Annual Report Japan Airlines Corporation at a Glance Consolidated Financial Highlights Consolidated Operating Highlights Message from the Management Interview with the Group CEO Dream Skyward II: Stepping-stone to become "the world' s No.1 airline group" Review of Operations Corporate Social Responsibility (CSR) Activities Management's Review and Analysis of Financial Position Consolidated Balance Sheets Consolidated Statements of Operations Consolidated Statements of Stockholder' Equity (Note8) Consolidated Statements of Cash Flows Notes to Consolidated Financial Statements Report of Independent Auditors Consolidated Subsidiaries JAL and Its Subsidiaries and Affiliates Directory JAL Group Route Network Board of Directors Investor Information

Management’s Review and Analysis of Financial Position

Outlook for Current Term

The operating environment for the JAL Group will remain harsh, but in air transportation operations, the benefits of the complete business integration will be felt to the maximum. Also, in international and domestic passenger as well as cargo operations, the Group will provide high-value-added products tailored to meet customer needs in each segment, and ongoing efforts will be made to enhance competitiveness. In addition, greater emphasis will be placed on the measures to achieve cost reductions that are already being implemented, with the aim of improving the Group’s balance of revenue and expenditure. Steps will also be taken to improve profitability in fields other than air transportation.

The latest forecasts of results for the current fiscal year are as follows, premised on an exchange rate of ¥110 against the U.S. dollar, Singapore Kerosene at a market price of US$34/barrel, and the CIF price of crude oil at US$29/barrel.

(1) Operating revenues: ¥2,190 billion

(2) Operating income: ¥81 billion

(3) Net income: ¥36 billion

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