Japan Airlines Co., Ltd. · TSE:9201
Japan Airlines — Q1 FY2018 Earnings Presentation
32 slides from Japan Airlines's earnings presentation, Jul 31, 2018
Slide 1: Financial Results 1st Quarter Mar/2019 (FY2018)
JAPAN AIRLINES Co., Ltd. 日本航空株式会社 Financial Results 2019年3月期第1四半期 1st Quarter Mar/2019（FY2018） 決算説明会 10 November 2017 14 November 2017 International Friendly Match International Friendly Match vs Brazil National Team vs Belgium National Team July 31, 2018
Slide 2: Today's Topics
Today’s Topics P.1 P.2 P.10 ※JAL Corporate Website ※The Award for Passenger Service System Project
Slide 3: Overview of Financial Results for 1st Quarter Mar/19
Overview of Financial Results for 1st Quarter Mar/19 Resulted in an increase in both revenue and operating profit year-on-year while progressing capacity expansion A new international mid & long-haul low-cost carrier will be established (Disclosed on May 14, 2018, Its preparatory company has bee
Slide 4: Overview of first-quarter financial results (commentary)
Now, I will present the overview of the first-quarter financial results for the fiscal year ending March 31, 2019. Our total ASK growth rate was 5% year-on-year in this quarter due to capacity expansion mainly in international routes. Together with strong demand in international passenger and th
Slide 5: Consolidated Financial Results
Consolidated Financial Results Consolidated Financial Results 1ST QUARTER Mar/19 1st Quarter 1st Quarter （JPY Bn） Diff. y/y Mar/18 Mar/19 Operating Revenue 314.8 342.1 ＋27.2 ＋8.7% Air Transportation Segment 285.8 313.0 ＋27.1 ＋9.5% Operating Expense 290.0 317.1 ＋27.1 ＋9.3% Air Transportation Segment
Slide 6: Consolidated financial results (commentary)
Now, I will explain our consolidated financial results for the first-quarter financial results for the fiscal year ending March 31, 2019. Operating profit margin declined, however, both EBITDA and EBITDAR margin as cash flow generation indicator improved. 2-S
Slide 7: Changes in Operating Profit (Revenues / Expenses)
Changes in Operating Profit（ Revenues ／ Expenses ） 1st Quarter Mar/19 （ JPY Bn ） ＋ stands for profit increase (revenue increase, cost reduction) ▲ stands for profit decrease (revenue decrease, cost increase) ASK y/y ： +5.0% ＋0.1Bn RPK y/y ： +6.3% (＋0.7%) Other Revenues Fuel Cargo & Mail ＋3.7 Domesti
Slide 8: Changes in operating profit (commentary)
Now, I will explain about the changes in operating profit. Revenues from International Passenger increased by 19.2 billion yen because of passenger carriage increase due to the capacity growth and optimization of cabin configurations as well as the increase in fuel surcharge. Revenues from Dom
Slide 9: Changes in Operating Profit (Market / Others)
Changes in Operating Profit（ Market ／ Others ） 1st Quarter Mar/19 ＋ stands for profit increase (revenue increase, cost reduction) （ JPY Bn ） ▲ stands for profit decrease (revenue decrease, cost increase) +0.1Bn Impact from (+0.7%) Currency Market +2.4Bn Revenue +0.3Bn Cost +2.1Bn (Excl. Market Impac
Slide 10: Market impact on operating profit (commentary)
This page explains changes in operating profit from the viewpoints of market impact and others. The market impact on profit was limited to the decrease of 0.9 billion yen year- on-year. Despite the fuel cost increase due to the higher fuel prices, the increase of fuel surcharge revenue and hedgi
Slide 11: International Passenger Operations
International Passenger Operations International Passenger Change in Revenue （ JPY Bn ） 1st Quarter 1st Quarter y/y ＋19.2Bn Mar/18 Mar/19 (＋18.2%) Passenger Revenue(1) 105.5 124.8 +18.2% 124.8 (JPY Bn) (123.4) (+16.9%) +10.8 Passengers (’000) 2,038 2,251 +10.5% 105.5 ＋8.4 ・Stable Outbound Demand(＋)
Slide 12: International routes (commentary)
For International routes, the number of passenger increased by 10.5% year on year as a result of both outbound and inbound demand. The revenue per passenger rose by 7.0%. The graph on the right bottom shows the analysis of the changes. The net unit price increased by 2% with the improved yield m
Slide 13: Domestic Passenger Operations
Domestic Passenger Operations Domestic Passenger Change in Revenue 1st Quarter 1st Quarter （ JPY Bn ） y/y Mar/18 Mar/19 ＋1.1Bn Passenger Revenue(1) 117.2 +1.0% (JPY Bn) 116.1 (118.6) (+2.2%) (＋1.0%) Passengers (’000) 8,070 8,297 +2.8% ・Increase in individual ASK 8,820 8,962 +1.6% passengers(＋) 117.2
Slide 14: Domestic routes (commentary)
Next, for domestic routes. The number of passenger increased by 2.8% as a result of the increased demand of individual passengers. For the revenue per passenger, it appeared to have declined by 1.8%. However, without the deduction of 1.4 billion settlement adjustment, it should have remained n
Slide 15: Major Operating Expense Items
Major Operating Expense Items Operating Expenses 1st Quarter 1st Quarter (JPY Bn) Diff. y/y Mar/18 Mar/19 Fuel 50.3 60.3 +10.0 +20.0% Landing and navigation fees 20.1 21.2 +1.1 +5.5% Maintenance 17.8 18.5 +0.7 +4.2% Sales commissions (Air Transport) 4.0 4.7 +0.6 +16.9% Aircraft (1) 26.1 27.4 +1.2 +4
Slide 16: Operating expense items (commentary)
Now, I will explain the major operating expense items, which totaled to 317.1 billion yen, up 9.3% year-on-year. Without the increase of fuel expense and 4 billion yen of the new system related expenses, the rate of the increase of the remaining expenses was about 5% year- on-year, which was the
Slide 17: Impact of Fuel and FX Markets
Impact of Fuel and FX Markets Hedge Ratio for Fuel Costs Transition of Fuel Cost by Factors (As of end of June 2018) (JPY Bn) 100% Volume FUEL FX 80 Market increase/ 80% +14.1 FX Hedging 60 60.3 ▲1.4 ▲2.7 50.3 60% Approx. Approx. 40% 40% 40 40% ＋10.0Bn Approx. Approx. 20 (＋20.0%) 20% 15% 15% Approx.
Slide 18: Fuel and FX markets impact (commentary)
I will explain the impact of Fuel and FX Markets. The top left graph shows the transition of factors in fuel cost. The top right graph shows the ratio of hedged fuel costs as of the end of June. For this year, nearly 40% of the total fuel costs have been already hedged, which is equivalent to th
Slide 19: Major Balance Sheet Items and Cash Flow Items
Major Balance Sheet Items and Cash Flow Items End of Balance Sheet End of Mar/18 1st Quarter Diff. （JPY Bn） Mar/19 Total Assets (1) 1,853.9 1,878.6 +24.6 Cash and Deposits (2) 448.8 420.6 ▲28.1 Balance of Interest-bearing Debt (3) 125.7 121.7 ▲4.0 1 Total Assets amount as of the end of March, 2018 h
Slide 20: Balance sheet and cash flow (commentary)
Please be noted that page 9 shows our balance sheet and our cash flows. From page 10, please find several references, including Revenue of International Routes by Geographic on page 10 and Number of Aircraft on page 11. On Page 12 and 13, there the forecast of FY2018 Earnings, balance sheet an
Slide 21: Revenue of International Routes by Geographic Segment
《 Reference 》 Revenue of International Routes by Geographic Segment Passenger Revenue Revenue Passengers Carried y/y Component Ratio (‘000) 1Q Mar/18 1Q Mar/19 y/y (%) 1Q Mar/19 1Q Mar/18 1Q Mar/19 America 312 330 +5.9% America +9.9% 28% 26% Europe 182 182 +0.0% Europe +20.8% 16% 17% Asia/Oceania 98
Slide 22: Number of Aircraft
《Reference》 Number of Aircraft End of Mar/18 End of 1st quarter Mar/19 (March 31, 2018) (June 30, 2018) Diff. 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
Slide 23: FY2018 Earnings Forecast
《Reference》 FY2018 Earnings Forecast ※No change from the figures disclosed on April 27, 2018 Revenue and Expenditure Plan Operational Preconditions・Dividend FY2018 FY2017 FY2018(Plan) （JPY Bn） FY2017 Diff. y/y ※y/y (Plan) Int’l +2.4% +6.8% Operating Revenue 1,383.2 1,455.0 +71.7 +5.2% International
Slide 24: FY2018 Earnings Forecast
《Reference》 FY2018 Earnings Forecast ※No change from the figures disclosed on April 27, 2018 Balance Sheet End of End of （JPY Bn） Diff. FY2017 FY2018 (Plan) Total Assets (1) 1,853.9 1,933.0 +79.0 Balance of Interest-bearing 125.7 164.0 +38.2 debts (2) 1 Total Assets amount as of the end of FY2017 ha
Slide 25: Intentionally Left Blank
2 JAPAN AIRLINES INTENTIONALLY LEFT BLANK
Slide 26: Financial Strategy and Capital Policy 1
《Reference》 Financial Strategy and Capital Policy① ※Originally disclosed on February 28, 2018 15
Slide 27: Financial Strategy and Capital Policy 2
《Reference》 Financial Strategy and Capital Policy② ※Originally disclosed on February 28, 2018 *1 Free cash flow (3-year aggregate)=Cash flow from operating activities-Cash flow from investing activities *3 Indicates dividend yield of shareholders’ equity *2 3-year aggregate new debts used (new procu
Slide 28: Financial Strategy and Capital Policy 3
《Reference》 Financial Strategy and Capital Policy③ ※Originally disclosed on February 28, 2018 17
Slide 29: Innovation of Passenger Service System
《Reference》 Innovation of Passenger Service System ※Originally disclosed on February 28, 2018 18
Slide 30: ESG: Environmental, Social, Governance
ESG ※Originally disclosed on April 27, 2018 ※Updated 2017 CO2 emissions data Environmental Social Governance Low-Carbon Initiatives ： ・High transparency and strict Introduce fuel-efficient aircraft and ・Further promote workstyle innovation: management oversight： aim for eco-friendly operation Reduce
Slide 31: Fly into tomorrow.
Fly into tomorrow. Finance & Investor Relations, Japan Airlines
Slide 32: 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