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Kinki Nippon Tourist Co. said Wednesday it posted a group net loss of 3.27 billion yen in the January-June period, mainly due to the war in Iraq and the outbreak of SARS. The travel agency reported a loss of 5.39 billion yen in the same period a year earlier.

Sales in the six-month period slipped 6.2 percent to 46.62 billion yen. The war and severe acute respiratory syndrome dealt a heavy blow to the company, which saw revenue from overseas travel drop 26.9 percent from the previous year.

“The war had been anticipated, so we had shifted our focus to China” around the start of the year, said Koichi Yoshida, the company vice president. “But then there was the SARS outbreak, which almost destroyed” the firm’s plan.

He said the negative impact from the two events is likely to linger until October.