Low-cost airline AIR BUSAN turned to a loss in the second quarter of this year due to poor performance on Japanese routes.
On the 23rd, AIR BUSAN announced that its revenue in the second quarter was 171.4 billion won, a decrease of 27.2% compared to 235.4 billion won in the same period last year. During the same period, operating profit turned from a surplus of 18.1 billion won to a loss of 11.1 billion won. However, net profit, which reflects all financial costs, investment income, taxes, and other factors from operating activities, recovered from a loss of 12.8 billion won in the second quarter of last year to a profit of 27.7 billion won in the second quarter of this year.
As a result, revenue for the first half was 420.9 billion won, down 17.1% from 507.6 billion won in the same period last year, and operating profit plummeted 67.4% from 89 billion won to 29 billion won. Net profit increased 502.8% from 9.9 billion won to 59.9 billion won.
The poor performance on Japanese routes affected the results in the second quarter. Due to rumors of a major earthquake in July, heat waves, and the rising value of the yen, the number of Japanese travelers has significantly decreased. Additionally, operations have been reduced due to damages from a fire that occurred at Gimhae International Airport last January and delays in overseas outsourced maintenance processes.
However, AIR BUSAN noted, "The proactive issuance of perpetual convertible bonds (CB) and the decline in exchange rates led to a 474 percentage point drop in the liability ratio compared to the end of last year." This improvement is interpreted as contributing to the increase in net profit.
As the third quarter is the peak summer season, AIR BUSAN plans to actively improve its performance through increased supply. Accordingly, it has decided to expand proactive operations, focusing on popular summer vacation routes, including the resumption of the Busan-Cebu route, additional flights to Kota Kinabalu and Da Nang, and irregular flights to Boracay from Busan and Incheon.
AIR BUSAN stated, "Based on thorough market analysis, we will focus on efficient supply management and seasonal irregular flight operations to enhance revenue. We will prioritize safety as our core value and commit to thorough safety management and capacity enhancement, striving to secure customer trust and ensure stable operation of our routes."