic passenger revenues. Operating expense increased by 8.7% year-on-year to 852.4 billion yen, largely due to an increase in supply and various cost
Slide 19: Changes of Operating Profit
Changes of Operating Profit 3Q FY3/2014 ASK y/y： +3.6% RPK y/y： +3.8% ▲20.6Bn （JPY：Bn） ▲13.1%) (▲ Other Revenue Fuel Domestic Int’l Int’l +21.1 ▲26.7 Passenger Cargo Operation Passenger +1.4 +2.3 Coupled Cost Revenue Other +22.9 Coupled Cost Cost ▲5.1 +9.5% ▲3.9 158.1 +0.4% +6.1% ▲32.7 ▲14.4% ▲8.1%
Slide 20: Operating profit change commentary
As for revenues, international passengers and domestic passengers reported an increase in revenue of 22.9 billion yen, and 1.4 billion yen respectively. As a result, revenues including other revenues increased by 47.8 billion yen. As for expenses, in addition to an increase in supply, fuel costs inc
Slide 21: International Passenger Operations (Operating Results)
International Passenger Operations (Operating Results) International Passenger 3rd Quarter 3Q FY3/13 3Q FY3/14 y/y y/y (Oct-Dec) (1) Passenger Revenue International Passenger (JPY Bn) 308.3 331.3 +7.5% 109.1 +11.3% Revenue: JPY 331.3 Bn ASK (MN seat km) 33,387 34,842 +4.4% 11,752 +4.4% y/y +7.5% RPK
Slide 22: International passenger commentary
Both ASK and RPK on international routes increased by 4.4% from the previous year, and the load factor as at 76.2%. In addition to positive demand of business trips, due to an increase in passenger traffic on mid- and long distances routes such as to Europe and Southeast Asia, as well as an increase
Slide 23: International Passenger Operations (Changes of Revenue)
International Passenger Operations (Changes of Revenue) 3Q FY3/2014 Strong Demand on Europe and (Bn JPY) Southeast Asia Routes +22.9Bn (+7.5%) Load Factor Europe 78.0% (y/y +1.2%) 331.3 Southeast Asia 76.5% (y/y +3.1%) +7.7 Expansion of SKY SUITE 777 +15.2 Improved Load Factor and Yield - Strong Dem
Slide 24: International revenue commentary
During the reporting period, demand on Korea route was stagnant, but European and Southeast Asia routes saw a high load factor and unit price. By expanding operating routes of the SKY SUITE 777 and 767, offering upgrades in comfort and functionality , load factor and yield have increased on these ro
Slide 25: Domestic Passenger Operations (Operating Results)
Domestic Passenger Operations (Operating Results) Domestic Passenger 3rd Quarter 3Q FY3/13 3Q FY3/14 y/y y/y (Oct-Dec) (1) Passenger Revenue Domestic Passenger 373.4 374.9 +0.4% 123.2 +0.2% (JPY Bn) Revenue: 374.9 Bn JPY, y/y +0.4% ASK (MN seat km) 27,687 28,413 +2.6% 9,184 +1.8% RPK (MN passenger k
Slide 26: Domestic passenger commentary
ASK and RPK on domestic routes increased by 2.6% and 2.9% from the previous year, and the load factor was 63.7%. On the other hand, as there was strong demand of group passengers, yield and unit price dropped by 2.5% and 3.4% respectively. However, the growth of revenue passengers was greater than t
Slide 27: Domestic Passenger Operations (Changes of Revenue)
Domestic Passenger Operations (Changes of Revenue) 3Q FY3/2014 (Bn JPY) Robust demand of group +1.5Bn passengers (+0.4%) 374.9 • The Sengu Ceremony of Izumo Taisha 373.4 Shrine attracted many passengers to the Sanin district. ▲12.6 +14.1 Robust demand at year-end • Offered new discount fare called T
Slide 28: Domestic revenue commentary
During the reporting period, domestic routes enjoyed robust demand of group passengers. In addition to strong demand from regional cities around Japan, the Sengu Ceremony of Izumo Taisha Shrine attracted many passengers to the Sanin district such as Izumo. We also offered a new discount fare called
Slide 29: Major Operating Expense Items
Major Operating Expense Items Operating Expenses Fuel cost increased by 3Q 3rd Quarter (JPY Bn) 3Q FY3/13 difference % y/y difference 26.7 Bn JPY due to an FY3/14 (Otc-Dec) increase in supply and Fuel 185.6 212.3 +26.7 +14.4% 71.2 +9.7 weak yen Landing fees 56.6 60.8 +4.2 +7.4% 20.0 +1.3 Maintenance
Slide 30: Operating expense commentary
Fuel costs increased by 26.7 billion yen, up 14.4%, landing fees increased by 4.2 billion yen, up 7.4% from last year, due to the weaker yen and an increase in supply. The breakdown of this increase of the fuel cost consists of an increase of 38.6billion yen due to the weaker yen, an increase of 8.4
Slide 31: Major Balance Sheet Items
Major Balance Sheet Items Consolidated Balance Sheet Summary as of End of 3rd Quarter FY3/14 End of 3rd Quarter The balance of interest- End of FY2012 (JPY Bn) FY3/14 difference bearing debt is reduced 2013/3/31 2013/12/31 to 128.2 Bn JPY after Total Assets 1,216.6 1,305.1 +88.5 repayment Cash and D
Slide 32: Balance sheet commentary
Outstanding interest-bearing debts decreased by 31.9 billion yen from the previous fiscal year to128.2 billion yen, as we repaid lease obligations and long- term loans. Our equity ratio increased by 4.8 points to 51.2%, as we reported a net income for the reporting period. 15
Slide 33: Supplemental References
@ JAPAN AIRLINES NU \ \ \ SUPPLEMENTAL REFERENCES
Slide 34: Flight Frequency and Fleet Plans for FY2014 (International)
《Supplemental Reference》 Flight Frequency and Fleet Plans for FY2014 (International) announced on January 22, 2014 ～) New services, flight frequency increase and flight schedule changes at Tokyo (Haneda) Airport (March 30,2014～ 【New services and flight frequency increase】 】 【Flight schedule and airc
Slide 35: Flight Frequency and Fleet Plans for FY2014 (Domestic)
《Supplemental Reference》 Flight Frequency and Fleet Plans for FY2014 (Domestic) announced on January 22, 2014 【New services (Resumption) 】 【Flight frequency decrease 】 Route Change (round trip) Period Route Change (round trip) Haneda = Sapporo 17 daily⇒16 daily Itami = Matsumoto 0 daily⇒1 daily Augu
Slide 36: Major Cash Flow Items
《Supplemental Reference》 Major Cash Flow Items (JPY Bn) 3Q FY3/13 3Q FY3/14 difference Net income before income taxes and minority interests 154.0 136.1 ▲17.8 Depreciation 61.6 61.9 +0.2 Other ▲16.7 ▲14.4 +2.3 Cash Flow from Operating Activities 198.9 183.6 ▲15.3 Capital Expenditure (1) ▲110.6 ▲97.1
Slide 37: Impact from Fuel and Currency Markets
《Supplemental Reference》 Impact from Fuel and Currency Markets Sensitivity for Fuel Costs Hedging Ratio for Fuel Costs (As of End of 3Q FY3/14) (Without Hedging) 100% Approx Crude Oil 2.0 Bn JPY 85% ） (Change in 1 USD/bbl） Approx Per Year 80% 65% FX 2.5 Bn JPY (Change in 1 JPY/USD) Per Year 60% Appr
Slide 38: Revenue of International Routes by Geographical segment
《Supplemental Reference》 Revenue of International Routes by Geographical segment Passenger Revenue (% of the whole int’l revenue) Passengers 3Q FY3/14 3Q FY3/14 (%) 3Q FY3/13 3Q FY3/14 Y/Y Y/Y (‘000) 3Q FY3/13 3Q FY3/14 Y/Y Y/Y (Oct-Dec) (Oct-Dec) Trans Pacific 34.0% 34.0% +0.0pt 34.0% ▲0.5pt Trans
Slide 39: Number of Aircraft in Service
《Supplemental Reference》 Number of Aircraft in Service End of Mar/2013 End of Dec/2013 2013/3/31 2013/12/31 Changes Owned Leased Total Owned Leased Total Boeing 777-200 15 0 15 15 0 15 - Boeing 777-200ER 11 0 11 11 0 11 - Boeing 777-300 7 0 7 7 0 7 - Boeing 777-300ER 13 0 13 13 0 13 - Large-sized To
Slide 40: FY3/14 Earnings Forecast (Consolidated)
《Supplemental Reference》 FY3/14 Earnings Forecast (Consolidated) FY3/14 FY3/14 FY3/14 FY3/13 FY3/14 Prev. (JPY Bn) Prev. Forecast difference Results New Forecast New Forecast (Oct 31,2013) Forecast (Oct 31,2013) Revenue 1,238.8 1,291.0 1,286.0 +5.0 ASK Int’l 103.4 103.3 Operating Doms 102.2 102.5 Ex
Slide 41: FY3/14 Earnings Forecast (Balance Sheets / Cash Flow)
《Supplemental Reference》 FY3/14 Earnings Forecast (Consolidated Balance Sheets / Cash Flow) Consolidated Balance Sheet FY3/14 Prv. Forecast (JPY Bn) End of FY3/13 Result FY3/14 New Forecast Difference (Oct 31,2013) Total Assets 1,216.6 1,310.0 1,289.0 +21.0 Interest-bearing Debt 160.1 132.0 137.0 ▲5
Slide 42: FY3/14 Earnings Forecast (Air Transportation Segment)
《Supplemental Reference》 FY3/14 Earnings Forecast（ Air transportation Segment ） International Domestic y/y (%) 1H 2H FY3/14 1H 2H FY3/14 (Exclude Load (Result) (Forecast) (Forecast) (Result) (Forecast) (Forecast) Factor) ASK +4.4% +2.4% +3.4% +3.0% +1.4% +2.2% RPK +4.5% +3.6% +4.0% +2.7% +2.9% +2.8%
Slide 43: Fly into tomorrow.
Fly into tomorrow. Contact: Finance, Japan Airlines +81-3-5460-3068
Slide 44: This contents contains descriptions of the future expectations, outlooks, objectives and plans etc. of
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 created by the