Japan's Biggest Airline to expand budget aviation business, Q3 profit shines

TOKYO, Feb 1 (Reuters) - ANA Holdings Inc, Japan’s biggest airline by revenue, said on Thursday it plans to expand its lower-cost carriers business in the medium-haul segment due to robust travel demand in Asia, after it notched a strong third quarter performance.

In its mid-term plan, the carrier said it was aiming for 2.45 trillion yen ($22.4 billion) in revenue in the fiscal year 2022, up 27 percent from the 1.925 trillion yen seen in the current fiscal year through March. It also expects 50 percent growth in its core international service.

ANA overtook its once-bankrupt rival Japan Airlines Co (JAL) in 2016 to become the country’s biggest international airline and holds a higher Skytrax rating for passenger service and comfort.

ANA benefitted from JAL’s bankruptcy by winning slots at Haneda Airport, the airport preferred by business travellers departing from or arriving in Tokyo.

The airline is also a major player in the growing budget aviation market in Japan, where its brands Vanilla Air and Peach Aviation compete against Jetstar Japan, a joint venture between JAL and Australia’s Qantas Airways Ltd, as well as a newly re-launched AirAsia Japan.

Operating profit jumped around 25 percent in the three months to December, to about 50.9 billion yen ($465 million), according to Reuters calculations based on the company’s results for the first nine months of the fiscal year.

ANA maintained its forecast that operating profit for the year to March would hit 160 billion yen.