Japan Airlines Corp. fell into the red in fiscal 2005 due to falling passenger numbers and high fuel prices, marking a stark contrast to archrival All Nippon Airways Co., which had record profits and sales.

According to consolidated financial results released Wednesday, JAL reported a net loss of 47.2 billion yen for the year that ended March 31, compared with a net profit of 30 billion yen the year before.

The nation’s largest carrier reported an operating loss of 26.8 billion yen. Last year, it logged an operating profit of 56.1 billion yen.

Sales rose 3.2 percent to 2.2 trillion yen thanks to a series of fare hikes and increased fuel surcharges, which generated some 50 billion yen in revenue.

Suffering a rash of safety problems since early last year, JAL saw passengers on its domestic flights switch to other carriers, resulting in a 30 billion yen loss in revenue in domestic operations.

Blaming high fuel prices and safety-related incidents for the poor performance, Senior Vice President Haruka Nishimatsu, who is set to become JAL’s chief executive in June, said, “We need to regain public trust as soon as possible by making step-by-step efforts to secure safety.”

Nishimatsu said high fuel prices are still a threat to the carrier, especially as it has a large international flight network, including long-haul flights that require a lot of fuel.

He said if the price of Singapore jet fuel increases by $1 per barrel, JAL’s fuel bill would go up 4.5 billion yen for the year.

Rising oil prices cost JAL 88.2 billion yen more in fiscal 2005 than the previous year, as oil prices averaged $72.1 per barrel of Singapore kerosene, compared with $49.8 per barrel the previous year.

Despite its difficult business environment, the carrier has maintained an ambitious target for the current fiscal year. JAL hopes to return to the black, forecasting a net profit of 3 billion yen, operating profit of 17 billion yen and sales of 2.3 trillion yen.

“We will carry out the cost-reduction efforts as stated in our midterm (2006-2010) business plan, while looking to increase business and first-class passengers to increase revenue,” Nishimatsu said.

Last month, ANA reported record-high consolidated pretax profit, operating profit and sales for fiscal 2005.

The country’s No. 2 carrier announced a 14 percent rise in operating profit to 88.8 billion yen for the fiscal year that ended March 31. Pretax profit rose 2.3 percent to 66.7 billion yen. It reported a 5.8 percent increase in sales to 1.37 trillion yen.

But ANA’s net profit declined 0.8 percent from the previous year to 26.7 billion yen due to changes in accounting standards related to the impairment of fixed assets.

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