By Chris Cooper
May 12 (Bloomberg) — Japan Airlines Corp., the country?s biggest carrier, predicted a second straight year of losses as companies cut back on business trips amid a global recession.
Japan Air may post a loss of 63 billion yen ($648 million) for the fiscal year ending March 31, following a loss of 63.2 billion yen last year, the Tokyo-based company said in a statement today. Sales will probably decline 10 percent to 1.75 trillion yen from last fiscal year.
The airline is suffering from its biggest drop in overseas passengers since outbreaks of SARS and bird flu sapped travel demand in 2003. The airline, also known as JAL, aims to cut 195 billion yen in costs this fiscal year to stem losses, it said today.
?Waning demand for international transportation, swine flu and a slowing global economy are hurting Japan Air,? said Yasuhiro Matsumoto, an analyst in Tokyo at Shinsei Securities Co.
JAL carried 12.4 percent fewer passengers internationally last business year, the biggest drop in five years.
The airline industry globally may lose as much as $4.7 billion this year as the deepening recession wipes out $62 billion of revenue, according to the International Air Transport Association. Carriers in Asia-Pacific are expected to post combined losses of $1.7 billion, the biggest of any region.
Japan Air fell 1 percent to 192 yen as of the 11 a.m. close of morning trade in Tokyo.
The carrier plans to slash about 1,200 jobs this fiscal year as part of its cost reduction plan through attrition and reduced hiring, Hisanori Iizuka, a company spokesman, said ahead of the earnings announcement in a telephone interview in Tokyo today. The Nikkei newspaper reported the job cuts earlier.
To contact the reporters on this story: Chris Cooper in Tokyo at [email protected]