Japan Airlines Co., Ltd. · TSE:9201
Japan Airlines — Q3 FY2019 Earnings Presentation
34 slides from Japan Airlines's earnings presentation, Jan 31, 2020
Slide 1: Financial Results 3rd Quarter Mar/2020 (FY2019)
JAPAN AIRLINES Co., Ltd. Financial Results 3 rd Quarter Mar/2020（FY2019） January 31, 2020 ©Japan Airlines, ALL rights reserved.
Slide 2: Today's Topics
Today’s Topics OVERVIEW OF FINANCIAL RESULTS FOR P.3 3rd Quarter MAR/20 REVISED CONSOLIDATED FINANCIAL P.5 FORECAST FOR MAR/20 DETAILS OF FINANCIAL RESULTS FOR P.7 3rd Quarter MAR/20 REFERENCES P.18 Health and Productivity SKYTRAX FTE Management Brand The World’s Best Economy Class Accessibility Lea
Slide 3: Overview of Financial Results for 3rd Quarter Mar/20
Overview of Financial Results for 3 rd Quarter Mar/20 Domestic Passenger was robust but INT’L Passenger & Cargo was weak Operating Profit decreased year-on-year Operating Revenue Operating profit・Net profit (1)・Operating profit margin Figures in ( ) exclude （JPY Bn） （JPY Bn） the depreciation met
Slide 4: Overview of third-quarter results (speaker notes)
I will explain the overview of the third-quarter financial result of the fiscal year 2019, ending March 2020. Operating Revenue decreased by 0.1 billion yen to 1 trillion and 130.8 billion yen this year due to weak International Passenger demand and Cargo demand. Operating Expense increased by
Slide 5: FY2020 Tokyo Metropolitan Airports Routes
FY2020 Tokyo Metropolitan Airports Routes Haneda INT’L Network Expansion from Mar. 29 with the Additional 12 slots Route Effective 1 Haneda＝Los Angeles New Service 2 Haneda＝Chicago New Service (Transferred from Narita) Continental United 3 States Routes Haneda＝Dallas New Service (Transferred from
Slide 6: Haneda and Narita additional flights (notes)
This slide summarizes the additional flights to Haneda and Narita Airports. Haneda expansion is from March 29. We will use all the slots given to us from the day one to add 12 more flights. From Narita Airport, new flights to Vladivostok or Bengaluru will launch. Moreover, ZIPAIR will start its
Slide 7: FY2019 Earnings Forecast
FY2019 Earnings Forecast Operating Revenue Forecast decreases again by 30 billion yen due to sluggish INT’L PAX/CGO Despite the steady cost reduction, Operating Profit Forecast decreases by 30 billion yen and so does Net Profit Forecast by 21 billion yen but no change in Dividend Forecast Revenu
Slide 8: Forecast revision (notes)
I will explain about the forecast revision. Recent International Passenger trend has been reflected to the downward revision. International Passenger Revenue Forecast is down by 11 billion yen due to sluggish Japan- outbound business demand, many cancelled flights by typhoons or the oversupply s
Slide 9: Intentionally Left Blank
INTENTIONALLY LEFT BLANK ©Japan Airlines, ALL rights reserved. 6
Slide 10: Consolidated Financial Results
Consolidated Financial Results 3Q 3Q 3rd Quarter （JPY Bn） MAR/19 MAR/20 Diff. y/y ratio (Oct-Dec)(6) Diff. y/y ratio Operating Revenue 1,131.0 1,130.8 ▲0.1 ▲0.0% 371.0 ▲9.8 ▲2.6％ International Passenger 403.4 392.1 ▲11.3 ▲2.8% 126.1 ▲8.1 ▲6.1％ Domestic Passenger 404.7 415.4 +10.7 +2.7% 138.5 +2.0 +1
Slide 11: Changes in Operating Profit (Revenues/Expenses)
Changes in Operating Profit（ Revenues/Expenses ） 3 rd Quarter Mar/20 （JPY Bn） ＋ stands for profit increase (revenue increase, cost decrease) ▲ stands for profit decrease (revenue decrease, cost increase) ▲25.3 Bn ASK y/y： ＋1.5% (▲17.4%) RPK y/y： ＋1.4％ ▲18.5 Bn (▲12.7%) Domestic Other Fuel Maintenanc
Slide 12: Changes in operating profit (notes)
On this slide, I will explain the changes in Operating Profit. International Passenger Revenue decreased by 11.3 billion yen year-on-year. So did Cargo & Mail Revenue by 8.1 billion yen. Domestic Passenger Revenue increased by 10.7 billion yen with strong demand that was steadily captured by us.
Slide 13: Changes in Operating Profit (Market/Others)
Changes in Operating Profit（ Market/Others ） 3 rd Quarter Mar/20 (JPY Bn） ＋ stands for profit increase (revenue increase, cost decrease) ▲25.3 Bn ▲ stands for profit decrease (revenue decrease, cost increase) Impact From Currency Market +1.2 Bn (▲17.4%) Revenues ▲3.8 Bn Fuel Volume +0.8 Expenses +5.
Slide 14: Market impact on operating profit (notes)
This slide shows the market impact to Operating Profit, which was very limited. ©Japan Airlines, ALL rights reserved. 9-S
Slide 15: International Passenger Operations
International Passenger Operations International Passenger Change in Revenue （JPY Bn） 3Q 3Q 3rd Quarter MAR/19 MAR/20 y/y (Oct-Dec)(4) y/y ▲11.3 Bn (▲2.8%) Passenger Revenue (JPY Bn) 403.4 392.1 ▲2.8% 126.1 ▲6.1% The Passenger Service System Effects Included Passengers 403.4 (’000) 6,872 6,769 ▲1.5%
Slide 16: International passenger revenue (notes)
International Passenger Revenue decreased to 392.1 billion yen, down 2.8% year- on-year. Revenue per Passenger decreased by 1.3% year-on-year. Sluggish Japan- outbound business demand and the oversupply situation especially on China route caused Net Unit Price to fall. The flexible yield manag
Slide 17: Domestic Passenger Operations
Domestic Passenger Operations Domestic Passenger Change in Revenue （JPY Bn） 3Q 3Q 3rd Quarter y/y (Oct-Dec)(4) y/y MAR/19 MAR/20 ＋10.7 Bn Passenger Revenue 404.7 415.4 ＋2.7% 138.5 ＋1.5% (＋2.7%) (JPY Bn) ・ Demand Rise during Passengers (’000) 26,437 27,124 +2.6% 9,117 +1.0% the Long Holidays(＋) ・ Inc
Slide 18: Domestic passenger revenue (notes)
Domestic Passenger Revenue increased to 415.4 billion yen, up 2.7% year-on-year. Typhoon Hagibis caused many flights cancelled but individual passenger demand still remains strong and Passenger Number increased 2.6% year-on-year. Load Factor also rose by 1.2 point. Revenue per Passenger increase
Slide 19: Major Operating Expense Items
Major Operating Expense Items Operating Expenses 3Q 3Q 3rd Quarter （JPY Bn） Diff. y/y ratio Diff. y/y ratio MAR/19 MAR/20 (Oct-Dec)(4) Fuel 191.7 189.6 ▲2.0 ▲1.1% 61.9 ▲4.4 ▲6.7％ Landing and navigation fees 64.9 65.2 +0.3 +0.5% 21.7 +0.0 +0.3％ Maintenance 55.0 59.6 +4.5 +8.3% 19.6 +1.3 +7.2％ Sales c
Slide 20: Operating expenses (notes)
Now this slide shows the details of Operating Expenses. The figures in brackets exclude the depreciation method change. Because of our cost reduction measures, Operating Expenses are under control. We will pursue more. ©Japan Airlines, ALL rights reserved. 12- S
Slide 21: Major Balance Sheet Items and Cash Flow Items
Major Balance Sheet Items and Cash Flow Items Consolidated Balance Sheet End of End of 3rd （JPY Bn） Quarter Mar/20 Diff. Remarks Mar/19 Total Assets 2,030.3 1,941.7 ▲88.5 Cash and Deposits 82.7 Bn. yen injection to Pension Fund in Sep. and （incl. Certificate of Deposits etc） 522.0 326.4 ▲195.6 tempo
Slide 22: Balance sheet and cash flow (notes)
On this slide, You will see Balance Sheet and Cash Flow. Please note that there should be no problem with the substantial decrease of 195.6 billion yen in Cash and Deposits. This include cash injection to Corporate Pension Fund of 82.7 billion yen or temporary cash-out equivalent to 30 billion y
Slide 23: Revenue of International Routes by Geographic Segment
《 Reference 》 Revenue of International Routes by Geographic Segment Passenger Revenue 3Q 3Q Component Ratio (%) Cumulative 3Months y/y y/y 3Q Mar/19 3Q Mar/20 3Q 3Months America +6.6% +0.3% 26% 28% 28% Europe ▲4.9% ▲3.0% 17% 17% 15% Asia/Oceania ▲4.2% ▲6.8% 32% 31% 34% China ▲7.0% ▲17.4% 11% 11% 10%
Slide 24: International passenger (notes)
I will explain briefly about International Passenger. The new system captured more inbound demand while Japan-outbound business demand remained weak. By doing this, the revenue was maximized. The China route was in an oversupply situation and our load factor worsened substantially. Looking forwa
Slide 25: Number of Aircraft
《 Reference 》 Number of Aircraft End of Mar/19 End of 3rd Quarter/20 (March 31, 2019) (December 31, 2019) Diff. Owned Leased Total Owned Leased Total Airbus A350-900 0 0 0 5 0 5 +5 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
Slide 26: FY2019 Earnings Forecast
《 Reference 》 FY2019 Earnings Forecast Consolidated Balance Sheet End of End of FY2018 FY2019 （JPY Bn） Diff. Previous New Results (1) Forecast Forecast Total Assets 2,030.3 2,010.0 1,962.0 ▲48.0 Balance of Interest-bearing 142.3 171.0 171.0 - debts Shareholders’ Equity 1,165.1 1,174.0 1,166.0 ▲8.0 (
Slide 27: Intentionally Left Blank
INTENTIONALLY LEFT BLANK ©Japan Airlines, ALL rights reserved. 17
Slide 28: ESG Management towards achievement of SDGs
《Reference》 ESG Management towards achievement of SDGs ※Originally disclosed on February 25,2019 In this Medium Term Management Plan, we look to identify priority issues from the viewpoint of ESG management. And strive to solve social issues through to achieve SDGs *1 in 2030. 2030 Fields Priority I
Slide 29: Social
《Reference》 ESG Contribute to achieve SDGs, through our business activities, toward the realization of a sustainable society and corporate value increase Established The JAL Group Code of Conduct “Commitment to Society” Environmental Social Governance ・High transparency and strict ・Low-Carbon In
Slide 30: Financial Strategy and Capital policy ①
《Reference》 Financial Strategy and Capital policy① ※Originally disclosed on February 25,2019 Capital investments will be made within cash flow from operating activities. Approximately 2/3 of the total investment will be actively used for growth investment to increase corporate value. Aircraft invest
Slide 31: Financial Strategy and Capital policy ②
《Reference》 Financial Strategy and Capital policy② ※Originally disclosed on February 25,2019 We will strategically allocate capital to increase corporate value, while maintaining a firm financial structure with high capital efficiency. Improve asset efficiency Further increase Capital allocation and
Slide 32: Financial Strategy and Capital policy ③
《Reference》 Financial Strategy and Capital policy③ ※Originally disclosed on February 25,2019 （Partial updated ） Stable financial structure with high capital efficiency Enhancement of shareholder return and capital allocation for corporate value increases Financial structure Capital efficiency Shareh
Slide 33: Fly into tomorrow.
Fly into tomorrow. Finance & Investor Relations, Japan Airlines ©Japan ©Japan Airlines, ALL Airlines, ALL rights rightsreserved. reserved.
Slide 34: Disclaimer
Disclaimer This content 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 crea