All Nippon forecasts full year profit on cost cuts
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All Nippon Airways Company (ANA) Japan’s largest domestic carrier, said it will return to a profitability this fiscal year helped by cost reductions as the global recession slashes demand for air travel.
ANA forecast profit will be JPY 3 billion (US$31 million) for the year ending March 31, compared with a loss of JPY 4.26 billion last year, the Tokyo-based company said in a statement today. Sales at the carrier will probably drop 3.1 % to JPY 1.35 trillion.
The airline aims to slash costs by JPY 73 billion this fiscal year helped by lower fuel prices, landing fees and labor expenses, Chief Financial officer Tomohiro Hidema said in a press conference in Tokyo. ANA’s JPY 18 billion in cost cuts last year were not enough to avoid reporting its first loss in six years after the number of overseas passengers fell the most since 2003.
“There are no signs of a recovery in passenger numbers as yet,” said Mitsushige Akino, who oversees US$615 million in assets in Tokyo at Ichiyoshi Investment Management Co. “Without a rebound in demand later this year ANA may have to consider further cost cuts.”
Source: Bloomberg
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