Korean Air finances boosted as it separates from troubled affiliate

Korean Air finances boosted as it separates from troubled affiliate

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Korean Air expects a continued financial improvement as it no longer has to give financial support to bankrupt affiliate Hanjin Shipping.

The projection came as the airline achieved a record operating profit for the third quarter of the year.

A spokesman said: “As Hanjin Shipping is under court receivership, [parent company] Hanjin Group will no longer provide further financial support to the company.

“Thus, Korean Air’s debt ratio will not be influenced anymore.

“We will monitor closely on the market response and will put in our best effort to improve our financial structure.”

Korean Air, Hanjin Shipping’s largest shareholder, suffered 825 billion won in losses related to the troubled container shipping business over the past nine months.

The carrier recorded a quarterly operating profit of 447.6 billion won ($395 million) for the three months to the end of September, up from 332 billion won in the same period last year.

Net profit came in at 428 billion won based on sales revenue of 3.06 trillion won.

The 447.6 billion won figure was the biggest ever quarterly operating profit, surpassing previous record of 416.5 billion won in the third quarter of 2010.

“After reflecting a total loss of 825 billion won related to Hanjin Shipping in its financial statements for the past three quarters, Korean Air has completely removed its financial risk brought by Hanjin Shipping,” the airline said.


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