Japan Airlines Corp. said Friday it posted a group net loss of 40.7 billion yen in the April-June quarter, compared with a 77.2 billion yen loss in the same period a year earlier.

The improvement was attributed to a recovery in international passenger numbers.

The airline industry saw a huge loss in international flight revenue in fiscal 2003 due to the outbreak of severe acute respiratory syndrome and the war in Iraq.

In the first quarter of fiscal 2004, the nation’s largest carrier posted a group operating loss of 30.2 billion yen, while its consolidated sales rose 20.2 percent to 479.3 billion yen.

JAL said the number of international passengers jumped 75.5 percent from a year earlier, pushing revenue generated from international flights up by 45.9 percent to 192 billion yen.

The number of passengers on domestic flights fell 5.8 percent from the previous year, though a fare increase in July meant that domestic flight sales rose 2.7 percent to 159 billion yen.

Soaring oil prices, the industry’s major concern, cost the firm 6.1 billion yen more than the previous year, prompting the carrier to fear a 30 billion yen drop in operating profit for the full fiscal year.

But JAL officials maintained that it will not change its April earnings projection of 81 billion yen in group operating profit and 36 billion yen in net profit.

They said the firm will be able to cover the shortfall via measures such as raising international airfares by 5 percent and cutting costs.

Meanwhile, rival All Nippon Airways Co. said the same day that it posted a group net profit of 2.4 billion yen in the first quarter due to a recovery in international flights and rigorous cost-reduction efforts.

ANA’s consolidated sales rose 14.5 percent to 297.2 billion yen, while its operating profit increased 37.5 billion yen to 8.8 billion yen. The carrier said its number of international passengers rose 67 percent, with flights to Europe and the United States contributing in particular to the 61 billion yen generated in sales from international flights.

Sales from domestic flights rose 7 percent to 157 billion yen.

The carrier was able to cut 6 billion yen in costs — mainly those tied to personnel — by slashing employee salaries by 5 percent from April.

The firm believes rising oil prices will hit it to the tune of 9 billion yen in the current fiscal year, though it said it will be able to cover the costs by positive results in the first quarter, as well as by raising international fares by 5 percent.

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