Japan's ANA swings to annual operating profit as demand returns

TOKYO: Japan's largest airline ANA Holdings on Thursday (Apr 27) reported an annual profit for the first time in three fiscal years, buoyed by recovering travel demand at home and abroad after pandemic restrictions were lifted.

The company said its operating profit was expected to improve further this year.

Domestic demand is forecast to recover to 95 per cent of pre-pandemic levels and international demand to 70 per cent, up from 80 per cent and less than 40 per cent respectively in the 12 months ended Mar 31, it said.

ANA recorded a 120.03 billion yen (US$897.6 million) operating profit for the 12 months ended Mar 31, beating a 97.9 billion yen consensus forecast from 12 analysts polled by Refinitiv. It had reported a 173.1 billion yen operating loss in the prior year.

Japan's easing of border control measures had a major impact, especially on inbound travellers since the third quarter, ANA Chief Executive Koji Shibata told reporters.

Visitors to Japan surged to 1.82 million in March, the highest level since the start of the COVID-19 pandemic, the national tourism agency reported earlier this month.

Japan is looking to bring forward the end of COVID-related border control measures requiring a vaccination certificate or negative test to Saturday from May 9, Jiji reported, in hopes of easing congestion at airports before the start of a week-long holiday.

ANA's forecast of a 140 billion yen annual operating profit for this financial year starting Apr 1 was in line with an average 140.2 billion yen forecast from analysts surveyed by Refinitiv.

The full-year results came after the company revised its guidance on Friday, lifting its profit estimate by around 26 per cent to 120 billion yen, citing lower fuel prices and a stronger yen.

Annual revenue climbed 67.3 per cent to 1.7 trillion yen and is forecast to increase by 15.4 per cent this fiscal year.

ANA said it would buy back up to 0.6 per cent of its shares worth 9 billion yen before the market opened on Friday.