ANA Holdings posted record-high operating revenue and operating income for the first half of FY2023 (April 1 to September 30) and has decided to pay a dividend of 30 JPY for the first time in five years although the financial forecast for the full year of FY2023 is unchanged from the previous announcement.
ANA increased operating revenue by 26.8% year on year to 1 trillion JPY, operating income by 312.6% to 129.7 billion JPY, ordinary income by 32.1% to 127.3 billion JPY and net income by 377% to 93.2 billion JPY.
Higher yield on international passenger flights
ANA increased both carried passengers and revenue on international passenger flights as a result of strong demand for inbound travel to Japan, as well as proactive efforts to capture transit demand between North America and China and Asia, and efforts to boost leisure demand originating from Japan. Passenger revenue was up 122.1% to 358.6 billion JPY, and passengers were up 109.2% to about 3.5 million.
Koji Shibata, ANA Holdings CEO, explained, “Flight volume is not recovered completely yet, but yield is higher because supply does not catch up with demand particularly on routes between North America and China and Asia and also the Europe routes.”
ANA has forecasted that international flight demand will be back to around 80% of the 2019 level in March 2024. While inbound travel demand is growing, outbound travel demand is still stagnated with around 35% of the 2019 level. Shibata revealed that the exchange rate of 125 JPY a dollar may be appropriate when the balance between inbound and outbound travel demands is considered.
Complete recovery of domestic flight demand is expected in the end of this year
Both passenger volume and revenue on domestic flights increased year-on-year due to efforts to stimulate leisure demand through the "ANA SUPER VALUE" sale and other measures. Passenger revenue was up 33% to 322.9 billion JPY, and passengers were up 34.6% to about 20 million. Shibata said, “Business travel demand is still weaker than initially expected, but leisure travel demand will recover to the pre-pandemic level in the end of this year.”
Peach Aviation, a LCC of ANA Group, increased passenger revenue by 65% to 67.3 billion JPY and passengers by 27.1% to about 4.7 billion, although bookings in China have recently decreased.
ANA remains the financial forecasts for the full year of FY2023: operating revenue of 1.97 trillion JPY, operating income of 140 billion JPY, ordinary income of 115 billion JPY and net income of 80 billion JPY, expecting revenue reduction of 8 billion JPY due to inspection of Pratt & Whitney engines on A320neo and A321neo, and another 40 billion JPY due to higher oil prices and so forth.