Japan Airlines Corporation and Consolidated Subsidiaries Results for the Fiscal Year Ended March 31, 2007.

Tokyo, Japan, May 9, 2007 - (JCN Newswire) - Japan Airlines Corporation announced today the consolidated financial results of the JAL Group for FY2006, the fiscal year ended March 31, 2007. The announcement includes the Group's consolidated financial targets for FY2007 the year ending March 31, 2008.

Total operating revenues for FY2006, the year ended March 31, 2007, were 2,301.9 billion Japanese yen, up 4.6% on the same period last year. International passenger demand was strong, particularly in terms of first and business class demand. International passenger revenue increased by 34.6 billion yen to 724.8 billion yen, a 5.0% year-on-year improvement.

Domestic passenger demand showed signs of recovery with individual passenger sales up on last year. Compared to FY2005, domestic passenger revenue went up by 15.6 billion yen (1.6%) to a total of 675.6 billion yen. International cargo revenue was 190.5 billion yen, up 9.9 billion yen on the previous fiscal year.

Compared to the previous year, international passenger unit price increased in FY2006 by 13.1% due to an increase in high yield business demand, and the continued use of the fuel surcharge to offset the high cost of fuel. Domestic passenger unit price increased by 1.5% on the previous year, mainly due to the increase in the number of individual passengers. The unit price of international cargo also rose by 6.1% due to high yield cargo out of Japan and revisions to the fuel surcharge. As a result, JAL recorded a year-on-year operating revenue increase of 102.5 billion yen.

During FY2006, total operating costs went up by 2.3% to 2,278.9 billion yen compared to FY2005. Despite a 43.6 billion yen increase in the airline's fuel bill compared to the same period last year, steady cost reform coupled with the introduction of contingency measures, such as fuel consumption reductions, fuel surcharges, and a 10% basic wage reduction, helped to limit the overall increase in operating costs.

As a result, JAL Group posted a FY2006 operating profit of 22.9 billion yen, 49.7 billion yen up on FY2005, and an ordinary profit of 20.5 billion yen compared to an ordinary loss of 41.6 billion yen in FY2005.

JAL Group recorded a net loss of 16.2 billion yen, primarily due to the removal of 54.4 billion yen of deferred tax asset from its balance sheet, and an extraordinary loss of 6 billion yen resulting from a special early retirement program JAL launched in March 2007. This was compared to a net loss in FY2005 of 47.2 billion yen.

I. JAL Group Consolidated Results for FY06, Year Ending March 31, 2007

                                             (Japanese yen - billions)
-----------------------------------------------------------------------
                              FY06      FY06        FY05      Diff.
                            Results   Forecast*   Results   FY05/FY06
-----------------------------------------------------------------------

Total operating revenues     2,301.9   2,268.0    2,199.3     102.5
International Passenger        724.8     729.0      690.2      34.6
Domestic passenger             675.6     672.0      659.9      15.6
International cargo            190.5     189.0      180.5       9.9
Other                          710.8     678.0      668.5      42.2
Operating expenses           2,278.9   2,255.0    2,226.2      57.7
Operating income (loss)         22.9      13.0      -26.8      49.7
Ordinary income (loss)          20.5       0.5      -41.6      62.1
Net income (loss)              -16.2       3.0      -47.2      30.9

-----------------------------------------------------------------------
Figures rounded down to the nearest tenth of a billion yen.
* Announced on Feb 6, 2007

II. Summary of Air Transportation Segment Results

Operating Revenue

a) International Passenger

Against the backdrop of a business recovery in Japan, international passenger demand was strong, particularly in terms of business travelers. Passenger demand was especially strong on short and medium-haul routes, such as South Korea and Southeast Asia routes, as well as China routes on which JAL significantly increased flight frequency.

Through network restructuring by shifting to high profit routes, suspending low profit routes and aircraft downsizing, supply measured in available seat kilometers (ASK) decreased by 9.5% from the previous year. Passenger demand measured in revenue seat kilometers (RPK), however, decreased by only 7.2%. As a result, the international seat load factor (L/F) increased by 1.7 points to 71.1%.

Unit price increased by 13.1% from the previous year due to an increase in high yield business demand resulting from service improvement measures such as the expansion of the JAL Shell Flat seat onto more routes; proactive sales efforts; and the continued use of the international passenger fuel surcharge to offset the high cost of fuel. As a result, passenger revenue increased 5.0% from the previous year to 724.8 billion yen.

The number of international passengers carried by JAL Group airlines decreased by 5.1% to 13,467,241. (FY2005 total: 14,187,626).

b) Domestic Passenger

In addition to the introduction of discount fares, and the launch of seasonal promotional campaigns to stimulate demand, JAL increased the number of Class J seats - JAL's domestic business class seat - on aircraft to meet customer demand.

The number of individual passengers increased, but group passenger numbers declined slightly when compared to the previous year, a result of the effect the Aichi Expo had in boosting demand in Japan during 2005, and for example decreased demand from skiers due to poor snowfall in FY2006.

Supply measured in available seat kilometers (ASK) increased by 0.9% from the previous year, and passenger demand measured in revenue passenger kilometers (RPK) increased by 0.8%. Unit price increased by 1.5% from the previous year due to fare increases. Domestic passenger revenue increased by 2.4% from the previous year to 675.6 billion yen.

The number of domestic passengers carried by JAL Group airlines increased by 0.3% to 43,984,840. (FY2005 total: 43,848,755).

c) International Cargo

Cargo traffic from Japan to North America showed signs of recovery, and cargo traffic from Japan to the high growth market of China throughout FY2006 was strong. Cargo traffic from Europe to Japan was weak due to the effects of a high Euro. Cargo traffic from Southeast Asia dropped below last year's levels due to a reduction in supply in terms of cargo space resulting from international passenger flight route restructuring. At the same time, freighter operations were expanded to high growth markets such as China.

Measured in revenue cargo ton kilometers (RCTK), international air cargo demand decreased by 0.6% on the previous year. Due to an increase in high yield cargo traffic out of Japan and fuel surcharges, unit price rose by 6.1% and revenue increased by 5.5% from the previous year to 190.5 billion yen.

The volume of international cargo carried was 770,781 tons, down just 0.7% on the year before.

Operating Costs & Foreign Exchange

a) Fuel costs

The average market price for aircraft fuel increased from US$72.1 per barrel (Singapore Kerosene) for the previous fiscal year to US$79.7 per barrel for the fiscal year ended March 31, 2007. JAL tried to limit the full effect of increased fuel prices by conducting a wide range of measures including fuel hedging, and fuel consumption reductions. As a result, the JAL Group's FY2006 fuel bill increased by 11.6% or by 43.6 billion to a total of 420.8 billion yen.

b) Personnel costs

Personnel costs decreased by 44.1 billion yen from the previous year due to 10% basic wage reduction introduced in April 2006, and a revision to the company's pension system.

c) Foreign exchange

The average yen-to-dollar exchange rate for the fiscal year ended March 31, 2007 was 117.0 to US$1.00 compared to the previous fiscal year's average rate of 112 to US$1.00. However, the negative effect of the exchange rate on operating income was partially limited by US dollar hedging.

III. Financial Indicators

                                              (Japanese yen - billions)
-----------------------------------------------------------------------
                                   FY06          FY05          Diff.
-----------------------------------------------------------------------

Total Assets                    2,091.2       2,161.2          -70.0
Stockholders' Equity*             311.0         148.0          163.0
Capital to Asset Ratio (%)*       14.9%          6.9%      +8 points
Interest-bearing debt
on balance sheet                 1026.1       1,236.4        - 210.2
Debt/ Equity Ratio
(on balance sheet) *                3.3           8.4           -5.1

-----------------------------------------------------------------------
Figures rounded down to the nearest tenth of a billion yen.
Debt /Equity Ratio(on balance sheet)=interest bearing debts
(on balance sheet) divided by stockholders equity.
* Stockholders' Equity does not include minority stockholders' equity
due to new accounting procedures.

Total assets decreased by 70 billion yen due to the removal of 54.4 billion yen of deferred tax assets from the balance sheet, and the sale of fixed assets etc.

Interest bearing debts decreased by 210.2 billion yen from previous year due to efforts to increase asset efficiency and shrink external loans.

Equity capital increased through the public share offering in July 2006. As a result, the capital to asset ratio equity increased 8 points to 14.9%, and the debt/ equity ratio decreased to 3.3.

IV. JAL Group Consolidated FY2006 Fourth Quarter Result (Jan 1- March 31, 2007)

                                              (Japanese yen - billions)
-----------------------------------------------------------------------
                            Q4 FY06     Q4 FY05     Diff.   % Change
-----------------------------------------------------------------------

Operating revenues           567.7      530.0       37.6      107.1%
International passenger      175.5      162.0       13.5      108.4%
Domestic passenger           160.7      155.7        5.0      103.2%
International cargo           44.9       41.9        3.0      107.3%
Other                        186.4      170.3       16.0      109.4%
Operating expenses           538.9      556.0      -17.0       96.9%
Operating income (loss)       28.7      -25.9       54.7         -
Ordinary income (loss)        28.2      -30.7       59.0         -
Q4 Net income (loss)          -6.8      -24.1       7.2          -

-----------------------------------------------------------------------
Figures rounded down to the nearest tenth of a billion yen.

V. Forecasts for the Year Ending March, 2008

In FY2007, the year ending March 31 2008, operating revenue is expected to decrease by 104.9 billion yen compared to FY2006, mainly because JALUX will no longer be a JAL Group subsidiary.

JAL Group's international passenger business is expected to be strong in terms of demand, mainly due to the marked recovery of demand on China routes to which JAL Group has increased flight frequency. Service improvements, such as the introduction of a premium economy class cabin, and membership of oneworld will help to strengthen its competitiveness.

As for domestic passenger business, in FY2006 the JAL Group showed signs of recovery with increases in both passenger numbers and unit price. The company will build on this moderate growth in order to increase its market share in Japan in FY2007 by strengthening its product offering through for example the introduction of a First Class seat and by strengthening its corporate sales activities.

The Group will continue to improve profitability by cost restructuring, by implementing personnel cost, fuel cost and other cost reduction measures, and will focus its resources on its core air transport business segment in order to achieve sustainable growth.

In FY2007, JAL Group forecasts operating income of 35.0 billion yen, an improvement of 12.1 billion yen on FY2006. A net income of 7 billion yen is forecast for FY2007, an improvement of 23.2 billion on FY2006.

In this fiscal year, JAL Group will push ahead with its efforts to rebuild the business foundation of the organization by implementing the FY2007-2010 Medium Term Revival Plan - announced on February 6 2007 - in order to realize its targets of sustained growth and continuous stable profits.

Based on the above targets, JAL Group does not expect to pay a dividend for the fiscal year ending March 31, 2008.

VI. JAL Group Consolidated Traffic Statistics Full Years 2007 vs. 2006

------------------------------------------------------------------------
                                            FY ended March 31,  %Change/
                                            2007         2006    points
------------------------------------------------------------------------
International

   Passenger number                     13,467,241   14,187,626   94.9%
   Revenue passenger Kilometers (000)   62,597,923   67,434,613   92.8%
   Avaialable seat Kilometers (000)     87,987,011   97,174,777   90.5%
   Revenue seat Kilometers (000)             71.1%        69.4%   +1.7
   Revenue cargo ton Kilometers (000)    4,515,812    4,541,293   99.4%
   Mail ton Kilometers (000)               164,336      161,690  101.6%
   Revenue ton Kilomemters (000)        10,481,369   10,954,502   95.7%
   Available ton Kilometers             15,769,219   16,414,876   96.1%
   Revenue weight load factor                66.5%        66.7%   -0.2

------------------------------------------------------------------------
Domestic

   Passenger number                     43,984,840   43,848,755  100.3%
   Revenue passenger Kilometers (000)   33,187,684   32,910,535  100.8%
   Avaialable seat Kilometers (000)     51,864,339   51,415,813  100.9%
   Revenue seat Kilometers (000)             64.0%        64.0%   -0.0
   Revenue cargo ton Kilometers (000)      400,507      388,443  103.1%
   Mail ton Kilometers (000)                86,985       85,519  101.7%
   Revenue ton Kilomemters (000)         2,968,868    2,938,796  101.0%
   Available ton Kilometers              6,073,609    6,034,514  100.6%
   Revenue weight load factor                48.9%        48.7%    0.2

------------------------------------------------------------------------
Total

   Passenger number                     57,452,081   58,036,381   99.0%
   Revenue passenger Kilometers (000)   95,785,607  100,345,148   95.5%
   Avaialable seat Kilometers (000)    139,851,350  148,590,590   94.1%
   Revenue seat Kilometers (000)             68.5%        67.5%    1.0
   Revenue cargo ton Kilometers (000)    4,916,319    4,929,736   99.7%
   Mail ton Kilometers (000)               251,321      247,209  101.7%
   Revenue ton Kilomemters (000)        13,450,237   13,893,298   96.8%
   Available ton Kilometers             21,842,828   22,449,390   97.3%
   Revenue weight load factor                61.6%        61.9%   -0.3

------------------------------------------------------------------------

* International results include data from JAL International , Japan Asia Airways and JALways

* Domestic results include data from JAL International, JAL Domestic, Japan Transocean Air, JAL Express, Japan Air Commuter, Hokkaido Air System, J-Air  & Ryukyu Air Commuter.

To download JAL earnings and traffic results, please visit the Company IR website at http://www.jal.com/en/ir/index2.html .

About Japan Airlines Corporation

The JAL Group (TSE: 9205) is Japan's leading air transportation group, resulting from the integration of Japan Airlines and Japan Air System on October 2, 2002. On April 1, 2004 the Group was reorganized under a single "JAL/ Japan Airlines" brand, with Japan Airlines Domestic handling domestic passenger operations and Japan Airlines International responsible for international passenger and cargo operations. JAL International and JAL Domestic were integrated into one company in October 2006, now known as JAL International. Coordinating the group is Japan Airlines Corporation, a holding company. For more information, please visit www.jal.com.

Source: Japan Airlines Corporation

Contact:

Stephen Pearlman
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