Korean Air Q2 net falls 18 pct on operating costs

August 2, 2023

Korean Air Co., South Korea’s leading carrier, said Wednesday its second-quarter net profit fell 18 percent from a year earlier due to increased operating costs.

Net profit for the three months ended in June fell to 371.5 billion won (US$286 million) from 450.4 billion won during the same period of last year, the company said in a statement.

Airport usage fees and aircraft operating costs jumped in line with an increased number of flights, weighing on the quarterly results, the statement said.

Operating profit plunged 36 percent to 468 billion won in the June quarter from 735.9 billion won a year ago. Sales rose 6 percent to 3.535 trillion won from 3.332 trillion won during the same period.

Sales in the passenger business division more than doubled to 2.221 trillion won in the second quarter from 874.2 billion won a year earlier as the company preemptively increased the number of flights, the statement said.

But sales in the cargo business division plunged 56 percent to 963.8 billion won from 2.171 trillion won during the cited period as air freight rates declined due to lower cargo transport demands, it said.

In the third quarter, the Korean national flag carrier expected higher passenger travel demands will give a boost to the bottom line but cargo delivery demands will remain low due to an economic slowdown.

From January to June, net income declined 27 percent to 726.89 billion won from 994.27 billion won a year earlier.

Operating profit plummeted 42 percent to 882.98 billion won in the first half from 1.524 trillion won during the same period. Sales were up 9.7 percent to 6.731 trillion won from 6.138 trillion won.

The carrier’s second-quarter results are parent-based tentative figures, not consolidated ones. Final and consolidated results are set to be released later this month.

This undated file photo offered by Korean Air shows a B787-9 passenger jet. (PHOTO NOT FOR SALE) (Yonhap)
This undated file photo offered by Korean Air shows a B787-9 passenger jet. (PHOTO NOT FOR SALE) (Yonhap)