TOKYO (Reuters) - ANA Holdings, Japan’s biggest airline, swung to a slightly narrower than expected quarterly operating loss on Friday but kept its forecast for a record full-year 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 Dec. 31, from a 40.7 billion yen profit a year ago, slightly better than an average 83.8 billion yen loss estimated by three analysts in a Refinitiv poll.
It maintained its full-year forecast for a record operating loss of 505 billion yen. That compares with an average 472 billion yen loss forecast by 10 analysts in a Refinitiv survey.
Chief Financial Officer Ichiro Fukuzawa said this was due to bigger-than-planned cost cuts and a strong demand of international freight services. He added that the airline is currently not thinking of selling assets other than aircraft.
Comparing the third quarter “to results from earlier in the year provides 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 fresh wave of COVID-19 cases in Japan undermined an earlier recovery and led the government to end a subsidised tourism campaign.
ANA nonetheless has said that domestic routes would be the main source of income in the next business year.
The airline is still flying its international routes but with only a fraction of the passengers it had before the pandemic, while its international cargo revenues rose 30% in the first nine months of the financial year due to strong demand.
ANA projected that international travel demand would recover to 50% of pre-pandemic levels this fiscal year, but Fukuzawa said it needs to be prepared for the possibility that could be missed by a big margin.
Japan has closed its borders to nearly all foreign non-residents in a bid to contain 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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