Press Release

The JAL Group today announced the consolidated financial results for the third quarter of FY2021.

1) JAL Group Consolidated results for the Period April 1, 2021 – December 31, 2021

JAL Group’s business environments in the Third Quarter of FY2021, the international
passenger demand recovered steadily with a base demand of returnees or expatriates and
a transit demand between Asia and North America. The domestic passenger demand
recovered robustly after October, compared with the first half of this fiscal year when the
demand was sluggish due to a surge of new infections and repeated declarations of a state of emergency. On the other hand, the international air cargo demand remained very high due to mainly auto-related shipments or semiconductors bound for North America in the
prolonged disruption of ocean transport. In the business environments, securing safety for
our passengers and employees, which is our Group’s basic foundation, as the first priority,
the JAL group has been seeking to fulfill its responsibilities by sustaining both international
and domestic air transport network for passengers who need to travel.

The revenue for the Third Quarter was 498.4 billion yen with an increase of 141.9 billion yen, up 39.8% from the same period in the previous year, and the operating expenses were
687.9 billion yen, with an increase of 32.4 billion yen, up 5.0% year-on-year. EBIT was a loss of 183.3 billion yen, significantly improved from 294.1 billion yen year-on-year, narrowing the
loss by 110.8 billion yen. Net loss attributable to owners of the parent improved by
84.4 billion yen from a loss of 212.7 billion yen to a loss of 128.3 billion yen year-on-year.

International Passenger revenue was 48.4 billion yen (156.8% up year-on-year), and
Domestic Passenger revenue was 174.4 billion yen, (27.4% up year-on-year). Cargo mail revenue was 161.0 billion yen with an increase of 77.1% year-on-year.

Details of the consolidated financial results are as follows (Including LCC):

(1) Other Revenue = Travel Agency, Mileage, Ground Handling or etc.
(2) Others = Gain or Loss on Sales of Flight Equipment, Other Revenue, Share of Profit or Loss of Investment and Income/Expenses from Investment
(3) EBITDA Margin = EBITDA / Revenue EBITDA= EBIT + Depreciation

2) JAL Group Summary of Consolidated Statement of Financial Position and Cash Flow 

-Equity Ratio and Net D/E Ratio for credit rating was improved by the hybrid financing to a solid level of 42.9% and 0.2x,respectively. Despite the prolonged difficult situations, we are able to maintain
​financial soundness.
-Liquidity at hand increased to 518.3 billion yen at the end of December. Together with the unused credit line of 300 billion yen, we have secured enough liquidity at hand.
-Because of demand recovery mainly in Domestic Passenger, the third quarter period cash flow
turned positive for the first time since the fourth quarter of FY2019. It turned to 9.1 billion yen of cash inflow. EBITDA also turned positive of 11.8 billion yen.

3) Third Third Third Quarter of FY2021 and recent initiatives

Safety and Secure initiatives
-In order to provide our passengers with safety and comfort as well as easier access to air transport, we have extended to Haneda, New-Chitose (Sapporo), Itami (Osaka) and Naha Okinawa Airports
​“JAL SMART AIRPORT” that provides “contact-less” touch-screen check-in kiosks.
-The digital certificate app “VeriFLY” for easier travel from Japan to U.S. Mainland has been in full
use.
-“JAL FlySafe”, together with JAL’s excellent services and sustainability initiatives toward its
management goal of net zero CO2 emissions by 2050, were rated as the world’s highest standards, and APEX (Airlines Passenger Experience Association) awarded JAL “WORLD CLASS” for the first
time to Japanese airlines.

New initiatives in the LCC and non-aviation domains
-Our mid- and long-haul international low-cost carrier, ZIPAIR Tokyo (ZIPAIR), started the first LCC’s non-stop
flights from Asia to Los Angels from December 25, which made the total ZIPAIR routes to five.
-We disclosed on November 2 a joint tender offer plan with Sojitz Corporation to make JALUX a consolidated
subsidiary by the end of this fiscal year toward leaping business expansion
and profit growth in that domain.

ESG Management to achieve SDGs
-Members of oneworld alliance, to which we belong,
announced that they will jointly purchase Sustainable Aviation Fuel (SAF) from Aemetis.
-Renewal to fuel-efficient aircraft, we have conducted steady introduction of Boeing 787s and Airbus 350s amid the difficult financial situations, and JAL has almost completed its Airbus 350 renewal for
its domestic large-scale fleets.

Expense
-We responded to the decrease of demand by making continuous efforts of reducing our capacity to minimize
our operating cost, together with fixed cost restructuring by in-sourcing operations instead of outsourcing,
reducing IT expenditure and reducing personnel cost including executives’ salaries and employees’ bonus cut.
-The Actual Fixed Cost for the third quarter period was 346.7 billion yen, reduced by 22.8 year -on -year. 
-In the previous financial reporting of the second quarter, we revised our Actual Fixed Cost forecast from the
original 500 billion yen to 475 billion yen because of further cost reduction of 25 billion yen. We have been
successful in cutting cost even further. As a result, our full t, our full -year Actual Fixed Cost will be at a 470
billion yen level. 

(1) Services = Expenses regarding inflight services, airport lounges, cargo equipment, etc
(2) Other Variable cost = Travel agency, Mileage, Ground handling or etc.
(3) These are nominal fixed costs however that include variable parts that are linked to capacity or passenger
numbers and one-time/additional

4) Explanations of Forecast of Consolidated Financial Results
As for the forecast of consolidated financial results, considering the cargo revenue increase
and further cost reduction as well as unforeseeable effects of new variants to passenger
demands, we determined not to change our forecast at this moment. We will immediately
update the consolidated performance forecast, if necessary, while keeping a close eye on
recent outlook.

5) Dividends
The prolonged effect of COVID-19 made our situation very difficult, resulted in the third quarter EBIT as loss of 183.3 billion yen. Further, Omicron variant made the future outlook very unforeseeable. Considering the above, to maintain liquidity at hand and financial robustness as our first priority in order to ensure risk tolerance, we
regrettably forecast no year-end dividends for this fiscal year. We sincerely apologize to our shareholders and
investors, and would like to ask for their understanding amid the very difficult situation that we are currently in.