Currency zaps Korean Air net profit as operating earnings rise

KOREAN AIR posted a net loss of KRW233.1 billion (US$196 million) in the flag-carrier's second quarter ending June 30, against a net profit of KRW78.5 billion a year earlier, the company said in a statement.

A stronger won brought on foreign exchange losses and non-operating costs, but his was offset by a record high operating profit as higher cargo and passenger volumes continued in line with the global economic recovery.

"A stronger won drove up non-operating expenses, in particular dollar-denominated debts in books," a spokesman told Dow Jones.

Quarterly operating profit came in at KRW352.1 billion, which compares with an operating loss of KRW127.3 billion in the year-earlier quarter, while revenues were up 37 per cent to KRW2.83 trillion from KRW2.07 trillion, the statement said.

But analysts said the carrier's full-year results were expected increase as the recovery takes root in Asia, encouraging more travel and cargo volumes.

Cargo deliveries of liquid crystal displays, semiconductors, handsets and auto parts increased to the US, Europe and Japan, said the company statement.

With plans to for services to Hong Kong, Osaka and Bangkok from the city of Cheongju in the second half, and increase international flights to Atlanta and Los Angeles, the company expects profitability to rise sharply from the third quarter.

"The quarterly bottom line got a hefty boost from a sharp increase in outbound travel to neighbouring countries such as China and Japan and in long-haul routes to Europe and the US regions helped by South Korea's inclusion in the US visa-waiver programme," the company spokesman said.
(Source:www.schednet.com)