Financial Results for Third Quarter of the Fiscal Year Ended March 2026 (FY2025)
Respondents:
February 6, 2026(Fri)
17:00－17:30
Managing Director and Executive Officer: Takeshi Kiriyama
Executive Officer, Finance & Accounting / IR: Kaoru Tagami
Please be advised that the following text has been edited/modified from the original Q&A conversations for clarity.
A. In Q3, we appropriately recorded the provision for future maintenance plans that was originally expected in Q4, in accordance with accounting standards. The recorded amount is in line with initial expectations and will have no impact on the full-year earnings forecast. We aim to achieve its full-year operating income forecast of JPY1.6 billion by adding the approximately JPY1.0 billion in gain on reversal of maintenance provisions planned for Q4 to the JPY0.4 billion in operating income for Q1-Q3, and by further reducing management-controllable costs and building up revenue.
Q2. Which expense categories performed better than the target? Please also describe the specific cost reductions achieved.A. We have made continuous efforts to contain management-controllable costs, specifically by in-housing some processes that were planned to be outsourced, such as airport-related operations. As a result, we have achieved cost reductions under Other Expenses of
approximately 10% to 15% compared to the initial target, supporting our profit levels.
Q3. You mentioned that the introduction of new aircraft is expected to begin in earnest from the next fiscal year. How will this affect your financial results?A. Beginning in FY2026, we will introduce new aircraft, retiring current aircraft sequentially. While the new aircraft are more fuel-efficient and will help reduce fuel costs, aircraft lease payments are on an upward trend due to recent inflation and other factors. We will closely monitor the balance between the reduction in fuel costs and increasing aircraft lease payments, and flexibly determine the optimal fleet composition depending on the situation.
Q4. If other domestic airlines introduce a fuel surcharge on domestic routes, will your system be able to handle it?A. Our system would need to be modified to handle a newly-introduced fuel surcharge, and we expect a full-scale modification to take at least one year. However, even before the
system is updated, we believe it is possible to tentatively establish a mechanism to collect a surcharge equivalent in real terms, including by devising display methods. We will make preparations to respond flexibly in light of trends at other companies and the market environment.
Q5. What is your view on the progress of the Committee for the Review of the Future of Domestic Aviation organized by the Ministry of Land, Infrastructure, Transport and Tourism (MLIT) in terms of expectations and effectiveness?A. Last year, we made a presentation at this committee with the aim of overcoming the current stiff competitive environment. We have very high expectations for the final report scheduled for May. It is our sincere hope that the involved experts will come to a conclusion that will provide us a tailwind, especially with regard to addressing rising fuel prices and developing a fair competitive environment.