Japan Airlines Co., Ltd. · TSE:9201

Japan Airlines — FY2012 Earnings Presentation

38 slides from Japan Airlines's earnings presentation, Apr 30, 2013

  1. Slide 1: Mar/2013 (FY2012) Results

    Mar/2013 (FY2012) Results Yoshiharu Ueki, President 30 April, 2013

  2. Slide 2: Topics

    Topics Overview of Mar/2013 (FY2012) Results and P.1 1 Dividend Policy Overview of Medium Term Management Plan P.5 2 2012-2016 Rolling Plan 2013 3 Details of Mar/2013 (FY2012) Result P.15 4 Earnings Forecast for Mar/2014 (FY2013) P.27 Supplemental References P.33 1

  3. Slide 3: Overview of Full-Year Mar/2013 (FY2012) Results

    Overview of Full-Year Mar/2013 (FY2012) Results  Operating Profit for Mar/2013 (FY2012) is 195.2Bn JPY (y/y ▲4.7%)  Equity ratio reached 46.4% (y/y +10.7pt) Operating Revenue Operating Profit （JPY Bn） （JPY Bn) Operating Profit Margin 204.9 1,238.8 200 195.2 20% 1,204.8 180 17.0% 15% 1,200 15.8% 16

  4. Slide 4: Dividend Policy

    Dividend Policy  Board declares cash dividend of 190.00 JPY per share for Mar/2013, increased by 10 JPY from our previous forecast.  We will keep the dividend payout ratio of 20% of our Net Income for FY2013. Previously announced dividend per share 180.00 JPY 190.00 JPY per share Per share Increas

  5. Slide 5: Operations of Boeing 787

    Operations of Boeing 787 New Launch Date  Grounded all Boeing 787s Route Flight # Aircraft Date of Launch Weekly Flights from 16 Jan (total 7 aircraft) Narita=Helsinki JL413/414 787-8 01 Jul, 2013 7  Operations of Boeing 787 will Other 787 Operating Routes be resumed from June 1, 2013. Current Wee

  6. Slide 6: Topics

    Topics Overview of Mar/2013 (FY2012) Results and P.1 1 Dividend Policy Overview of Medium Term Management Plan P.5 2 2012-2016 Rolling Plan 2013 3 Details of Mar/2013 (FY2012) Result P.15 4 Earnings Forecast for Mar/2014 (FY2013) P.27 Supplemental References P.33 5

  7. Slide 7: Medium Term Management Plan – Overview of Rolling Plan 2013

    Medium Term Management Plan – Overview of Rolling Plan 2013 Surviving Future Competition ●Enhancement of JAL Brand ●Route Network, Products and Services ●Cost Competitiveness We will maintain safety and provide We will build a highly convenient route We will continuously strive to customers with unp

  8. Slide 8: Medium Term Management Plan – Enhancement of JAL Brand

    Medium Term Management Plan – Enhancement of JAL Brand International – High Quality and Full-Service Domestic – Convenience and Simplicity  Completed to install  Introduced new seats in all classes - First Class on all 777-200s (JAL SKY SUITE 777) - Class J on all 737-800s First Class New York ser

  9. Slide 9: Medium Term Management Plan – Route Network

    Medium Term Management Plan – Route Network International Domestic  Launched Narita=Boston and Narita=San Diego  Launched (resumed): Fukuoka=Hanamaki, Niigata=Sapporo Osaka/Itami=Matsuyama, Hakodate, Misawa  Launched: Haneda=Nagoya/Chubu  Increased frequency: Osaka/Itami routes  Increased frequ

  10. Slide 10: Medium Term Management Plan – Route and Network

    Medium Term Management Plan – Route and Network Alliance Strategy  Launched Joint Business with British Airways  Marked good performance in Joint Business with American Airlines  Collaborate with our partners to maximize business partnerships for the sake of greater convenience and efficiency, ex

  11. Slide 11: Medium Term Management Plan – Cost Competitiveness

    Medium Term Management Plan – Cost Competitiveness Unit Cost (JPY) FY2012 FY2013 FY2016 Total Cost (Before Expansion) 11.5 11.3 11.0 Original Medium Term Total Cost (After Expansion) - 11.4 11.1 Management Plan Excluding Fuel Cost - 8.3 8.0 Result / Plan / Total Cost (After Expansion) (*1) 11.5 12.0

  12. Slide 12: Medium Term Management Plan – Cost Competitiveness

    Medium Term Management Plan – Cost Competitiveness Divisional Profitability Management System Productivity per Person ASK / Number of Staff  Introducing group companies (Thousand Seat km / Staff) <Result> Introduced 9 companies in FY2012 (Planned: 8 companies) 2,700 <Plan> Adding 9 new companies in

  13. Slide 13: Medium Term Management Plan – Productivity Improvement

    Medium Term Management Plan – Productivity Improvement Review for the Productivity Improvement and Future Action  Streamline back office  Improve utilization of flight and cabin crew  Efficient staff allocation measures at airport and maintenance divisions - Continue activities to improve product

  14. Slide 14: Mid-Term Management Plan – Aircraft investment

    Mid-Term Management Plan – Aircraft investment Investment Amount in Aircraft Change of # of aircraft (JPY Bn) # of aircraft 140 250 Large Original Plan 216 220 218 222 222 120 Result and New Plan 200 100 Medium 150 80 100 Small 60 40 50 RJ 20 0 2012 2013 2014 2015 2016 0 * End of Fiscal Year 2012 20

  15. Slide 15: Mar/2013 (FY2012) Results

    Mar/2013 (FY2012) Results [Details] Norikazu Saito, Executive Director

  16. Slide 16: Topics

    Topics Overview of Mar/2013 (FY2012) Results and 1 2013年3月期業績サマリー 及び 株主還元 P.1 Dividend Policy Overview of Mid-Term Management Plan P.5 2 2012-2016 - Rolling Plan 2013 3 Details of Mar/2013 (FY2012) Result P.15 4 Earnings Forecast for Mar/2014 (FY2013) P.27 Supplemental References P.33 15

  17. Slide 17: Overview of Consolidated Financial Results

    Overview of Consolidated Financial Results  Revenue of JPY 1,238.8 Bn JPY and Operating Profit of JPY 195.2 Bn JPY  Operating Profit Margin of 15.8% 4Q (Jan-Mar) (JPY Bn) Mar/2012 Mar/2013 % y/y % y/y Mar/2013(4) Revenue 1,204.8 1,238.8 +2.8% 296.7 +0.4% Air Transportation Segment 1,081.1 1,106.1

  18. Slide 18: Changes of Operating Profit

    Changes of Operating Profit Mar/2013 (FY2012) ASK y/y: +3.3% RPK y/y: +8.5% Progress of cost improvement (JPY Bn) (JPY Bn) Minimized costs by expanding the Other Divisional Profitability Management Domestic Int’l Revenue Fuel System Passenger Cargo Operation Minimized costs by improving +4.2% ▲5.8%

  19. Slide 19: International Passenger Operations (Operating Results)

    International Passenger Operations (Operating Results) 4Q (Jan-Mar) International Passenger Mar/2012 Mar/2013 % y/y % y/y Mar/2013 Passenger Revenue (JPY Bn) 385.2 406.6 +5.5% 98.3 +2.1% ASK (MN seat km) 43,036 44,745 +4.0% 11,357 +3.5% RPK (MN passenger km) 30,313 34,036 +12.3% 8,605 +4.4% Passenge

  20. Slide 20: International Passenger Operations (Changes of Revenue)

    International Passenger Operations (Changes of Revenue)  As the aggregate number of passengers increased, passenger revenue rose by JPY 21.3Bn y/y at Mar/2013. Mar/2013 (FY2012) +JPY21.3Bn  Strong Demand on mid-long (+5.5%) haul routes; Europe, North 406.6 America, Southeast Asia <L/F> This Year (

  21. Slide 21: Domestic Passenger Operations (Operating Results)

    Domestic Passenger Operations (Operating Results) 4Q (Jan-Mar) Domestic Passenger Mar/2012 Mar/2013 % y/y % y/y Mar/2013 Passenger Revenue (JPY Bn) 481.1 485.2 +0.9% 111.7 ▲1.8% ASK (MN seat km) 35,523 36,443 +2.6% 8,756 ▲3.2% RPK (MN passenger km) 22,264 23,012 +3.4% 5,433 ▲1.5% Passengers (’000) 2

  22. Slide 22: Domestic Passenger Operations (Changes of Revenue)

    Domestic Passenger Operations (Changes of Revenue)  Revenue increased by JPY 4.1 Bn Mar/2013 (FY2012)  Increased flights offering First Class service +JPY4.1Bn (+0.9%)  Expanded First Class Service 485.2 to Haneda = Okinawa  Increased Class J seats 481.1  Resumed: +16.5 Fukuoka = Hanamaki, ▲12.

  23. Slide 23: Major Operating Expense Items

    Major Operating Expense Items Breakdown of Operating Expenses 4Q (Jan-Mar) （JPY Bn） Mar/2012 Mar/2013 % y/y % y/y Mar/2013(1) Fuel 232.9 246.3 +5.8% 60.7 +0.5% Landing fees and other rent 71.6 75.1 +4.8% 18.5 +1.7% Maintenance 23.5 30.4 +29.3% 6.7 +29.9% Sales Commissions (Air Transport) 22.3 20.3 ▲

  24. Slide 24: Major Balance Sheet Items

    Major Balance Sheet Items  The balance of interest-bearing debt is JPY 160.1Bn after repayment  Shareholders' equity ratio increased by 10.7pt to 46.4%. End of FY2011 End of FY2012 (JPY Bn) Difference 2012/3/31 2013/3/31 Total Assets 1,087.6 1,216.6 +128.9 Cash and Deposits 272.4 347.9 +75.5 Balan

  25. Slide 25: Major Cash Flow Items

    Major Cash Flow Items End of FY2011 End of FY2012 (JPY Bn) Difference 2012/3/31 2013/3/31 Net income before income taxes and 199.9 190.4 ▲9.4 minority interests Depreciation 81.2 81.0 ▲ 0.2 Other ▲24.4 ▲6.6 17.8 Cash Flow from Operating Activities 256.6 264.8 8.1 Capital Expenditure (1) ▲98.6 ▲121.8

  26. Slide 26: Supplemental Reference

    《Supplemental Reference》 Revenue of International Routes by Geographic segment Passenger Revenue (% of the whole int’l revenue) Passengers 4Q (‘000) FY2011 FY2012 y/y 4Q FY2012 y/y (%) FY2011 FY2012 y/y y/y FY2012 Trans Pacific 32.0% 34.0% +2.0pt 33.0% +1.5pt Trans Pacific 1,555 1,692 +8.8% 420 +2.4

  27. Slide 27: Supplemental Reference: Number of Aircraft in Service

    《Supplemental Reference》 Number of Aircraft in Service Number of Aircraft (Consolidated) End of Mar/2012 End of Mar/2013 2012/3/31 2013/3/31 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 777-30

  28. Slide 28: Topics

    Topics Overview of Mar/2013 (FY2012) Results and P.1 1 Dividend Policy Overview of Mid-Term Management Plan P.5 2 2012-2016 - Rolling Plan 2013 3 Details of Mar/2013 (FY2012) Result P.15 4 Earnings Forecast for Mar/2014 (FY2013) P.27 Supplemental References P.33 27

  29. Slide 29: Earnings Forecast for Mar/2014 (FY2013, Consolidated)

    Click toForecast Earnings edit Master title style(FY2013,Consolidated) for Mar/2014 FY2012 Result FY2013 Forecast (JPY Bn) Difference (Mar/2013) (Mar/2014) Revenue 1,238.8 1,272.0 +33.1 Operating Expense 1,043.5 1,132.0 +88.4 Operating Profit 195.2 140.0 ▲55.2 Ordinary Income 185.8 127.0 ▲58.8 Net I

  30. Slide 30: Mar/2014 Operating Forecast (Air Transport Business)

    Mar/2014 Operating Forecast (Air Transport Business) International Domestic Passenger Passenger (*y/y %) Mar/2014 Mar/2014 [Forecast] [Forecast] ASK(*) +3.9% +4.5% RPK (*) +4.5% +1.5% Revenue Passengers Carried(*) +3.3% +1.8% L/F (%) 76.6% 61.4% Unit revenue (1)(*) +0.9% ▲3.0% Yield (2)(*) +0.2% ▲0.

  31. Slide 31: Increased/Decreased Factors of Operating Profit

    Increased/Decreased Factors of Operating Profit Mar/2013 (FY2012) to Mar/2014 (FY2013) （JPY Bn) 230 Revenue+33.1Bn Expenses+88.4Bn +7.8 220 +6.7 ▲17.3 • Increase in sales of products ▲0.8 210 • FX assumption 95JPY/USD etc. +19.3 ▲11.1 200 195.2 • Landing Fees • Recruitment etc 190 • Fuel consumption

  32. Slide 32: Impact of Fuel and Currency Markets

    Impact of Fuel and Currency Markets Hedging Ratio for Fuel Costs (As of End of Mar/2013) 100% 80% 80% Fuel FX 60% 40% 40% 20% 10% 10% 5% 5% 0% FY2013 FY2014 FY2015 Result and Assumptions Sensitivity for Fuel Costs (Without Hedge) FY2012 Result FY2013 Plan Crude Oil 2.0 Bn Yen Singapore Kerosene (USD

  33. Slide 33: Mar/2014 Earnings Forecast (Consolidated Balance Sheet / Cash Flow)

    Mar/2014 Earnings Forecast (Consolidated Balance Sheet / Cash Flow) Consolidated Balance Sheet Mar/2013 Mar/2014 (JPY Bn) Difference Result Forecast Total Assets 1,216.6 1,273.0 +56.3 Interest-bearing Debt 160.1 129.0 ▲31.1 Shareholders' Equity 565.0 644.0 +78.9 Shareholders' Equity Ratio (%) 46.4%

  34. Slide 34: Supplemental References

    Overview of Mar/2013 (FY2012) Results and P.1 1 Dividend Policy Overview of Mid-Term Management Plan P.5 2 2012-2016 - Rolling Plan 2013 3 Details of Mar/2013 (FY2012) Result P.15 4 Earnings Forecast for Mar/2014 (FY2013) P.27 Supplemental References P.33 33

  35. Slide 35: Registration of Foreigners, etc. in Our Shareholders' List

    Registration of Foreigners, etc. in Our Shareholders’ List Shareholder Structure at the end of March 2013 Shareholding Ratio(1) Foreigners, etc. (approx. 37.34%) Refused registration in our shareholders’ list pursuant to our Articles of Incorporation Voting Right(1) Foreigners, etc. (approx. 31.32%)

  36. Slide 36: Payment of Dividend to Foreigners, etc.

    Payment of Dividend to Foreigners, etc.  Considering our key policy to return proactively profits to our shareholders, we have determined that we will proceed with the preparations for making appropriate adjustments to our Articles of Incorporation.  We will submit the proposal for changing our Ar

  37. Slide 37: Fly into tomorrow.

    Fly into tomorrow. Contact: Finance, Japan Airlines +81-3-5460-3068

  38. Slide 38: Forward-looking statements notice

    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

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