Japan Airlines Co., Ltd. · TSE:9201

Japan Airlines — Q2 FY3/2013 Earnings Presentation

28 slides from Japan Airlines's earnings presentation, October 2012

  1. Slide 1: Japan Airlines Financial Results Second Quarter FY3/2013 (FY2012)

    Japan Airlines Financial Results Second Quarter FY3/2013 (FY2012)

  2. Slide 2: Table of Contents

    Table of Contents Overview of 2Q FY3/13 (2Q FY12) Financial FY3/13 (FY12) Earnings & Operating Forecast Results • Consolidated Results P.18 • Highlights of 2Q FY3/13 Financial Results P.3 • Change of Consolidated Operating Profit Forecast P.19 • Revision of Consolidated Financial Forecast for P.4 •

  3. Slide 3: Overview of 2Q FY3/13 (2Q FY12) Financial Results

    Overview of 2Q FY3/13 (2Q FY12) Financial Results

  4. Slide 4: Highlights of 2Q FY3/13 Financial Results

    Highlights of 2Q FY3/13 Financial Results  Revenue for 1H FY3/13 is JPY 112.1Bn (Y/Y +5.7%), operating margin continues to be high  Has been strengthened financial position and equity ratio reached to 41.7% Total Revenue Operating Profit (JPY Bn) (JPY Bn) Margin 800 150 17.7% 17.7% 20% 599.8 634.2

  5. Slide 5: Revision of Consolidated Financial Forecast for FY3/13

    Revision of Consolidated Financial Forecast for FY3/13 Upward Revision of Operating Profit (JPY Bn) Margin +JPY15.0Bn 13.6％ Margin (＋10.0%) 12.3％ +JPY12.0Bn Margin (＋8.7%) 11.3％ 165 150 138 Target in Mid-Term Old Forecast New Forecast Plan 4

  6. Slide 6: Progress in Mid-Term Management Plan

    Progress in Mid-Term Management Plan Route Network New Products and Services  Narita-Boston route by Boeing 787 marked a good takeoff  “Welcome! JAL New Sky”  L/F of Narita-Boston route: 83.6% Introduction of new seat designs in every (L/F of International Passenger Transportation: 76.2%) cabin c

  7. Slide 7: Cost Improvement

    Cost Improvement  Improving cost efficiency to achieve the unit cost (1) of JPY 11.0 in FY3/17 as targeted in the mid-term management plan  Unit cost of 2Q is JPY 11.5, and expected to achieve unit cost target for FY3/13, JPY 11.5  Achieved cost reduction of JPY 5 Bn at 2Q FY3/13 (expected to min

  8. Slide 8: Details of 2Q FY3/13 (2Q FY12) Financial Results

    Details of 2Q FY3/13 (2Q FY12) Financial Results

  9. Slide 9: Overview of Consolidated Financial Results

    Overview of Consolidated Financial Results  Revenue JPY 634.2Bn and operating profit JPY 112.1Bn  Operating profit margin 17.7%, the same level as last year (JPY Bn) 1H FY3/12 1H FY3/13 % Y/Y 2Q FY3/13 (1) % Y/Y Revenue 599.8 634.2 +5.7% 347.4 +0.7% Air Transportation Segment 539.4 567.7 +5.2% 310

  10. Slide 10: Increase / Decrease Element of Operating Profit

    Increase / Decrease Element of Operating Profit 1H FY3/2013 (JPY Bn) Other • Cost for new products and services Fuel • Depreciation ASK Y/Y：+5.9% Revenues （Shorten the years of aircraft RPK Y/Y：+13.1% +6.9% ▲9.0% depreciation） Domestic International Operation • Personnel (Bonus Payment) etc. Passeng

  11. Slide 11: International Passenger Operations (Operating Results)

    International Passenger Operations (Operating Results) International Passenger 1H FY3/12 1H FY3/13 % Y/Y 2Q FY3/13 % Y/Y Passenger Revenue (JPY Bn) 190.8 210.3 +10.2% 114.3 +2.2% Passengers (’000) 3,210 3,778 +17.7% 1,975 +6.9% RPK (MM passengers-km) 14,391 16,852 +17.1% 8,890 +8.8% ASK (MM seats-km

  12. Slide 12: International Passenger Operations (Increase / Decrease Element of Passenger Revenue)

    International Passenger Operations (Increase / Decrease Element of Passenger Revenue)  As the number of passengers increases, passenger revenue rose by JPY 19.4Bn Y/Y at 1H FY3/13 1H FY3/2013 (JPY Bn) +JPY 19.4Bn (+10.2%) 210.3 190.8 +30.5 ▲11.0 Revenue per Passenger Number of Passengers ・Demand re

  13. Slide 13: Domestic Passenger Operations (Operating Results)

    Domestic Passenger Operations (Operating Results) Domestic Passenger 1H FY3/12 1H FY3/13 % Y/Y 2Q FY3/13 % Y/Y Passenger Revenue (JPY Bn) 243.3 250.4 +2.9% 142.1 ▲0.5% Passengers (’000) 14,175 15,226 +7.4% 8,114 +1.3% RPK (MM passengers-km) 10,853 11,689 +7.7% 6,264 +0.1% ASK (MM seats-km) 17,352 18

  14. Slide 14: Domestic Passenger Operations (Increase / Decrease Element of Passenger Revenue)

    Domestic Passenger Operations (Increase / Decrease Element of Passenger Revenue)  Revenue increases by JPY 7.0Bn due to increase in the number of passengers 1H FY3/2013 (JPY Bn) +JPY 7.0Bn (+2.9%) 250.4 243.3 +16.5 ▲9.5 Revenue per Passenger Number of Passengers • Demand recovery from Earthquake 1H

  15. Slide 15: Major Operating Expense Items

    Major Operating Expense Items Breakdown of Operating Expense (JPY Bn) 1H FY3/12 1H FY3/13 % Y/Y 2Q FY3/13 (1) % Y/Y Fuel 113.8 124.1 +9.0% 62.4 +3.2% Landing fees and other rent 35.1 37.9 +8.0% 19.3 +5.4% Maintenance 11.2 14.8 +31.6% 7.9 +49.4% Sales Commissions 10.9 10.2 ▲7.2% 5.1 ▲9.7% Aircraft De

  16. Slide 16: Major Balance Sheet Items

    Major Balance Sheet Items  The balance of interest-bearing debt is JPY 182.4Bn after repayment  Shareholders' equity ratio increases by 6.0pt to 41.7%. End of FY3/12 End of 2Q FY3/13 (JPY Bn) Difference 2012/3/31 2012/9/30 Total Assets 1,087.6 1,147.3 +59.7 Cash and Deposits 272.4 349.0 +76.5 Bala

  17. Slide 17: Major Cash Flow Items

    Major Cash Flow Items (JPY Bn) 1H FY3/12 1H FY3/13 Difference Net income before income taxes and 109.0 110.6 +1.6 minority interests Depreciation 41.5 40.7 ▲0.7 Interest Payment ▲6.8 ▲1.6 +5.1 Tax ▲4.4 ▲12.1 ▲ 7.6 Other ▲17.1 15.4 +32.5 Cash Flow from Operating Activities 122.1 152.9 +30.8 Capital E

  18. Slide 18: FY3/13 (2Q FY12) Earnings & Operating Forecast

    Click to edit Master title style FY3/13 (2Q FY12) Earnings & Operating Forecast

  19. Slide 19: FY3/13 Earnings Forecast (Consolidated Results)

    FY3/13 Earnings Forecast (Consolidated Results) (JPY Bn) FY3/12 Actual FY3/13 New Forecast FY3/13 Old Forecast Difference Revenue 1,204.8 1,215.0 1,220.0 ▲5.0 Operating Expense 999.8 1,050.0 1,070.0 ▲20.0 Operating Profit 204.9 165.0 150.0 +15.0 Ordinary Income 197.6 155.0 140.0 +15.0 Net Income 186

  20. Slide 20: Change of Consolidated Operating Profit Forecast

    Change of Consolidated Operating Profit Forecast  Operating Profit improved by JPY 15Bn from the previous announcement → Upward adjustment from JPY 150Bn to JPY 165Bn  Revenue decreased by JPY 5Bn and fuel cost increased by JPY 5Bn but other expense is expected to decrease by JPY 25Bn • Productivi

  21. Slide 21: FY3/13 Earnings Forecast (Consolidated Balance Sheets / Cash Flow)

    FY3/13 Earnings Forecast (Consolidated Balance Sheets / Cash Flow) Consolidated Balance Sheet (JPY Bn) End of FY3/12 Actual FY3/13 New Forecast Difference Total Assets 1,087.6 1,174.0 +86.3 Interest-bearing Debt 208.4 175.0 ▲33.4 Shareholders' Equity 388.5 521.0 +132.4 Shareholders' Equity Ratio (%)

  22. Slide 22: Supplemental Reference

    nn Cc) JAPAN AIRLINES Supplemental Reference

  23. Slide 23: Revenue of International Routes by Geographic Segment

    《Supplemental Reference》 Revenue of International Routes by Geographic Segment Passenger Revenue (% of the whole int’l routes) Passengers (%) 1H FY3/12 1H FY3/13 Y/Y 2Q FY3/13 Y/Y (’000) 1H FY3/12 1H FY3/13 Y/Y 2Q FY3/13 Y/Y Pacific Routes 33.0% 34.0% +1.0pt 35.5% +2.5pt Pacific Routes 7,552 8,436 +

  24. Slide 24: FY3/13 Operating Forecast (Air Transportation Business)

    《Supplemental Reference》 FY3/13 Operating Forecast (Air Transportation Business) International Passenger Domestic Passenger 1H FY3/13 2H FY3/13 FY3/13 1H FY3/13 2H FY3/13 FY3/13 (Y/Y basis) Actual Forecast Forecast Actual Forecast Forecast ASK +4.5% +6.9% +5.7% +7.6% ▲0.9% +3.3% RPK +17.1% +1.9% +9.

  25. Slide 25: Number of Aircraft in Service

    《Supplemental Reference》 Number of Aircraft in Service Number of Aircraft Used by the JAL Group End of FY3/12 End of 2Q FY3/13 2012/3/31 2012/9/30 Increase/ Decrease 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

  26. Slide 26: New Routes and Planned Service

    《Supplemental Reference》 New Routes and Planned Service International Routes Domestic Routes 【New routes】 【Increase of Service】 Route Craft Flight Change (RT) Timing Route Flight Change (RT) Timing 0 ⇒4 (per week) December 2, 2012－ Narita = San Diego 787-8 Haneda = Izumo 5⇒6 per day October 28, 2012

  27. Slide 27: Contact

    Contact Thank you for your attention! For any inquiries regarding this presentation, please contact the following Japan Airlines Financing and Accounting Office Finance Department Phone： 81-3-5460-3068

  28. Slide 28: Important Information Regarding the Presentation

    Important Information Regarding the Presentation 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

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