TOKYO (Reuters) – ANA Holdings, Japan’s largest airline, swung to a slightly slower-than-expected quarterly operating loss on Friday but maintained its forecast for a record-breaking loss as fresh coronavirus travel restrictions hit the industry.
ANA reported an operating loss of 81.4 billion yen ($ 779.10 million) for the quarter to December 31, from a profit of 40.7 billion yen a year ago, slightly better than an average 83.8 billion yen loss estimated by three analysts in a Refinitive survey.
It maintained its full-year forecast for a record loss of 505 billion yen. That compares with an average forecast of 472 billion yen by 10 analysts in a Refinitive survey.
CFO Ichiro Fukuzawa said this was due to larger than planned cost cuts and strong demand for international freight services. He added that the airline is currently not considering selling assets other than aircraft.
Comparison of the third quarter “with results from earlier in the year gives a clear indication that our recovery is already underway,” Fukuzawa said in a statement.
However, ANA said domestic traffic had begun to decline in December when a new wave of COVID-19 cases in Japan undermined an earlier recovery and led the government to end a subsidized tourism campaign.
ANA has nevertheless said that domestic lines would be the main source of income during the next financial year.
The airline still flies its international routes but with only a fraction of the passengers it had before the pandemic, while its international freight revenues increased by 30% during the first nine months of the financial year due to strong demand.
ANA predicted that demand for international travel would recover to 50% of pre-pandemic levels during this fiscal year, but Fukuzawa said it must be prepared for the opportunity that can be missed by a large margin.
Japan has closed its borders to almost all foreign foreigners in an attempt to curb the pandemic.
($ 1 = 104.4800 yen)
Reporting by Eimi Yamamitsu and Tim Kelly; additional reporting by Jamie Freed in Sydney Editing by Himani Sarkar and Emelia Sithole-Matarise
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