Asiana Reports Operating Loss of 208.2 Billion KRW in Q1... Deficit Widens Due to COVID-19 Impact

[Image source=Yonhap News]

[Asia Economy Reporter Kim Hyewon] Asiana Airlines announced on the 15th that its operating loss based on separate financial statements for the first quarter reached 208.2 billion KRW due to the impact of the novel coronavirus infection (COVID-19). The deficit widened compared to the same period last year.

During the same period, sales amounted to 1.1295 trillion KRW, a 21.5% decrease compared to the same period last year, and the net loss continued at 549 billion KRW.

The passenger sector was a major cause of the first quarter's performance deterioration as demand sharply declined from February when various countries worldwide began restricting entry of Koreans. During this period, the number of international flights operated remained at about 8% of the original plan.

On the other hand, the cargo sector partially offset the operating loss in the first quarter due to a continued recovery in demand following the US-China trade dispute agreement and increased exports of IT-related items such as semiconductors, computers, and wireless communication devices by domestic companies, which increased cargo volume and improved profitability.

Asiana Airlines plans to continue strong self-help measures for survival, anticipating an inevitable contraction in passenger demand for a certain period due to the global spread of COVID-19.

Since March, the company has indefinitely extended the wage reductions of all executives including the CEO until the COVID-19 situation ends, and expanded unpaid leave, which was previously applied only to general staff, to all employees. Unpaid leave of more than 15 days for all employees will continue until business volume normalizes. Additionally, paid leave on a two-month basis is being implemented concurrently for some field staff such as cabin crew and domestic airport branch workers.

Efforts to improve performance also continue. Due to the sharp decline in flight operations caused by COVID-19, Asiana Airlines is focusing on securing alternative routes through charter flights. Since April, special charter flights have been operated to countries such as Vietnam and Turkey to transport domestic company personnel locally, and special charter flights have also been operated to transport overseas Koreans.

From June, the airline will resume flights on some international routes to the Americas, Southeast Asia, and China, which had been reduced due to COVID-19. The decision was made to proactively increase flights mainly on business routes with frequent corporate and official trips. Accordingly, 13 international routes will be resumed from June, and the weekly number of flights will be increased to 110, raising the operation rate to about 17% of the original plan.

This content was produced with the assistance of AI translation services.