Korean Air announced its first quarter results for the three months ending 31 March 2006. Attributable primarily to strong domestic and international passenger the airline’s net profit surged by 114.7 per cent to…
Korean Air announced its first quarter results for the three months ending 31 March 2006. Attributable primarily to strong domestic and international passenger the airline’s net profit surged by 114.7 per cent to 127 billion won, compared with 59 billion won for the same period last year. Operating revenue for the period also increased to 1,835 billion won, up 7.8 per cent from 1,702 billion won for the year earlier.
Operating profit grew by 49.3 per cent to 91 billion won during the period and non-operating income increased by 52.8 per cent year-on-year to 254 billion won. Operating profit margin was up 1.4 percentage points to 4.9 per cent in the first quarter this year, compared to 3.5 per cent a year ago.
“We are encouraged to see our financial results continue to improve. The operating environment in the first quarter of 2006 was not without challenges. Fuel costs remained at a high level, yet we were able to offset these and keep the increase in operating expenses at a reasonable level by lowering maintenance and rental expenses,” said Jong-Hee Lee, president of Korean Air.
At the end of the first quarter this year, total assets and total liabilities have gone down 0.9 per cent and 2.2 per cent since the end of 2005, respectively, while shareholders’ equity increased 2.3 per cent. The debt to equity ratio was down to 227 per cent or 10 percentage points, from 237 per cent at the end of 2005. Interest bearing debt dropped 2.2 per cent to 7.4 trillion won at the end of the first quarter.
“Apart from delivering solid financial results, we also enhanced our fleet during the first quarter of 2006. We took delivery of a new freighter and introduced a new passenger route between Incheon and Komatsu and a cargo route between Incheon and Chennai,” said Lee.
Korean Air’s revenue from domestic passengers increased 4.6 per cent despite a 1.6 per cent reduction in capacityand yield rose 4.7 percentage points compared to a year earlier.
Revenue from international passengers grew 9.8 per cent, thanks to a 7.6 per cent growth in APK (available seat kilometers) and a 7.3 per cent growth in RPK (revenue per passenger kilometer).
Vicky is the co-founder of TravelDailyNews Media Network where she is the Editor-in Chief. She is also responsible for the daily operation and the financial policy. She holds a Bachelor's degree in Tourism Business Administration from the Technical University of Athens and a Master in Business Administration (MBA) from the University of Wales. She has many years of both academic and industrial experience within the travel industry. She has written/edited numerous articles in various tourism magazines.
