JAL is planning a yen bond sale next month, people familiar with the matter said, in what would be its first debt sale since March last year as its yield premiums fall. The Tokyo-based carrier has hired banks for an offering of about 10b yen ($92m) of five-year notes, said the people. A Japan Airlines spokesperson declined to comment. The yield premium on JAL’s 2023 bonds widened more than 50 basis points to 104 basis points in May last year as the Covid-19 pandemic put the brakes on international travel, but the spread has decreased 25 basis points since then as vaccine roll-outs spark expectations of a gradual recovery in tourism, Bloomberg-compiled data show. Japan Airlines declined earlier this month to issue any profit guidance due to uncertainty surrounding the pandemic as it reported a loss for the year ended March 31. But recent debt offerings by airlines suggests there’s demand among investors for the sector’s notes as they bet on a rebound in passenger traffic after an easing in infections. <br/>
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Qantas is on the path to recovery from the coronavirus crisis thanks to a domestic holiday boom, with the airline forecasting an underlying profit for the current financial year. Revenue from routes within Australia -- which has almost completely suppressed Covid-19 -- is expected to almost double in the half year ending June 30 from the previous six months as people holiday at home, Qantas said Thursday. Domestic air-travel demand is even greater than it was before the pandemic, the airline said. “We have a long way still to go in this recovery, but it does feel like we’re slowly starting to turn the corner,” CEO Alan Joyce said. “The business is now on a more sustainable footing.” With a global air-travel rebound still in its infancy, airlines with extensive domestic networks, from Qantas to American Airlines and Delta in the US, are faring best. Qantas and low-cost unit Jetstar have together added 38 new routes since July last year. Sydney-based Qantas now forecasts underlying earnings of between A$400m and A$450m for the 12 months ending June 30, and says net debt has peaked. The pretax loss for the period, including aircraft writedowns and staff layoff costs, will exceed A$2b, it said. The airline said consumer confidence is “proving more resilient” compared with the early days of the crisis.<br/>