JAL's Recovery On Track

JAL Records Higher Profit Than Originally Planned 
/JAL To Get New Capital

From Jiji Press and Yomiuri Shimbun, 26 February 2011

Japan Airlines, under corporate rehabilitation, will  be highly likely to          record consolidated profit of JPY170 billion (US$2 billion) at the end of March 2011. This amount is 2.6 times larger than the originally planned profit by the corporate rehabilitation plans as submitted to the Tokyo District Court at the end of last August, attributed to the company’s overall cost reduction efforts. The forecasted amount of profit is the record high in the history of JAL The higher cash flow will help the airliner to strengthen its financial foundation, the company’s weak point over the years.

JAL will welcome additional financial help from eight companies as capital investment of JPY 20 billion at maximum. New investors will include Tokio Marine and JTB, travel agency among other six companies of Daiwa Securities, Kyocera, Mitsui Sumitomo Marine and Fire, Sompo Japan, MS & AD Insurance and Hankyu Travel. JAL first wanted a larger capital investment  as much as 50 billion yen; as the result of JAL’s overall management performance will lower the amount to 20 billion level.

Apart from that, JAL  expects a new financial loan equivalent of JPY280 billion from major dealing five banks led by Development Bank of Japan as well as new members such as Mitsubishi UFJ Trust and Banking, Aozora, Tokyo Star, Chiba Banks as well as Okinawa Development Finance Corporation.

Incrediby Shrinking Japan Airlines

from Sankei Shimbun August 30,2010 and others


Japan Airlines will submit its rehabilitation plans to the Tokyo District Court on August 31 upon approval of the cabinet ministers. On the same day at evening, Chairman Mr. Kazuo Inamori will meet the press conference with Ken Ohnishi, President with officials of Enterprise Turnaround Initiative Corporation of Japan (ETIC), serving as JAL’s receiver.

The plans call for 1) write-off of its debt of 521.5 billion yen (about $6 billion) by syndicate banks 2) new investment by ETIC 3) slashing of employees up to about 16,000  at group wide 4) abolish 45 routes, domesitc and international, by March 2011.

JAL has announced its plan to merger JALWAYS, its subsidiary operator as well as its accounting firm in this year.

JAL wishes to see its stocks relisted at Tokyo Stock Exchange by the end of 2012 after a further restructuring and increased corporate values. The airline hopes to repay 350 billion yen of public fund by selling its stocks. The district court will decide on the approval to the plans by the end of November.

Accotrding to JAL’s plans, the airline is considering to launch its own LCC subsidiary. Its rival ANA has issued its plans to start low cost carrier earlier in August.