TOKYO -- Japan Airlines is expected to report another big loss for the July-September quarter as international traffic remains in a pandemic-induced slump.
The carrier's operating loss apparently came to about 85 billion yen ($812 million), compared with a 60.2 billion yen profit a year earlier. Revenue sank 70% to around 110 billion yen, with passenger traffic on international flights down 97%.
A government program to promote domestic travel boosted traffic in Japan, nearly tripling from the April-June quarter. Combined with cost cutting, JAL narrowed its operating loss on a quarterly basis.
Analysts had projected a 71.5 billion yen loss on average. Despite the pickup in domestic traffic, fares appear to have taken a hit as the coronavirus resurgence in August dampened demand during the peak summer travel season.
JAL is redoubling cost-cutting efforts to stem the losses, laying out plans in August to further reduce fixed costs associated with aircraft and labor.
The global airline industry continues to face severe headwinds amid the pandemic. Combined losses at U.S. carriers Delta Air Lines, United Airlines and American Airlines reached nearly $10 billion for the July-September quarter.
JAL's overall financial health does not appear to be in doubt, with the company's capital ratio standing at 46% at the end of June. And for the year ending March 2021, the carrier projects a path to monthly profitability if traffic recovers to 50% of pre-pandemic levels on international flights and 80% on domestic routes.
But with winter raising the specter of another wave in the pandemic, the prospects of a recovery remain unclear.