Jin Air’s second-quarter profit falls 88 percent

1 min readUpdated May 30, 2025Aug 14, 20187:57 AM

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Jin Air, the budget affiliate of Korean Air, said Friday that its second-quarter net profit fell 88 percent from a year earlier on increased fuel costs and a decline in travel demand.

Net profit for the three months that ended on June 30 came to 1 billion won ($886,000), down from 8.1 billion won a year earlier, the company said in a regulatory filing.

Operating profit dropped 50 percent to 6.2 billion won in the second quarter from 12.5 billion won a year ago. Meanwhile, sales rose 18 percent on-year to 226.5 billion won.

The earnings results came as the South Korean government has been mulling whether to cancel the airline’s license over its illegal appointment of a foreign national to its board of directors.

Under Korean aviation law, only Koreans can be registered as the directors of an airline.

Jin Air named Cho Hyun-min – the younger daughter of Korean Air Chairman Cho Yang-ho – as its director between 2010 and 2016, even though she is legally an American citizen.

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What this means

Jin Air's substantial Q2 profit drop, while softened by an 18% sales increase, shows the severe impact of fuel costs and fluctuating travel demand on budget carriers in Asia. This downturn is exacerbated by an ongoing regulatory threat: the potential cancellation of its licence over the illegal appointment of a foreign national to its board, a direct breach of Korean aviation law. This move significantly pressures Jin Air, placing its future operations at high risk, unlike its rivals who have not faced similar licensure threats. It also differs from other market actions like Tata's 'super app' which is a proactive expansion rather than a defensive regulatory struggle. The immediate watch point is the South Korean government's forthcoming decision on the airline's licence.

Minjun Park

Questions & Answers

What were the primary reasons given for Jin Air's significant drop in net profit for the second quarter?

The company attributed the 88 percent fall in net profit to increased fuel costs and a decline in overall travel demand. These factors significantly impacted their financial performance compared to the previous year.

How much revenue did Jin Air generate in the second quarter, and how does this compare to the previous year?

Jin Air's sales for the second quarter reached 226.5 billion won. This figure represents an 18 percent increase year-on-year, showing growth despite the fall in profits.

What regulatory issue is currently facing Jin Air, and what is its potential consequence?

The South Korean government is considering cancelling Jin Air's license due to the illegal appointment of a foreign national to its board of directors. Korean aviation law stipulates that only Koreans can be registered as airline directors.

Who was the foreign national illegally appointed to Jin Air's board of directors, and during what period did this occur?

Cho Hyun-min, the younger daughter of Korean Air Chairman Cho Yang-ho, was appointed as a director between 2010 and 2016. She is legally an American citizen, which violates Korean aviation law.

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