Update 1: Japan Airlines Posts $36M Loss

Japan Airlines Corp., the nation’s biggest carrier, said Friday that it lost about $36 million for its third fiscal quarter as surging fuel prices offset revenue gains. It also placed a fresh order for 30 Boeing Co. jets, following a purchase announced late last year.

Asia’s top carrier, known as JAL, booked a group net loss of 3.72 billion yen for the October-December period, a reversal from 3.72 billion yen profit the same period the previous year. Sales rose 1.9 percent to 535.9 billion yen ($5 billion) for the quarter from 525.7 billion yen the previous year.

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Japan Airlines maintained its group profit forecast for the fiscal year ending March 31 at 23 billion yen ($220 million).

Also Friday, Japan Airlines decided to order 30 737NG jets from Boeing, a contract worth about $1.8 billion, both sides said.

The order for the 737NG, which stands for “next generation,” follows an order by Japan Airlines in December for 30 of Boeing’s new fuel-efficient jets, the 787, formerly dubbed the 7E7, due to go into service in 2008.

At a time when competition for plane orders is heating up between Boeing and European rival Airbus SAS, Japan is one nation where carriers are placing major orders with Boeing, partly because Japanese manufacturers are involved with developing and making parts for Boeing planes.

The 737NG, an improved version of the current 737 series, seats about 180 people and are billed as requiring low operational costs. Friday’s order includes an option to buy 10 more later this year, and the jets are set to be in flight next year.

Chicago-based Boeing applies the “next generation” tag to its 700, 800 and 900 versions of the 737, and Japan Airlines did not specify which mix of those models it will select. JAL said it was placing the orders for domestic flights ahead of an expansion at Tokyo’s Haneda Airport.

For the nine months ending Dec. 31, JAL earned 79.2 billion yen ($758 million) versus a loss of 53.8 billion yen for the same period in 2003. Sales for the nine months totaled 1.6 trillion yen ($15 billion), up 10 percent from 1.47 trillion yen a year earlier.

Surging oil prices hammered JAL’s earnings. Fuel costs for JAL for the nine months totaled 217.8 billion yen ($2 billion), up by 33.7 billion yen ($323 million) from a year ago.

The average price per barrel of fuel soared for the nine months to $49 from $31.50 the previous year. In the latter half of the year, it climbed to as high as $62 for a full year average price of $53, according to JAL.

International travel showed strong growth on China and Korea routes, JAL said, but domestic travel suffered because of typhoons here. International cargo traffic rose in the nine months compared to the previous year, especially to Europe, it said.