Japan Airlines Co., Ltd. · TSE:9201
Japan Airlines — Q1 FY2019 Earnings Presentation
33 slides from Japan Airlines's earnings presentation, Jul 31, 2019
Slide 1: Financial Results 1st Quarter Mar/2020 (FY2019)
JAPAN AIRLINES Co., Ltd. Financial Results 1st Quarter Mar/2020（FY2019） July 31, 2019
Slide 2: Today's Topics
Today’s Topics P.1 P.2 REFERENCES P.14 SKYTRAX FlightStats SKYTRAX 5-Star Airline The best on-time The World’s Best Economy Class Asia-Pacific Airline The Best Economy Class Seat (Note) Regarding figures in tables of this material, amounts are rounded down to the nearest hundred million yen, and the
Slide 3: Overview of Financial Results for 1st Quarter Mar/20
Overview of Financial Results for 1st Quarter Mar/20 Operating Revenue increased by capturing demand steadily. Without the depreciation method change, Operating Profit was at the same level year-on-year Operating Revenue Operating profit・Net profit (1)・Operating profit margin Figures in ( ) exclud
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, 2020. In this Quarter, due to the world economy slow down, International Passenger and Cardo demand was not strong, but we steadily captured strong Domestic demand. As a result, Operating
Slide 5: Consolidated Financial Results for 1st Quarter Mar/20
Consolidated Financial Results for 1st Quarter Mar/20 1st Quarter 1st Quarter （JPY Bn） Mar/19 Mar/20 Diff. y/y Operating Revenue 342.1 355.7 +13.6 +4.0% International Passenger 124.8 127.8 ＋3.0 +2.4% Domestic Passenger 117.2 123.9 +6.6 +5.7% Cargo / Mail 24.2 22.7 ▲1.4 ▲6.1% Other 75.7 81.1 ＋5.3 +7.
Slide 6: Consolidated financial results (commentary)
Now, I will explain our consolidated financial results. The figures in brackets do not include the depreciation method change. From this fiscal year, a depreciation method for aircraft components such as aircraft parts has been changed. Then, Depreciation Cost increases, but at the same time, No
Slide 7: Changes in Operating Profit (Revenues/Expenses)
Changes in Operating Profit(Revenues/Expenses ） 1st Quarter Mar/20 （ JPY Bn ） ＋ stands for profit increase (revenue increase, cost decrease) ▲ stands for profit decrease (revenue decrease, cost increase) ▲3.8 Bn ASK y/y ： +2.0% (▲15.6%) RPK y/y ： +2.9% ▲0.5Bn (▲2.1%) Other Revenues Fuel Maintenance
Slide 8: Changes in Operating Profit (commentary)
Now, I will explain about the changes in Operating Profit. Operating Revenue increased by 13.6 billion yen year-on-year. For Expenses, Fuel Cost increased year-on-year. Some expenses including Personnel are rising as we are preparing for capacity expansion next year. For Maintenance Cost, it i
Slide 9: Changes in Operating Profit (Market/Others)
Changes in Operating Profit（ Market/Others ） 1st Quarter Mar/20 （ JPY Bn ） ＋ stands for profit increase (revenue increase, cost decrease) ▲ stands for profit decrease (revenue decrease, cost increase) Impact from Currency Market ▲2.1Bn ▲3.8 Bn Revenue ▲0.0Bn Cost ▲2.1Bn (▲15.6%) Fuel ▲1.4Bn ▲0.5Bn E
Slide 10: Operating Profit changes by market impact (commentary)
This page explains changes in Operating Profit from the viewpoints of market impact and others. 4-S
Slide 11: International Passenger Operations
International Passenger Operations International Passenger Change in Revenue （ JPY Bn ） 1st Quarter 1st Quarter ＋3.0 ＋30億円Bn y/y Mar/19 Mar/20 (＋2.4%) Including the Passenger Revenue 124.8 127.8 +2.4% Passenger Service (JPY Bn) System Effects +0.5 127.8 Passengers (’000) 2,251 2,262 +0.5% 124.8 ＋2.5
Slide 12: International passenger operations (commentary)
For International routes, we increased capacity by introducing a new route and cabin configuration change, however, the number of passenger increased just by 0.5% year-on-year because overseas demand was not strong enough. Revenue per Passenger increased by 1.9% year-on-year. Details are shown i
Slide 13: Domestic Passenger Operations
Domestic Passenger Operations Domestic Passenger Change in Revenue 1st Quarter 1st Quarter （ JPY Bn ） y/y Mar/19 Mar/20 ＋6.6 Bn Passenger Revenue (＋5.7%) 117.2 123.9 +5.7% (JPY Bn) ・ Demand Rise during Passengers 8,297 8,654 +4.3% the long holidays(＋) (’000) ・ Increase in individual Including the pa
Slide 14: Domestic passenger operations (commentary)
Next, for domestic routes. The number of passenger leaped 4.3% led by rising individual passenger demand especially during the long holidays. Load factor also improved to the record high of 71.9% as a first quarter. Revenue per Passenger increased 1.3% year-on-year. Not only during the long ho
Slide 15: Major Operating Expense Items
Major Operating Expense Items Operating Expenses 1st Quarter 1st Quarter (JPY Bn) Diff. y/y Mar/19 Mar/20 Fuel 60.3 63.6 +3.2 +5.5% Landing and navigation fees 21.2 21.4 +0.1 +0.6% Maintenance 18.5 19.2 +0.6 +3.6% Sales commissions (Air Transport) 4.7 4.6 ▲0.0 ▲2.0% 31.5 +4.0 +14.7% Aircraft (1) (2)
Slide 16: Major operating expense items (commentary)
Now, I will explain the major operating expense items, which totaled to 331.3 billion yen, up 4.5% year-on-year, when the depreciation method change is excluded. All expenses are within our plan except Maintenance, which has just a time-lag issue. It will also be within our plan eventually. 7-S
Slide 17: Impact of Fuel and FX Markets
Impact of Fuel and FX Markets Hedge Ratio Fuel Cost Breakdown by Factors (As of End of Jun/2019) （ JPY Bn ） Volume 100% 70 increase/ Fuel FX Hedging Market FX +2.5 63.6 80% 60.3 ▲0.6 +1.4 60 60% Approx. Approx. 40% 40% ＋3.2Bn 40% 50 (＋5.5%) Approx. Approx. 15% 15% 20% Approx. Approx. 5% 5% 40 1st Qu
Slide 18: Fuel and FX impact (commentary)
Fuel Cost increased by 3.2 billion yen to 63.6 billion yen because of FX and hedging. The right bottom chart shows the impact on the profit of the second quarter or later. The fuel surcharge for August and September has already been fixed. With July and August Fuel Cost forecast, those profit im
Slide 19: Major Balance Sheet Items and Cash Flow Items
Major Balance Sheet Items and Cash Flow Items Balance Sheet End of 1st Quarter （JPY Bn） End of Mar/19 Diff. Mar/20 Total Assets 2,030.3 2,016.8 ▲13.5 Cash and Deposits (1) 522.0 491.7 ▲30.3 Balance of Interest-bearing Debt (2) 142.3 142.0 ▲0.3 Future Rental Expenses under Operating Leases 81.1 77.1
Slide 20: Balance sheet and cash flow (commentary)
Page 9 indicates our balance sheet and our cash flows. For buyback, we have completed to acquire 2.17 million shares, equivalent to 7.6 billion yen. We will continue to acquire shares up to 20 billion yen in total by the end of September. 9-S
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/19 1Q Mar/20 y/y (%) 1Q Mar/20 1Q Mar/19 1Q Mar/20 America 330 368 +11.2% America +16.4% 26% 30% Europe 182 185 +1.6% Europe ▲2.7% 17% 16% Asia/Oceania 1
Slide 22: International routes by geographic segment (commentary)
Please let me explain about International Routes by Geographic Segment. For the Hawaiian routes, where our competitor is increasing its capacity, we have decreased our capacity for solid operation. As a result, load factor did not fall, and Passenger Number and Revenue per Passenger are within o
Slide 23: Number of Aircraft
《 Reference 》 Number of Aircraft End of Mar/19 End of 1st Quarter Mar/20 (March 31, 2019) (June 30, 2019) Diff. Owned Leased Total Owned Leased Total Airbus A350-900 0 0 0 1 0 1 +1 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 24: FY2019 Earnings Forecast
《 Reference 》 FY2019 Earnings Forecast ※No change from the figures disclosed on April 26, 2019 Revenue and FY2019 Operational FY2019 Preconditions ※y/y FY2018 Expenditure Plan FY2018 Diff. y/y (Plan) (Plan) (JPY Bn) ASK Int’l +6.0％ +2.5% Operating Revenue 1,487.2 1,563.0 +75.7 +5.1% Doms +1.1% +2.6%
Slide 25: FY2019 Earnings Forecast
《 Reference 》 FY2019 Earnings Forecast ※No change from the figures disclosed on April 26, 2019 Balance Sheet End of End of (1) NOPAT/Average Fixed Asset (incl. Future Rental Expenses under （JPY Bn） FY2019 Diff. FY2018 Operating Leases) at beginning and end of a fiscal year (Plan) (2) Figures in ( )
Slide 26: References
OVERVIEW OF FINANCIAL RESULTS FOR 1ST QUARTER MAR/20 DETAILS OF FINANCIAL RESULTS FOR 1ST QUARTER MAR/20 REFERENCES 14
Slide 27: ESG
《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 28: 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 29: 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 30: Financial Strategy and Capital Policy ③
《Reference》 Financial Strategy and Capital policy③ ※Originally disclosed on February 25,2019 （Partial update ） Stable financial structure with high capital efficiency Enhancement of shareholder return and capital allocation for corporate value increases Financial structure Capital efficiency Shareho
Slide 31: Financial Strategy and Capital Policy ④
《Reference》 Financial Strategy and Capital policy④ ※Originally disclosed on April 26,2019 Shareholder Return Policy Focuses on continuity, stability and predictability (1) Total Return Ratio＝ From FY2019, approximately 35% will be a benchmark Dividends for payout ratio Total dividends + Total sh
Slide 32: Fly into tomorrow.
Fly into tomorrow. Finance & Investor Relations, Japan Airlines ©Japan Airlines, ALL rights reserved.
Slide 33: 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