Asia-Pacific carriers posted dismal results for the three months to 30 June, with losses related to exchange rates cited as a key challenge.
Six major Asia-Pacific carriers reporting earnings in the year's second calendar quarter posted a cumulative net loss of $433 million, compared with a cumulative profit of $2162 million one year earlier.
An even sharper decline was recorded in second-quarter operating profits, with the six carriers posting a loss of $118 million, compared with an operating profit of $583 million in 2012.
Overall revenue fell by 2% to $14.3 billion.
The main contributor to the cumulative loss was Korean Air, which widened its net loss to $321 million, although its operating loss was only $45 million (compared with an operating profit of $84 million a year earlier). Its Q2 earnings presentation listed foreign exchange losses of $238 million in the quarter, in addition to interest costs of $110 million.
Thai Airways also had a bad second quarter. Its net loss widened to $278 million from $49 million, and its operating loss widened to $294 million from $47 million.
The Star Alliance carrier blamed foreign exchange losses related to an appreciating baht for its poor showing. It also cited weakness in the European air cargo market.
All Nippon Airways (ANA) was another prominent loser. Unlike Thai, however, it blamed the depreciation of its home currency - the yen - for its poor showing, mainly because of higher fuel costs.
ANA's net loss was $67 million in its fiscal first quarter of 2013 to 30 June, compared with a profit of $7 million one year earlier. It also dropped into the red at an operating level, making a loss of $57 million compared with a profit of $112 million in its fiscal first quarter of 2012.
ANA's key rival, Japan Airlines (JAL), managed to remain profitable during the same three months, although profits narrowed considerably against a year earlier. In its fiscal first quarter of 2013, JAL posted a net profit of $184 million, which was well below the $271 million a year earlier. Its operating profit fell to $222 million from $316 million.
JAL says that while the Japanese domestic economy is showing signs of improvement, its earnings were hurt by the continued weakness in overseas economies.
In India, Jet Airways also had a challenging three months. It swung to a net loss of $63 million from a net profit of $4 million in the second quarter of 2012. Its operating results also showed considerable weakness, swinging to a loss of $9 million from a profit of $61 million 2012.
Jet blamed a "significant devaluation" in the Indian rupee, coupled with higher fuel prices, for its poor performance.
Singapore Airlines recorded a net profit of $110 million in the three months to 30 June.
The improvement was derived chiefly from an extraordinary gain of S$336 million ($264 million) from the sale of its 49% stake in Virgin Atlantic to Delta Air Lines.
However, this was partially offset by a restructuring impairment charge of S$293 million which arose from the sale of four Boeing 747-400 Freighters used in the Star Alliance carrier's cargo operation.
In its outlook, SIA noted that despite challenges of fuel and the poor economic outlook, forward bookings over the next few months are expected to be higher than the same period last year. However, "yields are expected to be weaker as a result of the intense competitive environment", it adds. "In this challenging operating environment, the group will continue to monitor demand trends closely and make appropriate adjustments to flight schedules and capacity, alongside a continued focus on cost discipline."