Annual Report 2005 (60 pages / 1.3MB) - JAL | JAPAN AIRLINES

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Spreading New Wings of Trust Becoming the world’s No.1 airline group in terms of both service quality and business volume Building a robust business framework that works under any conditions The sharp rise in fuel prices is just one of many factors to buffet the aviation industry now and in years to come. The JAL Group is preparing to deal with these factors by means of its 2005–2007 Medium-Term Business Plan, which calls for it to restructure its businesses and costs. The overriding goal is to build a robust management framework, a business structure which can produce profits even in the face of factors such as rising fuel costs or slowing demand. Medium-Term Business Plan: Three Threads To overcome fierce competition and leverage opportunities Fuel Prices continuing at recordhigh levels International passenger operations External negative factors persist, recovery underway* Domestic passenger operations Competitive network almost complete To restructure in a way to allow profitability even in the face of slowing demand and high fuel prices: Medium-Term Business Plan: Three Threads 1. Restructure international passenger operations 2. Revamp cost structure 3. Aggressively develop growth markets International cargo operations Continuing to invest as growth continues * Outlook for FY05 IP demand: 104% vs. FY02, 96% vs. FY00 8 Japan Airlines Corporation
Vision: What JAL Group strives to achieve Conditions affecting JAL Group: Analysis JAL Group Strategy: Medium-Term Business Plan Becoming the world’s No. 1 airline in terms of both service quality and business volume means reaching the top level in three separate aspects: service (customer evaluations and on-time record), profitability (consolidated operating profit), and corporate value (market capitalization). To become our customers’ airline of first choice, we will endeavor to provide customers with even more convenience by enhancing human service. Our goal for market capitalization is to be the top network carrier in this regard. International passenger demand is still recovering, but we have nearly reached competitiveness with our domestic network, and growth in international cargo continues. Negative factors include some over which we have no control, such as rising fuel prices, terrorism, war, and natural disasters, but these are offset by positive factors including the strong growth in Asia and China, as well as Haneda Airport’s new runway No.4.Competition is intensifying, and at the same time business opportunities are multiplying. JAL Group has prepared its 2005–2007 Medium-Term Business Plan laying out three strategies: restructuring its international passenger business, revamping cost structures, and aggressively expanding growth markets. It sets out how we will win out over our competition and leverage our opportunities. The Group is united in its determination to build a business model which can be profitable even in the face of slowing demand or higher fuel prices, while maintaining our commitment to safety and CSR. Vision Becoming the world’s No. 1 airline group in terms of both service quality and business volume means … Service perspective Satisfaction rating • Human service • Intent to fly again • Convenience, etc Aim to become first among network carriers (3rd as of March 9) Profitability perspective Consolidated operating profit Corporate value perspective Market capitalization We are aiming at the top level in all three categories. 9
Page 1 and 2: Japan Airlines Annual Report 2005 Y
Page 3 and 4: JAL GROUP OVERVIEW Comprising 288 s
Page 5 and 6: MESSAGE FROM THE GROUP CEO REVIEW O
Page 7 and 8: We will carry out the Medium-Term B
Page 9: much less unaffected. Moving ahead,
Page 13 and 14: Managing international passenger op
Page 15 and 16: Growing and Continuing Impact of St
Page 17 and 18: Segment-by-Segment Strategies for G
Page 19 and 20: Basic Management Strategy Basic ini
Page 21 and 22: Revenue analysis: international pas
Page 23 and 24: Revenue analysis: domestic passenge
Page 25 and 26: Related Operations Many Group compa
Page 27 and 28: MANAGEMENT’S REVIEW AND ANALYSIS
Page 29 and 30: Consolidated total stockholders’
Page 31 and 32: Net cash used in investing activiti
Page 33 and 34: Liabilities and stockholders’ equ
Page 35 and 36: CONSOLIDATED STATEMENTS OF STOCKHOL
Page 37 and 38: Thousands of U.S. dollars Millions
Page 39 and 40: e. Property and equipment Property
Page 41 and 42: Proceeds from sales of securities c
Page 43 and 44: The significant components of defer
Page 45 and 46: 11. Commitments and Contingent Liab
Page 47 and 48: . Operating revenues from overseas
Page 49 and 50: CONSOLIDATED SUBSIDIARIES Japan Air
Page 51 and 52: JALPAK INTERNATIONAL MICRONESIA, IN
Page 53 and 54: JALUX LIFE DESIGN INC. OFFICIAL FIL
Page 55 and 56: MOSCOW 4th Floor, GALS Tower, 1st T
Page 57 and 58: International Routes Domestic Route
Page 59 and 60: INVESTOR INFORMATION Company Name:

Annual Report 2005 (60 pages / 1.3MB) - JAL | JAPAN AIRLINES

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