Jiji Press

TOKYO (Jiji Press) — A year after its bankruptcy, Skymark Airlines, the nation’s third-largest carrier, is seeing an improvement in its operations thanks to rehabilitation efforts.

Skymark has withdrawn from unprofitable routes since it filed for bankruptcy protection with the Tokyo District Court under the civil rehabilitation law on Jan. 28, 2015. The carrier now uses only small aircraft for its services. In fiscal 2015 through March this year, Skymark’s seat occupancy rate is projected to hit the highest level since fiscal 2011.

The number of passengers on its flights rose 0.9 percent year on year to 479,000 in December 2015, logging the first growth in 14 months. In July to December last year, Skymark secured an operating profit. The company is expected to finish debt repayments to large creditors, including a major U.S. aircraft leasing firm, by the end of March and is thus steadily on course to complete its rehabilitation procedures.

Meanwhile, Skymark faces a delay in the preparations for the launch of planned code-sharing flights with bigger industry peer All Nippon Airways, a unit of ANA Holdings Inc., which supports Skymark’s business rehabilitation.

Skymark now finds it difficult to begin the joint flights in autumn this year as initially planned.

For the code-sharing flights, ANA is calling for the adoption of its flight reservation system, but Skymark has been cautious in light of management independence. Therefore, it remains to be seen when the two carriers can begin the joint flights that are believed to be an important tool for Skymark to lure customers.

“Skymark is not making haste now to start the code-sharing flights as its profitability is improving on the back of falling crude oil price,” an aviation industry official said.

Under its rehabilitation program, approved by the district court in August last year, Skymark is aiming to relist its stock within five years. The company was delisted from the Tokyo Stock Exchange on March 1, 2015, following its bankruptcy.