TOKYO: ANA Holdings Inc. said Friday it expects to post a consolidated net loss of 100 billion yen for the fiscal year ending in March 2022, marking a second straight year of loss.

The major Japanese airline had previously predicted a net profit of 3.5 billion yen.

The downward revision reflects lower-than-expected passenger revenue as the impact of the COVID-19 pandemic has lasted longer than predicted, despite the recent drop in infection cases.

The company will cut more staff than it had initially planned, in order to curb costs.

It revised down its sales forecast for the year from 1.38 trillion yen to 1.06 trillion yen.

The group will reduce its workforce by some 5,000, or 10 pct of its total, by the end of fiscal 2022, through retirement programs and curbing new hires.

All Nippon Airways, the group’s core unit, plans to reduce the number of employees of its aviation business by some 9,000, or over 20 pct of the total, by the end of fiscal 2025.

ANA Holdings logged a record consolidated net loss of 404.6 billion yen for the year that ended in March this year.

In the current fiscal year, the impact of the pandemic was prolonged mainly by the government’s state of emergency following the spread of a highly infectious novel coronavirus variant.

Demand was sluggish not only for international flights, affected by stricter border controls that remain in place amid the virus crisis, but also for domestic flights.

While demand has been robust for international cargo flights for semiconductors and other electronics parts and recovering for domestic flight services, ANA Holdings concluded that it would be difficult to overcome losses.

“The full-scale recovery in demand has been put off to a much later date, and we cannot cover the revenue lost in the first-half period,” ANA Holdings President Shinya Katanozaka told a news conference.

Meanwhile, he noted that demand is expected to recover in line with progress in COVID-19 vaccinations and the development of drugs to treat coronavirus patients, stressing that his company “must move into the black in the next year.”

For the first half to September, ANA Holdings posted 431,125 million yen in sales, up 47.7 pct from a year before.

Its net loss totaled 98,803 million yen, far below the year-before figure of 188,477 million yen.

The drop came after the company reduced personnel costs by sending workers to other companies and cut flight services flexibly in line with demand.

JIJI Press