SEOUL, May 14 (Yonhap) — Korean Air Lines Co., South Korea’s largest carrier, said Friday its first-quarter net losses narrowed from a year earlier as its increased cargo deliveries offset the pandemic-caused slump in passenger travel.
Net losses narrowed to 56.08 billion won (US$49.7 million) in the first quarter that ended on March 31 from 736.86 billion won a year ago, the company said in a statement.
“Passenger demand remains flat as countries maintain entry restrictions. Despite the challenges, Korean Air boosted passenger sales in the first quarter by operating chartered flights for repatriation and business, as well as ‘flights to nowhere,'” the statement said.
Korean Air maximized cargo operations by fully utilizing its 23 freighters, operating cargo-only passenger flights and converting jets into freighters. This helped cargo sales more than double in the first quarter compared to a year earlier, it said.
The national flag carrier said it expects air cargo demand to increase further as vaccination progresses and expectations of a global economic recovery grow.
It shifted to an operating profit of 101.58 billion won in the first quarter from an operating loss of 90.90 billion won a year ago. Sales fell 25 percent to 1.79 trillion won from 2.38 trillion won during the same period.
The carrier has suspended most of its flights on international routes since March last year as travel demand dried up amid virus fears.
The carrier has focused on winning more cargo delivery deals to offset a sharp decline in travel demand last year. Such efforts have partly paid off.
Last year, Korean Air put up its non-core assets for sale to secure operating capital and began to carry cargo in cargo seat bags, which attach to the seats of passenger jets.
The company secured 3.35 trillion won through the asset sale, a rights issue and loans. This year, it raised 3.3 trillion won in another share sale, which drove down its debt-to-equity ratio to 294 percent from 634 percent at end-2020.