Japan's domestic air travel recovery gives ANA a lift as JAL disappoints

Japan's two biggest airlines expect to benefit unequally from the country's recovery in domestic travel, though both have high hopes for the return of Chinese tourists. ANA Holdings, the country's largest airline by revenue, raised its earnings forecast for the year through March to 1.71t yen ($13.2b) in revenue and 60b yen in net profit, compared with the 1.7t yen and 40b yen it had previously forecast. "The largest cause of our good performance is the robust recovery of travel demand," Kimihiro Nakahori, chief financial officer of ANA, told reporters on Thursday, after it reported its Q3 results. The airline was buoyed by government-led domestic travel subsidy campaigns that began in October and January and by the resumption of visa-free entry for foreign travelers in October. In the nine months through December, its domestic and international flight sales jumped 89.9% and 501.9% on the year, respectively. "Our focus had been on managing costs, but we are starting to think about how we can expand our top line from now on," Nakahori said. "We will pursue further recovery." Japan Airlines, on the other hand, revised down its full-year earnings forecast on the same day. JAL now expects its revenue for this fiscal year to hit 1.35t yen and net profit to be 25b yen, compared with the previous forecast of 1.4t yen and 45b yen. JAL said lower-than-expected performance in the domestic flight segment was a major cause for the revision. Its sales in that segment for April-December were up around 93% on the year. "We feel sorry [for the revision]," said Hideki Kikuyama, representative director at JAL. Domestic bookings for January and February were around 20% lower than the company had expected. The number of passengers is expected to return to 95% of JAL's forecast in March, he added.<br/>