Friday, October 24, 2014

JAL raises Hokkaido Air System stake to 51%.

On October 24th, Japan Airlines (JL/JAL) announced that they have completed the repurchase of its shares in Hokkaido Air System (HC/NTH) (unofficially calling itself HAC) which were sold to Hokkaido Government during JAL's bankruptcy reorganization. 31,500 JPY was paid per share, the same price the local government paid JAL in March 2011. JAL's shareholding in HAC increased from 14.49% to 51.23%, making it part of the JAL Group again.
Saab SF340B-WT JA02HC parked at Sapporo Airfield, more commonly called Okadama Airport. Will HAC introduce JAL's latest crane livery? (Photo: Ryosuke Yano)

Yoshiharu Ueki, President of JAL, told that the transaction was completed on October 23rd. Governor of Hokkaido Harumi Takahashi said "For HAC to maintain a safe and stable operation, it is best to fly under JAL. Subsidies are now in place, so we would like them to continue flying island routes and maintain the current network." Mr. Ueki answered "JAL will support HAC to improve its sales performance, strengthen its management competence, and maintain its network. We thank for all the support, and would like to ask for continued assistance."

From its hub at Sapporo/Okadama (OKD/RJCO), the smaller but more convenient airport near downtown, HAC currently operates to Hakodate (HKD/RJCH), Kushiro (KUH/RJCK), Misawa (MSJ/RJSM) (CoachFlyer HC330: MSJ - OKD on Hokkaido Air System's Saab SF340.), and Rishiri (RIS/RJER), plus a link to Okushiri (OIR/RJEO) from Hakodate, using a fleet of three 36-seat Saab SF340Bs. It was originally founded jointly by Japan Air System (JD/JAS) and the Hokkaido Government in September 1997 to provide high-speed public transportation between the island's major cities as well as the small remote islands.

HAC was finally starting to show positive results. For FY2013, total revenue was 2.6 billion JPY (up 21.0% from FY2012), operating profit was 34.9 million JPY (FY 2012 saw a 356.5 million JPY loss), ordinary profit was 64.5 million JPY (296.3 million JPY loss in FY2012), and net income was 138.4 million JPY, as opposed to a 296.2 million JPY loss in FY2012.

Reference: Aviation Wire, October 24th. (in Japanese)

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