Japan Airlines Reports $92.5M Loss in 3Q

TOKYO – Soaring fuel costs sent Japan Airlines deeper into the red for the quarter ended Dec. 31, at a 11 billion yen ($92.5 million) loss compared to a 3.7 billion yen loss the same period a year ago.

Sales were up by nearly 4 percent at 556.9 billion yen ($4.7 billion) from 535.8 billion yen, the Tokyo-based company said Monday.

The major Japanese carrier said the fuel bill during the first three quarters of fiscal 2005 was up 30 percent from the same period a year earlier with fuel costs averaging $71 per barrel versus $49 the previous year.

Despite cost-cutting efforts, costs rose from the previous year, mostly because of surging fuel prices, JAL said in a statement.

Passenger numbers fell about 2 percent during the first nine months of this fiscal year at 44.04 million people from 44.84 million the same period the previous year, as passengers declined in both international and domestic travel.

The image of Japan Airlines has been badly tarnished by a series of safety lapses since early 2005.

Despite promises to correct problems, two additional problems have popped up recently, including a JAL affiliate on a Tokyo-Taipei flight that took off with a latch on the emergency exit incorrectly positioned in December. Last month, a JAL aircraft on a domestic flight flew with the reverse thruster on an engine locked into the maintenance position. Both aircraft landed safely.

For the full fiscal year ending March 31, Japan Airlines Corp., the holding company for JAL Group, is forecasting a 47 billion yen ($395 million) loss on 2.195 trillion yen ($18.5 billion) sales, unchanged from what it gave in November.

Cargo traffic from Asia and China to the United States remained steady, according to JAL. Cargo traffic from Japan to Europe and the United Sates, which had been sluggish in the first half of fiscal 2005, picked up at the beginning of the third quarter on solid demand for electronics products such as flat-panel TVs, it said.