Co., Ltd.

Staying on Course— Annual Report 2007 Working to Be Asia’s Number One Airline For the Year Ended March 31, 2007 Profile

In the more than 50 years since its founding in 1952, All Nippon Airways Co., Ltd. (ANA), has provided air transportation services, with the highest priority on safe operations. ANA is proud of the high level of trust that customers have placed in the Company. As a result of that trust, ANA has grown into a world-class airline, with more than 51 million passengers a year. With an overriding emphasis on safety and customer satisfaction, the ANA Group will continue working to be the number one airline group in Asia.

Contents

1 ANA Group Corporate Philosophy Forward-Looking Statements 2 Consolidated Financial Highlights This annual report contains statements to significant fluctuations. It is possible based on ANA’s current plans, estimates, that these conditions will change dramati- 4 ANA at a Glance strategies, and beliefs; all statements cally due to a number of factors, such as 6 To Our Shareholders that are not statements of historical fact demand trends, sales prices, crude oil price are forward-looking statements. These fluctuations, the international situation, the 10 Corporate Governance statements represent the judgments and economic environment, foreign exchange hypotheses of the Company’s management rate fluctuations, and others. Due to these 12 Management Members and Group Organization based on currently available information. risks and uncertainties, it is possible that the 14 Special Feature Air transportation, the Company’s core Company’s future performance will differ business, involves government-mandated significantly from the contents of this annual Fleet Strategy: costs that are beyond the Company’s report. Accordingly, there is no assurance A Key Part of Our Mission to Become control, such as airport utilization fees and that the forward-looking statements in this fuel taxes. In addition, conditions in the annual report will prove to be accurate. Asia’s Number One Airline markets served by the Company are subject 19 Review of Operations 29 CSR (Corporate Social Responsibility) 31 Financial Section 63 The ANA Group 64 ANA Route System 65 Investor Information ANA Fact Book 2007 (separate) Please refer to the various data contained therein. ANA Group Corporate Philosophy

Our Commitments

On a foundation of security and reliability, the ANA Group will • Create attractive surroundings for customers • Continue to be a familiar presence • Offer dreams and experiences to people around the world

ANA Group Safety Principles

Safety is our promise to the public and is the foundation of our business. Safety is assured by an integrated management system and mutual respect. Safety is enhanced through individual performance and dedication. ANA Group Corporate Philosophy Corporate ANA Group

ANA Voted Airline of the Year  for 2007

Commended for Enhancing Quality and Improving Results in a Severe Operating Environment In January 2007, Air Transport World (ATW), the global aviation industry’s leading monthly magazine, voted ANA Airline of All Nippon AirwaysLtd. Co., Mineo Yamamoto, President and Chief Executive Officer the Year* for 2007. ATW cited ANA’s introduction of innovative services while maintaining safe operations and the Company’s An Airline Offering Dreams and Experiences improved operating results, achieved despite several factors to People around the World dampening air transportation demand and changes in the ANA has been providing regular international service for 21 domestic competitive environment. The ANA Group Corporate years, and it is deeply honored to receive this globally recog- Philosophy states that we conduct business on a foundation nized award. We thank all our stakeholders for their continuous of security and reliability for customers. We are delighted to support and assure them that this award will inspire us to strive receive this award as a confirmation that we are successfully even harder to become an airline that offers dreams and experi- implementing this principle. ences to people around the world.

* Air Transport World’s Airline of the Year award recognizes excellence in the airline and commercial aerospace industries. Published since 1961, Air Transport World is the leading monthly magazine in the global aviation industry, and the Airline of the Year award, started in 1974, is one of the most prestigious industry awards. Consolidated Financial Highlights All Nippon Airways Co., Ltd. and its consolidated subsidiaries1 Years ended March 31, 2007, 2006 and 2005

U.S. dollars2 Yen (Millions) (Thousands) 2007 2006 2005 2007 For the Year Operating revenues ...... ¥1,489,658 ¥1,368,792 ¥1,292,813 $12,618,873 Operating expenses ...... 1,397,468 1,279,990 1,215,039 11,837,933 Operating income ...... 92,190 88,802 77,774 780,940 EBITDA3 ...... 180,800 165,003 148,220 1,531,554 Income before income taxes and minority interests ...... 51,064 52,433 45,679 432,562 Net income ...... 32,658 26,722 26,970 276,645

Cash flows from operating activities ...... 158,714 128,525 149,070 1,344,464 Cash flows from investing activities ...... (128,298) (46,449) (169,247) (1,086,811) Cash flows from financing activities ...... (100,897) (3,137) (51,600) (854,697) Free cash flow (loss) ...... 30,416 82,076 (20,177) 257,654

At Year-End Total assets ...... ¥1,602,091 ¥1,666,843 ¥1,606,613 $13,571,292 Interest-bearing debt ...... 749,446 846,317 942,256 6,348,547 Total shareholders’ equity4 ...... 398,223 346,309 214,284 3,373,342

Yen U.S. dollars2 Per Share Data Net income ...... ¥ 16.77 ¥ 15.64 ¥ 17.26 $0.142 Net assets ...... 204.42 177.89 128.31 1.731 Cash dividends ...... 3.00 3.00 3.00 0.025

Consolidated Financial Highlights Financial Consolidated % Management Indexes  Operating income margin ...... 6.2 6.5 6.0 ROA 5 ...... 6.0 5.7 5.2 ROE 6 ...... 8.8 9.5 14.8 Equity ratio7 ...... 24.9 20.8 13.3 Debt/equity ratio (times)7 ...... 1.9 2.4 4.4

Operating Data

All Nippon AirwaysLtd. Co., Domestic passenger services: Available seat-km (millions) ...... 62,414 60,973 60,648 Revenue passenger-km (millions) ...... 40,564 39,712 38,454 Number of passengers (thousands) ...... 46,471 45,474 44,486 Load factor (%) ...... 65.0 65.1 63.4 International passenger services: Available seat-km (millions) ...... 26,607 25,338 25,190 Revenue passenger-km (millions) ...... 20,145 18,769 19,191 Number of passengers (thousands) ...... 4,552 4,135 4,116 Load factor (%) ...... 75.7 74.1 76.2 Cargo tons: Domestic (tons) ...... 457,914 440,750 422,397 International (tons) ...... 277,571 248,735 234,417

Notes: 1. As of March 31, 2007, there were 95 consolidated subsidiaries and 25 equity-method subsidiaries and affiliates. 2. U.S. dollar amounts in this report are translated, for convenience only, at the rate of ¥118.05=US$1, the approximate exchange rate as of March 30, 2007. 3. EBITDA = operating income + depreciation and amortization 4. Total shareholders’ equity = shareholders’ equity + valuation, translation adjustments and others 5. ROA = (operating income + interest and dividend income) / simple average of total assets 6. ROE = net income / simple average of total shareholders’ equity 7. Figures are calculated using total shareholders’ equity. ANA Achieves Consecutive Years of Record-High Operating Revenues and Income

• With strong passenger demand on both domestic and international routes, operating revenues rose 8.8%, to a record high of ¥1,489.6 billion.

• Price hedging and fuel management measures were used to counter higher jet fuel prices. In addition, the ANA Group’s cost structure was reformed. These initiatives helped limit the increase in operating expenses to ¥1,397.4 billion, a rise of 9.2%.

• Operating income increased 3.8%, to a record high of ¥92.1 billion.

• Net income was up 22.2%, to ¥32.6 billion.

• Cash dividends were maintained at ¥3.00 per share.

Operating Revenues Operating Income (Loss) / Net Income (Loss) EBITDA Operating Income (Loss) Margin (¥ Billions) (¥ Billions) (%) (¥ Billions) (¥ Billions) 1,600 1,489.6 100 92.1 8 40 32.6 200 180.8

75 6.2 6 1,200 20 150

50 4 Consolidated Financial Highlights Financial Consolidated 800 0 100 25 2 

400 –20 50 0 0

0 03/3 04/3 05/3 06/3 07/3 –25 03/3 04/3 05/3 06/3 07/3 – 2 –40 03/3 04/3 05/3 06/3 07/3 0 03/3 04/3 05/3 06/3 07/3 Operating Income (Loss) (¥ Billions) Operating Income (Loss) Margin (%) All Nippon AirwaysLtd. Co.,

ROA / ROE Total Shareholders’ Equity / Free Cash Flow (Loss) Interest-Bearing Debt / Equity Ratio Debt/Equity Ratio (%) (¥ Billions) (%) (¥ Billions) (¥ Billions) (Times) 30 450 30 90 1,200 12 398.2

24.9 15 8.8 60 900 9 300 20 749.4 6.0 30.4 0 30 600 6

150 10 –15 0 300 3 1.9

–30 03/3 04/3 05/3 06/3 07/3 0 03/3 04/3 05/3 06/3 07/3 0 –30 03/3 04/3 05/3 06/3 07/3 0 03/3 04/3 05/3 06/3 07/3 0 ROA ROE Shareholders' Equity (¥ Billions) Equity Ratio (%) Interest-Bearing Debt (¥ Billions) Debt/Equity Ratio (Times) ANA at a Glance

Business Activities Air Transportation • Domestic • International Passenger Operations Passenger Operations

16.2% Segment Revenues as a Percentage of Operating Revenues 72.6% 42.2%

(¥ Billions) (¥ Billions) (¥ Billions)

726.0 278.4

1,248.7

685.0 658.7 646.8 644.8

Segment Revenues 1,132.6

229.2 1,066.9 997.9 992.4 210.7 185.4 176.9

03/3 04/3 05/3 06/3 07/3 03/3 04/3 05/3 06/3 07/3 03/3 04/3 05/3 06/3 07/3

ANA and its six air transportation ANA operates 938 flights a day ANA operates 596 flights a week operators provide passenger, cargo, on 130 routes. With 46.5 million on 38 routes and carries 4.6 million and mail transportation services. passengers a year, the Company passengers a year to cities around According to IATA (International Air has a top market share of 48.4%. the world. The Company is a Transport Association) passenger In line with its key words “simple” leading member of Star Alliance, and “convenient,” ANA is work- ANA at a Glance transport statistics, the ANA Group the world’s largest airline alliance. ranks eighth among the world’s ing to improve all aspects of its In conjunction with other member  airlines. International Airport Utility service, from reservations to ticket airlines, ANA provides high-quality Co., Ltd., and ANA Aircraft Mainte- purchase, check-in, and boarding. and extremely reliable air trans- nance Co., Ltd., provide a range of portation services. The Company is services for customers at airports, focused on expanding its East Asia in addition to aircraft maintenance network, centered on China. services and airport handling ser-

All Nippon AirwaysLtd. Co., vices. These services are also pro- vided to domestic and international airlines outside the ANA Group.

Airlines by Number of Revenue Passengers in 2006 ANA Group’s Share of (Thousand passengers) Domestic Passengers in 2006 Rank Airline Number of Passengers 1 American Airlines 99,835 2 Southwest Airlines 96,277 3 Delta Air Lines 73,584 4 United Airlines 69,265 ANA 5 Northwest Airlines 55,925 JAL 48.4% 6 Lufthansa 51,213 7 Air France 49,411 8 All Nippon Airways 49,226 Others 9 International 48,911 10 China Southern Airlines 48,512 Source: IATA World Transport Statistics Sources: Ministry of Land, Infrastructure and Transport; Annual Security Reports • Cargo and Mail Operations Travel Services Hotel Operations Other Businesses

6.1% 12.1% 3.9% 11.4%

(¥ Billions) (¥ Billions) (¥ Billions) (¥ Billions)

2.7

7 9.4 8.8 105.1 208.0 196.8

6 6.7 6

190.9

199.4 9 66.6 66.3 0.9

183.3 190.2 9 177.0 173.1 2.2 8.3 8 168.6 162.8 7

03/3 04/3 05/3 06/3 07/3 03/3 04/3 05/3 06/3 07/3 03/3 04/3 05/3 06/3 07/3 03/3 04/3 05/3 06/3 07/3

ANA uses cargo freighters and ANA Sales Co., Ltd., markets airline ANA formed a joint venture with In other businesses, ANA’s opera- available cargo space on pas- tickets, mainly for ANA flights, and the InterContinental Hotels Group, tions are principally related to air senger aircraft for its cargo and develops and sells travel products the world’s largest hotel group transportation. Areas of business mail operations. With four cargo using ANA Group air transportation by number of rooms. IHG ANA include information and telecom- freighters, the Company runs 8 services and accommodations at Hotels Group Japan operates and munications, trading, retailing,

domestic flights a day on 5 routes IHG ANA Hotels Group Japan hotels. franchises 30 hotels in Japan. building maintenance, ground ANA at a Glance and 108 international flights a week The principal products are ANA * On June 1, 2007, ANA transferred its hotel transportation, and distribution. business outside the Group. ANA is now In information and telecom-  on 20 routes. ANA’s aim is to tap Hallo Tour overseas travel packages focusing on strengthening hotel operating functions. into growing demand for air cargo and ANA Sky Holiday domestic travel munications, the ANA Group transportation, especially in Asia. To packages. promotes the development that end, the Company is expand- and sales of air transport related ing its network by increasing the information terminals and software. number of cargo freighters. In distribution, the Group manages

cargo storage and deliveries, and All Nippon AirwaysLtd. Co., in trading it handles import/export of air transport related materials as well as retail and direct sales.

Volume of International Cargo Star Alliance Members (Thousand tons) 1,500 1,310 * 1,200

* 900 *

600

* Airlines due to become 300 members of Star Alliance

0 03/3 04/3 05/3 06/3 07/3 Source: Ministry of Land, Infrastructure and Transport Note: Volume of international cargo shipments carried from Japan by Japanese airlines. To Our Shareholders

Consecutive Years of Record-High Operating Revenues Let me take this opportunity to thank our shareholders and and Income investors for their continued understanding and support of our management strategy. In the fiscal year ended March 2007, ANA faced a challenging operating environment, marked by continued increases in fuel Strengthening Transportation Safety Systems and prices and the entry of a competitor airline on the – Improving Fundamental Quality of Our Operations Sapporo route. Despite this, we succeeded in securing increased numbers of high-yield passengers as international and domestic One of the ANA Group safety principles states: “Safety is our passenger demand remained firm, and we strengthened promise to the public and is the foundation of our business.” in-flight facilities and services and yield management. We also Despite our steadfast commitment to upholding this principle, implemented a fare revision and contained operating expenses recently there were two highly regrettable incidents. On through hedge transactions to stabilize fluctuations in fuel costs March 13, 2007, at Kochi Ryoma Airport, the landing gear of a as well as by reforming our cost structure. As a result, operating Bombardier DHC-8-400 malfunctioned, and the aircraft made revenues were ¥1,489.6 billion and operating income was ¥92.1 a forced emergency landing. In addition, in May 27, 2007, our billion, both consecutive record highs for the Company. We also domestic passenger system experienced net- improved our financial position by continuing to reduce interest- work problems. This caused a substantial number of delays and bearing debt. canceled flights. The ANA Group wishes to sincerely apologize to We introduced 21 new aircraft and decided on the sale of 9 its customers, shareholders, and investors. Boeing 747-400s, thus making steady progress toward achieving We take these issues with the utmost seriousness, and we are our goal of introducing highly fuel-efficient aircraft under the devoting all efforts to verifying our safety systems and prevent- ANA Group Mid-Term Corporate Strategy (April 2006 to March ing a reoccurrence. As we prepare for our next stage of growth, 2010). we will review the basics of our business and strengthen the Group’s air transportation safety systems as well as the funda- mental quality of our operations. To Our Shareholders To

 Outline of ANA Group Mid-Term Corporate Strategy (April 2006 to March 2010)

Goal To become the number one airline in Asia in all areas of quality, customer satisfaction, and value creation

Fiscal year ending March 2010 Fiscal year ending March 2010 Operating Revenues...... ¥1,550.0 billion Net Income...... ¥42.0 billion Numerical Objectives All Nippon AirwaysLtd. Co., Operating Income...... ¥100.0 billion ROA...... 6%–7% Operating Income Margin ...... 6.5% Debt/Equity Ratio...... approximately 2 times

International Passenger Operations Domestic Passenger Operations —Increase profits through an expanded network —Further increase unit revenues • Implement strategic network development • Enhance demand-supply matching • Move to South Wing, Terminal 1, Narita Airport • Increase competitiveness —Asia hub airport for Star Alliance Improve Cost Structure Key Strategies Cargo and Mail Operations —Shift to corporate constitution that is less susceptible —Expand scale of operations to strengthen foundation to economic fluctuations • Add freighters • Reduce indirect fixed costs • Expand network based on freighters —Trim by ¥10.0 billion by scal year ending March 2008 • Expand distribution tie-ups • Reduce direct costs —Trim by ¥10.0 billion by scal year ending March 2010 • Implement Fleet Strategy Mineo Yamamoto, President and Chief Executive Officer

Continued Steady Implementation of ANA Group Mid-Term Forecasts for Fiscal Year Ending March 2008(Consolidated) Yen ( Billions)

Corporate Strategy (April 2006 to March 2010) in Fiscal Year Our Shareholders To 2008 2007 Ending March 2008 March 31, (Forecast) (Actual)  Operating Revenues...... 1,490.0 1,489.6 In the fiscal year ending March 2008, we plan to steadily imple- Operating Expenses ...... 1,411.0 1,397.4 ment the ANA Group Mid-Term Corporate Strategy (April 2006 Operating Income...... 79.0 92.1 to March 2010). The operating environment is expected to Operating Income Margin (%) ...... 5.3 6.2 remain severe with continuing high fuel prices. However, with Net Income...... 64.0 32.6 transportation safety our first priority, we will remain focused Dividends (Yen)...... 5.00 3.00 on the growth areas of international passenger operations and All Nippon AirwaysLtd. Co., international cargo and mail operations as we work to build a corporate and financial structure that is resilient to changes in the business environment. Forecasts by Segment for Fiscal Year Ending March 2008 Yen ( Billions) In the fiscal year ending March 2008, air transportation 2008 2007 revenues are forecast to increase 5.1%. Taking into account the March 31, (Forecast) (Actual) transfer of the hotel business in June 2007, the forecast for con- Air Transportation Operating Revenues ...... 1,312.0 1,248.7 solidated operating revenues is ¥1,490.0 billion, approximately Operating Income ...... 72.0 79.7 the same level as in the previous fiscal year. Operating income is Travel Services Operating Revenues ...... 217.0 208.0 forecast to decrease 14.3%, to ¥79.0 billion, largely attributable Operating Income ...... 2.0 1.9 to an increase in operating expenses stemming from higher Hotel Operations Operating Revenues ...... – 66.6 fuel prices and the transfer of the hotel business. Net income is Operating Income ...... – 5.2 forecast to increase 96.0%, to ¥64 .0 billion, due to gains on the Other Businesses Operating Revenues ...... 193.0 196.8 Operating Income ...... 5.0 5.6 transfer of the hotel business offsetting a loss related to aircraft.

Note: Before intercompany eliminations ANA and the InterContinental Hotels Group will co-brand provide weekday daily services on high-demand routes to meet hotels through a hotel operating joint venture, IHG ANA Hotels customer needs. Group Japan. By transferring hotel-related shares and assets, we In July 2007, we announced our future cargo hub concept for are now close to realizing our goal of focusing management Okinawa. Taking advantage of its close position to China and the resources on air transportation operations under the ANA Group rest of Asia, we are seeking further growth in our cargo opera- Mid-Term Corporate Strategy (April 2006 to March 2010). tions.

• International Passenger Operations – Strengthening • Domestic Passenger Operations – Enhanced Measures to Tap High-Yield Business Demand Competitiveness Leads to Increased Unit Revenues Since 2004, our marketing strategy has concentrated on high- In domestic passenger operations during the year under review, yield passengers in the business class segment. In conjunction we have been pursuing a strategy of improving unit revenues* with rigorous revenue management, this initiative has resulted by matching supply to demand trends through the introduction in significant improvements in the passenger yield* and of narrow-body aircraft and raising transportation turnover while profitability. maintaining available seat-km (ASK). As a result, unit revenues In the fiscal year ending March 2008, we expect to see higher increased 3.5% during the year under review from the previous yield contributing to increased revenues as we further expand year. our route network. The increased flights that were introduced in As the expansion of Haneda Airport will result in intensified winter 2006 are now contributing to revenues throughout the competition, we intend to continue to optimize our network entire year. and enhance profitability in the fiscal year ending March 2008. To mark the 35th anniversary of the restoration of diplomatic We entered into a code-sharing agreement with Starflyer on the relations between China and Japan, we are planning several Tokyo-Kitakyushu route in June 2007. Working to meet pas- charter flights between cities in Japan and China during the senger demand, we strengthened our sales with the promotion period from August to November 2007. We are also making of the Tabi-Wari discount fare, which satisfies a wide variety of preparations for the establishment of a new route between customer needs. We also intensively promoted our SKiP service, Haneda and Shanghai Hongqiao Airport. Further, in September which we introduced in 2006, as part of our strategy to attract

To Our Shareholders To 2007 we will launch the ANA BusinessJet service (business class new customers to ANA. Further, we increased the number of only) on the Narita–Bombay route. In accordance with our policy our highly-acclaimed Super Seat Premium seats in order to offer  of matching aircraft supply to demand trends, we will introduce customers high-quality services clearly differentiated from our the highly fuel-efficient Boeing 777-300ER on the Narita–London competitors. and Narita–San Francisco routes, thus targeting even higher * Unit revenues = passenger operating revenues / available seat-km (ASK) profitability. * Passenger yield = passenger operating revenues / revenue passenger-km (RPK) Stepped-up Introduction of Fuel-Efficient, Wide-Body Aircraft

All Nippon AirwaysLtd. Co., • Cargo and Mail Operations – Reinforcing Business through Route Network Expansion With a long-term prospect of high fuel prices, we are promot- In the fiscal year ended March 2007, growth was sluggish in the ing the introduction of new highly economical, fuel-efficient international air cargo market. However, we continued to expand aircraft. This is an acceleration of our Fleet Strategy, implemented our route network, introducing our fourth cargo freighter and from the fiscal year ended March 2004. In the fiscal year ended starting the Centrair–Chicago route. As a result, international March 2007, we decided on the sale of nine Boeing 747-400s cargo revenues increased 12.3% from the previous fiscal year. and placed additional orders for four Boeing 777-300ERs. We Total cargo and mail revenues were up 8.7% year on year, to are focusing on the stepped-up introduction of the wide-body ¥105.1 billion, the first time they have exceeded the ¥100 billion Boeing 777-300ER, which has particularly high fuel efficiency on level. long-haul routes. In these ways, we are enhancing profitability in In the fiscal year ending March 2008, we will consign cargo preparation for the completion of the Haneda Airport expansion operations to ABX Air, Inc., of the United States, and will effec- project. tively have six freighters at our disposal. Through measures We are also making intensive preparations for the May 2008 like these, our focus will continue to be network expansion on introduction of the new medium-sized Boeing 787, which will be Asia (centered on China)–Japan/North America routes. We will a key aircraft in the ANA Group’s ongoing Fleet Strategy. Strengthening Safety Measures

Progress in Improving Financial Position and Planned Dividend Increase • Safety Measures for Bombardier Aircraft On March 13, 2007, an ANA Bombardier DHC-8-400 was The transfer of the hotel business yielded proceeds of ¥281.3 forced to land at Kochi Ryoma Airport without deploying billion, a figure in excess of our original projections. We will use its nose landing gear. After this, based on a technical these funds to improve the competitiveness of our air trans- circular directive issued by Japan’s Civil Aviation Bureau, portation operations and to strengthen our financial position. an emergency inspection was carried out on the nose At the end of the fiscal year ending March 2008, we project a landing gear of all of ANA’s Bombardier aircraft. As an debt/equity ratio* of about 2 times, very close to the target set additional precautionary measure, daily visual and opera- in the ANA Group Mid-Term Corporate Strategy (April 2006 to tional checks were made on the operation of the housing March 2010). Therefore, our efforts to improve the balance sheet door for both the nose and main landing gear as well as in recent years will have achieved a measure of success. the bolts on the mechanism of the nose landing gear. To ANA gives a high priority to providing a return to shareholders, further confirm the safety of the aircraft, certain key items and, on the assumption that ANA meets its forecasts in the cur- from ANA’s heavy maintenance check (key components rent fiscal year, the Company plans to raise the annual dividend related to landing gear and control devices) were subject from ¥3.00 per share to ¥5.00 per share for the fiscal year ending to special inspection on all Bombardier aircraft. March 2008. Further, Bombardier Inc.’s top management expressed * Includes off-balance lease obligations its desire to strengthen the company’s engineering support systems in Japan such that a meeting was Becoming Asia’s Number One Airline, Targeting convened between representatives from Japanese Expansion of Haneda Airport and Beyond airlines and Bombardier engineering specialists, and a supply base will be established at Narita Airport. Also, Work has begun on the construction of the fourth runway at with the support of a Bombardier engineering team, Haneda Airport, due for completion in October 2010. The Japa- the aircraft that displayed the malfunction has been nese government has outlined Japan’s Asian Gateway Initiative, thoroughly inspected and repaired. We are devoting which has prompted lively debate on the positioning of Haneda our best efforts to ensuring safety. Our Shareholders To Airport in terms of internationalization and further deregulation. Japan’s aviation industry is clearly moving toward a big bang  • Establishment of ANA Group with the completion of the Haneda Airport expansion. Moreover, the trend in the global aviation industry is toward liberalization. Safety Education Center To succeed in this environment, the ANA Group aims to become On January 1, 2007, the ANA Group established the the airline that truly represents Asia, delivering on quality, cus- Safety Education Center. The center allows ANA Group tomer satisfaction, and value creation. employees to draw lessons from past aviation accidents

The ANA Group Mid-Term Corporate Strategy (April 2006 and incidents, to raise their awareness about the All Nippon AirwaysLtd. Co., to March 2010) is on track. We will continue in our efforts to importance of air transportation safety, and to consider increase profitability and achieve our target of ¥100.0 billion in methods to achieve the safest level of transportation operating income in the fiscal year ending March 2010. possible. Training programs for Group employees began in February. July 2007

Mineo Yamamoto President and Chief Executive Officer

ANA Group Safety Education Center Corporate Governance

Fundamental Approach to Corporate Governance Internal Control System and Risk Management System

ANA believes that it is essential to institute a system of corporate governance that promotes operational Board of Directors (management) transparency and accountability to President & CEO stakeholders in order to continue enhancing ANA’s Internal Control System enterprise value.

Internal Audit Risk Management Committee Compliance Committee Implementation of Corporate Governance Division Initiatives Risk Management Subcommittee ANA’s Corporate Governance Status, Including Organizational Structure for Decision Making, Air Transportation Execution, and Management Oversight Safety / Crisis Management Information Security • Governing Bodies of the Company Subcommittee ANA’s management system comprises 16 directors, 5 Chief Risk Management O cer Chief Compliance O cer (Executive Vice President, (Executive Vice President, corporate auditors, and 35 corporate executive officers CSR Promotion) CSR Promotion) (including those who are both directors and corporate Risk Management & Compliance Risk Management & Compliance executive officers). For important administrative issues, (Executive O ce) (Executive O ce) discussions are held and decisions are made by the Management Committee, which is chaired by the Risk Management Leaders Compliance Leaders president and includes the 13 directors who are also Risk Management System corporate executive officers, 2 corporate auditors, and other corporate executive officers. Under the Corpora- tion Law of Japan, certain issues must be considered by the board of directors, which makes the final decision on such on Company offices or Group companies, with approximately issues. 180 subjects being audited once every three years. Information The board of directors is led by the chairman. In addition to the on important issues that emerge from the audits is reported to directors, 2 of whom are external directors, the board includes the independent auditors via the Finance & Accounting Division. 5 auditors, 3 of whom are external auditors. The board of direc- Auditing results are reported to the president each month, and tors met 13 times in the fiscal year ended March 2007, including important items are reported to the corporate auditors quarterly. Corporate Governance Corporate extraordinary meetings. Audits by corporate auditors are performed by the five corpo- rate auditors. Each corporate auditor conducts audits of operations 10 • Enhancement of Internal Control System at each office and audits of subsidiaries and reports the results to and Risk Management System the board of corporate auditors and to the representative direc- In April 2003, ANA founded its internal control system, which tors. The auditors share information and opinions with the Internal comprises the Risk Management Committee, the Compliance Audit Division and the independent auditors on a quarterly basis Committee, and the Internal Audit Division. In addition, the and work to enhance auditing. Finance & Accounting Division is considering the establishment As for account auditing, Ernst & Young ShinNihon audited the of an internal control system for financial disclosure in accordance Company, its work sites, and Group companies in accordance with

All Nippon AirwaysLtd. Co., with the Financial Product Trading Law. the Corporation Law and the Securities and Exchange Law of The Risk Management Section of the CSR Promotion Division, Japan. Auditing results were reported to ANA’s management and which was established in April 2007, has been assigned as the to the board of corporate auditors. Risk Management Committee’s secretariat. The Risk Management Committee works with Risk Management Leaders assigned to Independent Auditors Engaged in Audits major departments and affiliated companies to facilitate risk Name of Accountant Name of Audit Corporation management activities. Risk Management Leaders, who are also Kazuo Tanimura Compliance Leaders and Information Security Leaders, act as Engagement Partner Ernst & Young ShinNihon promulgators of risk management. The Risk Management Commit- Masatsugu Hamada tee has also established subcommittees with expertise in specific Mitsuo Cho risks, such as the Air Transportation Safety / Crisis Management Notes: 1. All the independent auditors have less than seven continuous auditing years. Therefore, figures for continuous auditing years have been omitted. Subcommittee and the Information Security Subcommittee. In 2. The independent auditors have voluntarily adopted a system whereby their executive addition, in the event of the occurrence of certain risks, temporary officers cease from ANA account auditing after a specified period. subcommittees will be formed to take action in a cross-sectional manner. There are eight Certified Public Accountants, five Junior Accoun- tants, and one other staff member assisting with audit services. • Internal Audits, Audits by Corporate Auditors, and Account Audits Personal Relationships, Business Relationships, and Other Internal audits are performed by the Internal Audit Division, which Interests between the Company and External Directors carries out operational audits and accounting audits for ANA and or Auditors Group companies. Each year, more than 60 audits are performed The Company has two external directors: Mr. Misao Kimura and Mr. Shosuke Mori. Nagoya Railroad Co., Ltd., where Mr. Kimura serves coordinate CSR activities throughout the entire ANA Group. as chairman and representative director, is the largest shareholder Internal control, environment-related, and social responsibility of ANA, holding 3.69% of the total issued stock. In addition, ANA functions are now integrated within the CSR Promotion Division. and Nagoya Railroad Co., Ltd., have dealings concerning the Headed by the executive responsible for CSR, the division will consignment of flight ticket sales business. There is no particular work to strengthen the Company’s CSR system. business relationship between ANA and the Kansai Electric Power Co., Inc., where Mr. Mori serves as president and representative director. In the fiscal year ended March 2007, the Internal Audit Division The three external auditors are Mr. Kunitaka Kajita (standing implemented audits at approximately 70 offices and Group corporate auditor), Mr. Shingo Matsuo, and Mr. Hideo Minamiyama. companies. Areas covered in the audits included accounting There are no particular business relationships between ANA and practices, quality control systems, compliance with regulations, Mr. Kajita, Mr. Matsuo, or Mr. Minamiyama or between ANA and and the protection of personal information. Kyushu Electric Power Co., Inc., where Mr. Matsuo serves as presi- dent and representative director, or Hokkaido Electric Power Co., Limited Liability Agreements Inc., where Mr. Minamiyama serves as chairman and representative ANA has entered into agreements with external directors and directors. external auditors whereby their liability for actions set forth in Article 423, paragraph 1 of the Corporation Law is limited to the Corporate Governance Activities in the Fiscal Year amount provided for in Article 427, paragraph 1 of the Corporation Ended March 2007 Law. • Advisory Board In order to hear frank and open opinions and advice about the Number of Directors Group’s management, ANA has established the Advisory Board, The Company’s Articles of Incorporation stipulate that ANA shall which consists of seven members with a range of backgrounds. have no more than 20 directors. The board met four times during the fiscal year ended March 2007. Requirements for Election of Directors • Enhancing the Internal Control System The Company’s Articles of Incorporation stipulate that directors In the fiscal year under review, ANA made the following efforts to shall be elected by the majority voting rights of a meeting of reinforce its internal control system, which is an important part of shareholders, where the shareholders present at the meeting are the infrastructure supporting effective corporate governance. holding one-third or more of the voting rights of all shareholders.

Special Resolutions at General Meeting of Shareholders Corporate Governance Corporate We worked to reinforce the effectiveness of our operational con- With regard to the passing of special resolutions at the General tinuance plan, which was formulated in response to the risk of a Meeting of Shareholders, as stipulated in Article 309 of the 11 large earthquake in the Kanto region, where our management Corporation Law, the Company’s Articles of Incorporation were resources are concentrated, or a Tokai earthquake. In particular, amended to state that the presence of shareholders representing we formulated individual operational continuance plans at each not less than one-third of voting rights is required for a quorum, department level. and the affirmative votes of two-thirds of the voting rights present Also, we strengthened the efficiency of our safety confirma- are required to pass the special resolution. By relaxing the quorum tion system by conducting Companywide operational training requirements for a special resolution, ANA aims to promote sessions. In information security, we trained employees using smoother management of the General Meeting of Shareholders.

e-learning and reinforced our information security systems, All Nippon AirwaysLtd. Co., including those for the protection of individual customer Board Members’ Remuneration and Audit Fees information. in the Fiscal Year Ended March 2007

Board Members’ Remuneration We adopted a policy of reexamining our compliance function. ANA paid the following remuneration to directors and auditors.

Under this policy, we evaluated the extent to which compli- Remuneration paid to directors...... ¥420 million ance penetrates the Company and worked to strengthen it. In (of which ¥6 million paid to external directors) addition, we increased the number of compliance leaders and Remuneration paid to auditors...... ¥81 million appointed sub-leaders. In accordance with the provisions of (of which ¥33 million paid to external auditors) the Whistleblower Protection Act of April 2006, we established Total...... ¥501 million regulations concerning the handling of internal reporting and disseminated them throughout the ANA Group and to our Audit Fees business partners. We rigorously enforced codes of conduct ANA paid the following fees to Ernst & Young ShinNihon. for temporary workers, improved our systems for security trade control, appropriately adjusted our contract and temporary work Fees in accordance with services described systems, and strictly managed working hours. in Clause 1, Article 2 of the Certified Public Accountant Law...... ¥59 million Fees based on services other than above. . . ¥62 million Total...... ¥122 million The CSR Promotion Division was established in April 2007 to * The above audit fees include the audit fees described in the Corporation Law of Japan and the Securities and Exchange Law of Japan. Management Members and Group Organization (As of June 25, 2007)

Front row, from left, K. Kubo, Y. Ohashi, M. Yamamoto, S. Omae, and S. Ito Back row, from left, K. Okada, M. Morimoto, S. Nagase, T. Hidema, and A. Nomoto

Management Organization Members and Group Board of Directors Corporate Auditors

12 Yoji Ohashi Shin Nagase Hiroyuki Ito Kunitaka Kajita Chairman of the Board Executive Vice President Executive Vice President Corporate Auditor General Administration, Public Relations, Engineering & Maintenance Mineo Yamamoto CSR Promotion, Koichiro Ono President & Chief Executive Officer Chairman of CSR Promotion Committee, Junko Yamauchi Corporate Auditor Chairman of the Management Committee, Chairman of Environment Committee, Executive Vice President Chief of Safety Promotion Committee, Chairman of Risk Management Committee, Inflight Services Koji Ohno Chairman of Compliance Committee Chief of Risk Management Committee, Corporate Auditor

All Nippon AirwaysLtd. Co., Osamu Shinobe Mitsuo Morimoto Suguru Omae Executive Vice President Shingo Matsuo Executive Vice President Senior Executive Vice President Corporate Planning, B787 Launch Project External Corporate Auditor Flight Operations Operations & Airport Services, President and Representative Director Corporate Safety and Audit, Katsumi Nakamura of Kyushu Electric Power Co., Inc. Chairman of Safety Promotion Committee Tomohiro Hidema Executive Vice President Executive Vice President Operations & Airport Services, Hideo Minamiyama Investor Relations, Group Business Koshichiro Kubo Chairman of Operations Committee External Corporate Auditor Development, Finance & Accounting, Senior Executive Vice President Chairman and Representative Director Purchasing, Facilities Executive Office, Personnel, Misao Kimura of Hokkaido Electric Power Co., Inc. Human Resource University Preparatory External Director Office, Employee Relations, Keisuke Okada Chairman and Representative Director Business Support Executive Vice President of Nagoya Railroad Co., Ltd. International & Regulatory Affairs, Shinichiro Ito Alliance & International Affairs, Shosuke Mori Information Technology Services, Senior Executive Vice President External Director Chairman of Information Technology Marketing & Sales, CS Promotion, President and Representative Director Strategy Chairman of CS Promotion Committee of the Kansai Electric Power Co., Inc. Akinori Nomoto Executive Vice President Cargo Marketing & Services Corporate Executive Officers

Minoru Aimono Kunio Yamazaki Mitsuhiko Ota Eiji Kanazawa Senior Vice President Senior Vice President Senior Vice President Senior Vice President Sales, President of ANA Sales Co., Ltd. General Manager, China General Manager, Tokyo Airport Finance & Accounting

Katsuyori Kikuchi Yusuke Jikumaru Toru Sato Ken Nishimura Senior Vice President Senior Vice President Senior Vice President Senior Vice President General Manager, Tokyo Sales Office Flight Operations Information Technology Services General Manager, Sales Office

Shinsuke Maki Shigeyuki Takemura Yoshinori Maruyama Katsumi Kobayashi Senior Vice President Senior Vice President Senior Vice President Senior Vice President Engineering & Maintenance Goverment & Industrial Affairs General Manager, Fukuoka Sales Office General Manager, Narita Airport

Osamu Asakawa Akihiko Nakamura Kiyoshi Tonomoto Shinya Katanozaka Senior Vice President Senior Vice President Senior Vice President Senior Vice President President of Co., Ltd. Marketing & Sales Cargo Marketing & Services Personnel

Atsuro Takahashi Tsukasa Shibata Motomu Iwaya Akira Okada Senior Vice President Senior Vice President Senior Vice President Senior Vice President General Manager, Sapporo Sales Office General Manager, Nagoya Sales Office Operations & Airport Services, Corporate Planning Operations Development Shinichi Inoue Kenji Maruyama Senior Vice President Senior Vice President Yasuo Goto Flight Operations General Manager, Osaka Airport Senior Vice President CSR Promotion

ANA Group Organization

ANA Gen. Mtg. of Stockholders Management Committee Corporate Auditors Corporate Auditors Office Operations Committee Management Organization Members and Group Board of Corporate Auditors Board of Directors CS Promotion Committee 13 CSR Promotion Committee Chairman Internal Audit President & CEO Safety Promotion Committee Senior Executive Vice President Environment Committee

IT Strategy & Governance Committee

Risk Management Committee All Nippon AirwaysLtd. Co., Compliance Committee Headquarters Department

Operations & Airport Services

Marketing & Sales Cargo Marketing & Services Flight Operations Engineering & Maintenance Inflight Services

Domestic Branches Domestic Airport Branches Overseas Branches Domestic Airport Offices Overseas Airport Offices

ANA GROUP Air Transportation: Transportation Related Air Transportation: Transportation Support Related Travel Services Hotel Operations Other Businesses Subsidiaries: 128 Air Nippon Co., Ltd. International Airport Utility Co., Ltd. ANA Sales Co., Ltd. ANA Hotel Tokyo Co., Ltd. All Nippon Airways Trading Co., Ltd. Affiliates: 44 Air Nippon Network Co., Ltd. ANA Catering Service Co., Ltd. Okinawa ANA Resort Co., Ltd. ANA Information Systems Planning Co., Ltd. New Tokyo Airport Service Co., Ltd. Co., Ltd. Co., Ltd. ANA Aircraft Maintenance Co., Ltd. Sky Building Service Co., Ltd. Co., Ltd. ANA Logistic Service Co., Ltd. ANA & JP Express Co., Ltd. ANA Business Create Co., Ltd.

(As of March 31, 2007)

Note: ANA transferred its hotel business outside the Group in June 2007. Special Feature

Fleet Strategy: A Key Part of Our Mission to Become Asia’s Number One Airline

n air transportation operations, the most important role is Fleet Upgrade Strategy Iplayed by the aircraft that make up the airline’s fleet. The ANA Group’s fleet currently comprises 112 aircraft. To succeed in a tough competitive environment, we are implementing Downgauging the earliest possible renewal of aircraft that will excel in terms of safety, fuel efficiency, economy, and comfort. The Company’s Fleet Strategy is therefore a crucial component Switching to Fuel-Saving Fleets of the ANA Group Mid-Term Corporate Strategy (April 2006 to March 2010), which aims to make ANA Asia’s number one airline. Integrating (Cost Savings, Improved E ciency)

ANA’s Fleet Strategy – Providing the Base for Heightened Competitiveness ANA has a very wide route network that ranges from short • Aircraft Selection – Most Important Management Decision domestic routes to long-haul international routes, and this makes Aircraft can be in service for more than 10 years and are thus a it difficult for one aircraft type to fulfill all the requirements. Each vital asset for airlines. The manufacturer catalog prices of aircraft aircraft type has individual performance characteristics. Based on can run from about 30 million dollars to about 300 million our projections of future route development and the business dollars. In selecting aircraft and determining fleet composition, environment, we pursue the optimal fleet composition.

Special Feature an airline is making decisions that can significantly influence its future. • ANA Establishes Three-Principle Strategy 14 The selection of aircraft is a highly complex process, depen- for Airport Expansion dent on many factors. First, a number of external requirements ANA is implementing its Fleet Strategy in line with the two come into play based on the mid-term network strategy: aircraft major airport expansion projects under way at Haneda Airport fuel efficiency and flight performance; airport conditions, such and Narita Airport. These projects will change the market, and as runway length and flight support facilities; and environmental ANA intends to link this to an opportunity for growth. The Fleet considerations, including noise control. Second, the selection Strategy has three principles: downgauging, switching to fuel-

All Nippon AirwaysLtd. Co., process must take into account internal factors: personnel and saving fleets, and integrating. As the number of landing and training plans for flight crews, cabin attendants, and engineers; departure slots expands, we will increase the number of aircraft maintenance and training facility plans; and supply plans for equipment and components, Fleet Upgrade Plan including engines. In addition, a comfortable cabin environment, which motivates passengers Total of 211 aircraft DHC, etc. DHC, F50 to choose ANA regularly as their airline, is also a Regional DHC, F50 key consideration. A320-200 A320-200 B737-700, etc. Narrow-Body B737-400/500 B737-400/500 B737-700 B737-700

B767-300/ER B787-8 Medium-Sized A321-100 B767-300/ER B787-8/3, etc. B767F B767F

B747-400 B747-400 Wide-Body B777-300/ER B777-300/ER B777, etc. B777-200/ER B777-200/ER 2007/03 2009 2015 Aircraft Prices

Aircraft Price ( $ Millions )

B777-300/-300ER ...... 210.0 – 264.5 B777-200/-200ER ...... 178.0 – 212.5 B747-400/ -400D...... 216.0 – 247.5 B787-8 ...... 148.0 – 157.5 B787-3 ...... 138.0 – 143.0 B767-300 Freighter ...... 143.0 – 155.0 B767-300ER ...... 133.0 – 149.0 A321 ...... 80.0 – 85.0 A320 ...... 65.0 – 70.0 B737-700...... 54.0 – 64.0 DHC-8-400 ...... 25.0 – 30.0

Source: Catalogue Price Lists from Manufactures while boosting the ratio of smaller aircraft. At the same time, • Enhanced Competitiveness from Smaller Aircraft we will introduce new fuel-efficient aircraft. Jet aircraft will be and Higher Flight Frequencies standardized to three types – one each of wide-body, medium- With the expansion of Haneda and Narita airports, the number sized, and narrow-body. These three principles will strengthen of landing and departure slots will increase, and airlines will have our cost competitiveness and create an operational base resilient an opportunity to increase flight frequencies. The introduction to changes in the business environment, such as sudden fluctua- of smaller aircraft enables airlines to enhance competitiveness tions in demand. by creating greater convenience due to increased flights while Special Feature guarding against a lowering of the load factor, which comes 15 from operational expansion. In addition, flight operations can be

Characteristics of Aircraft — Aircraft Size and Flight Range

B777-300 B777-300ER Wide- Body B777-200 B777-200ER B747-400D B747-400 All Nippon AirwaysLtd. Co.,

B787-3 B787-8 Medium- Sized B767-300 B767-300ER A321

A320-200 A320-200i Narrow- B737-700 B737-700ER Body B737-500 B737-400

F50 Prop Aircraft DHC-8-400 DHC-8-300 Dedicated Aircraft for International Routes 0 500 1,000 2,000 3,000 4,000 5,000 10,000 15,000

Osaka–Fukuoka Narita–Incheon Haneda–Okinawa Narita–Beijing Narita–Bangkok Narita–Singapore Narita–New York Osaka–Niigata Haneda–Sapporo Narita–Seoul Narita–Hong Kong Narita–Ho Chi Minh City Narita–Bombay Narita–Washington, D.C. Sapporo–Hakodate Haneda–Fukuoka Narita–Shanghai Narita–Taipei Narita–San Francisco Narita–Chicago Sapporo–Memanbetsu Haneda–Okayama Kansai–Guam Narita–Los Angeles Narita–London Nagoya–Fukushima Haneda–Hiroshima Narita–Paris Nagoya–Yonago Narita–Frankfurt

Flight Range (km) adjusted flexibly to demand and can respond precisely to differ- ANA is standardizing its jet aircraft to three types – one each of ent levels of demand at different times. ANA will steadily increase wide-body, medium-sized, and narrow-body. By narrowing our the ratio of medium-sized and narrow-body aircraft and thereby focus to these three types, we can enhance the effectiveness heighten its competitiveness against rival airlines and other of training and allocation for flight crews and engineers as well forms of transportation, such as the Shinkansen bullet train. as eliminate waste. Equipment and aircraft parts inventory can also be optimized, helping to decrease costs. Through holding • Fuel-Efficient Aircraft to Counter Rise in Fuel Costs substantial numbers of aircraft within a limited range of types, The Fleet Strategy’s introduction of cutting-edge new aircraft ANA will enjoy scale merits and reduced operating costs. offers the prospect of an improvement in fuel efficiency, and we expect reductions of between 12% and 18% in fuel consumption Introducing Environment-Friendly Aircraft per seat on standard domestic routes. When the Boeing 747-400 was replaced by the Boeing • Controlling CO2 Emissions and Decreasing Noise 777-300ER on the Narita–New York route in May 2005, fuel Airlines are dependent on fossil fuel for their operations, and the consumption decreased 24% per flight. In addition, our FAM (Fleet consequent emissions of CO2 place a considerable burden on Assignment Model) assists in allocating the appropriate size of the global environment. Environmental performance has been aircraft in accordance with demand on each route. This results an important factor for in an optimal allocation of aircraft to meet demand, leading to ANA when selecting reduced fuel consumption and lower landing and navigation new aircraft, as was the fees at airports. case with the Boeing

Special Feature 787. Reducing the envi- • Pursuing Efficiency through Limited Number ronmental impact of 16 of Aircraft Types our business activities In order to expand our network to meet demand trends, continues to be one we need to maintain a certain number of aircraft types, of our most important differentiated by capacity, cruising range, and other factors. management priorities.

Lighter economy seats on domestic routes All Nippon AirwaysLtd. Co.,

Fuel Consumption per Seat by Aircraft Type

(%) Wide-Body1 Wide-Body2 Medium-Sized2 Narrow-Body2 (%) Increasing B777-300ER Retiring B747SR, Increasing B777 Introducing B787 from 2008 Introducing B737-700 in stages 120 120 24% 12% 18% 12% down 114 down down down 100 100 100 100 100 100 88 88 80 82 80 76 60 60

40 40

20 20

0 0 B747-400 B777-300ER B747SR B747-400 B777-300 B767-300 B787 B737-500 B737-700 (Current Fleet) (Current Fleet) (Current Fleet) (Current Fleet)

Notes: 1. Figures are based on Narita–New York route. 2. Figures are based on Tokyo–Sapporo route, domestic-use aircraft with full capacity. Fleet Strategy: A Key Part of Our Mission to Become Asia’s Number One Airline

The ANA Group Ecology Plan calls for the reduction of CO2 emissions per available seat-kilometer (ASK) in the fiscal year ending March 2008 by 12% from the level in the fiscal year ended March 1991. In the fiscal year ended March 2007, we introduced new environment-friendly aircraft, such as the Boe- ing 777, and took steps to reduce the weight of equipment on aircraft servicing domestic routes, including the introduction of lighter economy seats and lighter cargo containers. We give the same priority to noise reduction and are taking initiatives in this area as well. Since April 2006, all ANA aircraft in operation have cleared the toughest ICAO (International Civil Aviation Organization) noise standard, the Chapter 4 standard.

CLUB ANA BJ Enhanced Quality Leading to Stronger Competitiveness business class services, such as New Style, CLUB ANA. Among other initiatives, we launched the ANA BusinessJet • Fresh Initiatives with New Aircraft service on the Centrair–Guangzhou route in the fiscal year ended In conjunction with the Fleet Strategy, ANA is focusing on the March 2007. A Boeing 737-700ER is servicing this route, equipped creation of a more comfortable cabin environment and in-flight with 24 business class seats (CLUB ANA BJ) and 24 economy class facilities that meet customer needs. seats (Economy BJ). With 155cm pitch between business class Special Feature On domestic routes, we have enhanced Super Seat Premium seats, passengers can enjoy an expansive seat layout. Further- 17 services to secure high-yield passengers, while on international more, an all-business-class, 36-seat ANA BusinessJet service will routes we have renewed our first class services and expanded be introduced on the Narita–Bombay route in September 2007. All Nippon AirwaysLtd. Co.,

ANA BusinessJet Fleet Strategy: A Key Part of Our Mission to Become Asia’s Number One Airline

Preparing for Boeing 787 Introduction • ANA Involved from Development Stage, Preparations Proceeding Smoothly • 20% Reduction in Fuel Consumption In 2004, ANA became the “launch customer” for the Boeing 787, The Boeing 787 is an aircraft that excels in terms of reliability, the first airline to place an order for the aircraft. We became comfort, and economical operation. In 2004, ANA placed an actively involved order for 50 Boeing 787 aircraft, positioning it as the successor from the develop- to the Boeing 767. In 2008, ANA will be the first airline in the ment stage to make world to bring the Boeing 787 into service. The Boeing 787’s fuel sure that the new consumption is about 20% less than the Boeing 767, generating aircraft would reflect high expectations for lower flight costs and CO2 emissions. It our experience as uses the latest Rolls-Royce Trent 1000 engine, which is noted for an airline and would its high fuel efficiency and low noise. Further, the Boeing 787’s also meet passenger

body uses carbon fiber composite materials that are nine times needs. We are ensur- Flight deck of the Boeing 787 ©Boeing stronger and about half the weight of the equivalent amount of ing that the aircraft’s materials currently used. Therefore, not only a lighter body but body design is appropriate for high-frequency, short-distance also lower maintenance costs are expected. flights. We are also working to confirm the aircraft’s reliability by addressing certain problems that are unique to flight in Japan, Boeing 787 Features such as in-flight condensation and winter lightning.

Special Feature The Boeing 787 cockpit Improved Flight Efficiency and Safety Carbon Fiber Composite Materials Widely Used is standardized with that of 18 • Electronic Flight Bag (EFB) installed, allowing reading of electronic • Approximate 50% weight reduction allows lighter flight manual and display of aircraft position while over airports. aircraft body and reduced maintenance costs. the Boeing 777 in order to • Two Head Up Displays (HUDs) installed. • If compared with equivalent weight of steel, carbon shorten the transition training • Vertical Situation Display (VSD) installed. fiber composite materials are 9 times stronger. schedule for flight crews. We • Electronic checklist. are also cooperating with the engine maker, Rolls-Royce, on development.

All Nippon AirwaysLtd. Co., Moreover, for the introduc- tion of the Boeing 787, ANA established the B787 Launch Project in all key operational divisions, including the Flight Operations Division, the Enhanced Comfort in the Passenger Cabin Engineering & Maintenance • Compared with existing aircraft, internal cabin pressure Division, and the Inflight can be brought closer to ground level pressure. 20% Reduction in Fuel Consumption Compared with Boeing 767 Services Division. Preparations • Windows 8cm higher than the 39cm Boeing 767 • New engine enhances fuel efficiency and reduces noise. windows, allowing more light and fine views. • System to prevent compressed air used in main wing defrosting for a safe, smooth introduction • Higher humidity levels can be maintained compared and other electrical systems from escaping into various parts of are proceeding well. with existing aircraft. the aircraft body. Review of Operations Air Transportation

The ANA Group’s operations comprise four segments: air trans- Air Transportation portation, travel services, hotel operations, and other businesses, Highlights such as information and telecommunications and trading and Figures in parentheses show change from previous fiscal year. retailing. Air transportation revenues. . . ¥1,248.7 billion (+10.3%) We continue to strive to ensure safe operations and to enhance Operating expenses...... ¥1,169.0 billion (+10.4%) the fundamental quality of our air transportation services as well Operating income...... ¥79.7 billion (+7.6%) as to improve the profitability of ROA ...... 5.5% (+0.2 percentage points) Operating Revenues by Segment each segment, thereby enhanc- ROA: operating income / simple average of assets ing the trust placed in us by Hotel Operations 3.9% customers and shareholders. The air transportation segment accounted for 72.6% of total operating Other Businesses revenues before eliminations. In this section, we give an over- 11.4% view of the performance of each Overview of fiscal year ended March 2007 business segment in the fiscal Air Transportation 72.6% year ended March 31, 2007. Record-High Operating Revenues and Income * ANA transferred its hotel business outside Air transportation demand remained solid throughout the fiscal the Group in June 2007. Travel Services year under review, supported mainly by business demand deriv- 12.1% ing from Japan’s continuing economic recovery. We secured a higher number of domestic passengers compared with the previous fiscal year, helped by firm business demand as well as several initiatives to improve competi- Operating Revenues tiveness and convenience. Our Tabi- Wari discount fare system was also an (¥ Billions) 1,500 important factor in generating new Review of Operations 1,248.7 demand. 1,200 The number of international 19 passengers also increased from the 900 previous fiscal year, supported by strong business demand. Demand on 600 China routes, which fell in the previ-

300 ous year in response to the negative Boeing 737-700 Gold Jet effect of anti-Japan demonstrations, All Nippon AirwaysLtd. Co., 0 03/3 04/3 05/3 06/3 07/3 recovered completely. Expansion of our international network also proceeded such as reopening our Narita–Chicago route. In domestic cargo and mail operations, although in the sec- ond half of the year the operating environment turned severe Operating Income (Loss) / Assets / ROA Operating Income (Loss) Margin as new players entered the market, domestic cargo and mail (¥ Billions) (%) (¥ Billions) (%) volume increased year on year, supported by higher movement 100 8 1,600 1,447.7 9 of goods due to the economic recovery. In international cargo 6.4 and mail operations, volume rose sharply as we expanded Asia 75 79.7 6 1,200 6 routes and flights in the first half of the year and North America 5.5 50 4 routes and flights in the second half. 800 3 Under these circumstances, we responded to rising jet 25 2 fuel prices. In addition to fare and fuel surcharge revision, we matched aircraft supply to demand and rigorously reduced 400 0 0 0 operating costs. As a result, we achieved record-high operating revenues and income in air transportation operations in the –25 03/3 04/3 05/3 06/3 07/3 –2 0 03/3 04/3 05/3 06/3 07/3 –3 Operating Income (Loss) (¥ Billions) Assets (¥ Billions) ROA (%) fiscal year under review. Operating Income (Loss) Margin (%) Air Transportation Domestic Passenger Operations

Kumamoto, and Nagasaki. This initiative resulted in a major Domestic Passenger Operations increase in the number of our flights on this route and enhanced Highlights convenience for customers. Figures in parentheses show change from previous fiscal year.

Passenger revenues ...... ¥726.0 billion (+6.0%) Strengthened Competitiveness through Discount Fares Passenger numbers ...... 46.5 million (+2.2%) and Enhanced Service Available seat-kilometers . . . . . 62.4 billion (+2.4%) While matching aircraft supply to demand, we also took steps Unit revenues ...... ¥11.6 (+¥0.4) to tap into demand generated by holiday seasons, including Yield ...... ¥17.9 (+¥0.6) Golden Week, school summer holidays, New Year, and short Unit price ...... ¥15,624 (+3.7%) national holiday periods, by actively promoting charter flights and the Tabi-Wari discount fare system. In the second half of the year, we introduced the Okinawa travel promotion campaign Overview of fiscal year ended March 2007 Mattarina-Hokkorina Okinawa, Ishigaki, and Miyako nationwide for the fall and winter seasons. In passenger services, we increased the number of Super Increases in Both Passenger Numbers and Unit Price Seat Premium seats and promoted them on routes with strong The number of passengers increased, supported by individual business demand, where they have already proved popular. business traveler demand generated by the economic recovery. In September 2006, in line with the key words “simple” and The Tabi-Wari discount fare system, introduced in April 2006, also “convenient,” we introduced the SKiP service, which eliminates contributed to the rise in passenger numbers. We achieved a the need for check-in at airports. We also enhanced the added significant increase in the unit price through the revision of fares value of the ANA Mileage Club in our continuing efforts to in April 2006 (approximately a 4% fare increase) and the alloca- strengthen competitiveness through the provision of improved tion of seats in line with demand trends. and expanded service. Moving Flights to High-Profit Routes While maintaining our basic domestic route network, we worked Review of Operations to reduce the number of low-profit routes while shifting flights 20 to routes with higher profitability. In the second half of the year, we developed new networks based on connecting flights, mainly bound for Okinawa islands. Seeking enhanced profit- ability, we further promoted the matching of aircraft supply to demand and introduced smaller aircraft, such as the Boeing 737-700, in order to cut operating costs. Further, in April 2006, we

All Nippon AirwaysLtd. Co., entered into a code-sharing agreement with Skynet Asia Airways Co., Ltd., for all flights on the route from Haneda to Miyazaki, Boeing 777-200

Revenues as a Percentage Operating Revenues Available Seat-km (ASK) / Unit Revenues / Passenger Yield of Total Operating Revenues Revenue Passenger-km (RPK) / Load Factor (¥ Billions) (km Billions) (%) (¥) 800 726.0 80 80 20 17.9 65.0 42.2% 62.4 600 60 60 15 5.7 40.5 400 40 40 11.6

10 200 20 20

0 03/3 04/3 05/3 06/3 07/3 0 03/3 04/3 05/3 06/3 07/3 0 0 03/3 04/3 05/3 06/3 07/3 Available Seat-km (ASK, Billions) Load Factor(%) Unit Revenues Passenger Yield Revenue Passenger-km (RPK, Billions) Review of Operations

21

Super Seat Premium New SKiP Service from September 1, 2006

Previous Domestic Check-In Procedure All Nippon AirwaysLtd. Co.,

Reservation and Check-in Ticket Security Boarding (Gate) 1 ticket purchasing 2 (Seat selection) 3 (Boarding pass) 4 inspection 5

On-line (PC or cell phone) or On-line (PC or cell phone) Obtain at airport Present ticket Present ticket at travel agency after 10 p.m. of prior evening

Touch IC or Touch IC or New SKiP Service two dimensional (QR) code two dimensional (QR) code Skip check-in and go directly to security inspection Reservation and Security Boarding (Gate) 1 ticket purchasing 2 Inspection 3 (Seat selection)

On-line (PC or cell phone) or at travel agency Checked in No check-in needed Air Transportation International Passenger Operations

Expanding Our International Route Network International Passenger Operations In our route network, we targeted the dynamic business growth Highlights areas of Asia and, in particular, China. We matched supply to Figures in parentheses show change from previous fiscal year. demand on the Kansai–Qingdao, Xiamen and Narita–Qingdao, Xiamen routes through the introduction of smaller aircraft and Passenger revenues...... ¥278.4 billion (+21.5%) increased flights. We increased flights on the Narita–Singapore Passenger numbers...... 4.6 million (+10.1%) route from October 2006 and opened two new routes, Centrair– Available seat-kilometers. . . . . 26.6 billion (+5.0%) Tianjin in February 2007 and Centrair–Guangzhou in March 2007. Unit revenues...... ¥10.5 (+¥1.4) The reopening of the Narita–Chicago route in October 2006 Yield...... ¥13.8 (+¥1.6) reinforced our network covering North America, including transit Unit price...... ¥61,171 (+10.3%) demand in the U.S. Midwest and Canada. A new code-sharing agreement was reached with Swiss International Airlines, and we expanded our existing code-sharing agreements with Shanghai Overview of fiscal year ended March 2007 Airlines and Asiana Airlines.

Passenger Numbers Increase on Strong Demand Improved Infrastructure and Service Buoyed by strong business demand, international passenger With ANA’s move to the South Wing of Terminal 1 at Narita operations performed solidly during the fiscal year under review, Airport, 10 Star Alliance members now share the same terminal. recovering completely from the negative effect of the April 2005 This has resulted in a significant reduction in transit times for anti-Japan demonstrations in China. In this favorable operating passengers using our Asian network or traveling with our Euro- environment, we achieved synergies through the expansion pean and U.S. partners. Also, service has been enhanced with of our network by reopening the Narita–Chicago route and increasing flight frequencies on China and other Asia routes. As a Route Expansion during Year under Review result, growth in the number of international passengers during the year exceeded that in passenger seat availability. Centrairntratr We moved on several fronts to improve service, targeting ChicagChicago

Review of Operations Tianjianjin growing markets with our Eco-Wari individual discount fares and QingdaoQingdao NaritaNarita 22 implementing the Live/China/ANA campaign. Convenience was Kansaisai enhanced by our relocation to the South Wing of Terminal 1 at XiamenXiamen Narita Airport in June 2006, and we completed the introduction Guangzhoangzhou of the New Style, CLUB ANA service on all North America routes.

We also launched the ANA BusinessJet service on the Centrair– Bangkok Guangzhou route. All Nippon AirwaysLtd. Co., Singapore

Revenues as a Percentage Operating Revenues Available Seat-km (ASK) / Unit Revenues / Passenger Yield of Total Operating Revenues Revenue Passenger-km (RPK) / Load Factor (¥ Billions) (km Billions) (%) (¥) 300 278.4 40 80 15 75.7 13.8 16.2% 30 26.6 60 200 10 10.5 20.1 20 40

100 5 10 20

0 03/3 04/3 05/3 06/3 07/3 0 03/3 04/3 05/3 06/3 07/3 0 0 03/3 04/3 05/3 06/3 07/3 Available Seat-km (ASK, Billions) Load Factor(%) Unit Revenues Passenger Yield Revenue Passenger-km (RPK, Billions) South Wing of Terminal 1 at Narita Airport the introduction of Smart-e service, which targets simplicity and Revenue Composition on ASK / RPK Composition on International convenience, as well as more extensive lounge facilities. International Routes by Destination Routes by Destination (For the year ended March 2007) Further, ANA developed ties with other companies to promote (For the year ended March 2007) (%) 100 8 8 Resorts e-ticketing for flights. At the end of March 2007, with systems Asia, excluding China 23% 23 23 connection to 27 airlines completed, the passenger utilization Resorts 80 Asia, excluding China ratio of e-ticketing service rose to 70%. 5% 16 13 China 60 North America 26%

26 Europe Review of Operations Enhanced Internet Sales Service for International Routes 24 40 The ANA SKY WEB site, which handles Internet ticket sales for Europe 24% international flights, has been renewed and upgraded. Reserva- 23 20 29 30 North America tions can now be made for overseas onward-bound flights of China 22% other airlines as well as for award tickets, including those of 0 ASK RPK affiliated companies. The site also handles changes to reserva- tions and repayments. A range of services based on information technology have now been enhanced by their integration into

Smart-e ticket. All Nippon AirwaysLtd. Co.,

ANA’s lounge at Narita Airport won the Fiscal Year 2006 Good Design Award for creating a sense First class of high-quality space. Air Transportation Cargo and Mail Operations

deliveries between companies and shipments of vegetables due Cargo and Mail Operations to the warm winter. Cargo volume and revenues both increased Highlights year on year. Figures in parentheses show change from previous fiscal year. Late-night scheduled cargo flights were adversely affected by Cargo and mail revenues. . .¥105.1 billion (+8.7%) scheduling changes due to maintenance and repair work on a Cargo volume...... 735.5 thousand tons (+6.7%) Haneda Airport runway and by the entry of GXY into the market. Cargo revenues...... ¥92.7 billion (+9.1%) However, the introduction of the Boeing 767 freighter on the Mail volume...... 106.4 thousand tons (+4.5%) Haneda–Saga route meant that we were able to meet late-night Mail revenues...... ¥12.3 billion (+6.0%) cargo flight demand.

Mail Volume Also Increases Mail volume rose from the previous fiscal year as Japan Post Domestic Cargo and Mail deliveries increased during the summer Ochugen gift season, Highlights and late-night scheduled cargo flights also performed well. Figures in parentheses show change from previous fiscal year.

Cargo volume...... 457.9 thousand tons (+3.9%) International Cargo and Mail Cargo revenues...... ¥30.5 billion (+3.1%) Highlights Mail volume...... 91.0 thousand tons (+4.0%) Figures in parentheses show change from previous fiscal year. Mail revenues...... ¥8.9 billion (+4.1%) Cargo volume...... 277.6 thousand tons (+11.6%) Cargo revenues...... ¥62.1 billion (+12.3%) Overview of fiscal year ended March 2007 Mail volume...... 15.4 thousand tons (+8.0%) Mail revenues...... ¥3.4 billion (+11.2%) Increased Deliveries Result in Higher Cargo Volume and Revenues Review of Operations In the first half of the year under review, cargo volume increased Overview of fiscal year ended March 2007 24 compared with the previous year, driven by the strong economy and its positive effect on the movement of goods and a decline Significant Increases in Volume Centering in the volume of cargo carried by competitors. In the second on North America and China Routes half, the operating environment grew severe. In November In the first half of the year under review, shipment volume grew 2006, Galaxy Airlines Co., Ltd. (GXY), entered into a code-sharing as Asia routes serviced by cargo freighters were expanded and agreement with Japan Airlines (JAL), and this had an adverse flights increased. From August 2006, ANA & JP Express Co., impact on certain of our routes. However, over the whole Ltd., began cargo services on the Haneda–Kansai–Shanghai All Nippon AirwaysLtd. Co., year, the trend was generally favorable, with increased cargo route. In the second half, shipment volume increased sharply,

Revenues from Cargo and Mail Revenues as a Percentage Cargo and Mail Volume: Cargo and Mail Volume: of Total Operating Revenues Domestic International (¥ Millions) (Thousand tons) (Thousand tons) 2007 2006 2005 500 457.9 300 277.6 Cargo 92,769 85,039 79,604 Mail 12,374 11,677 11,384 Domestic 2.3% 400 International 3.8% Revenues from Domestic Cargo and Mail 200 (¥ Millions) 300 2007 2006 2005 Cargo 30,574 29,659 29,515 Mail 8,936 8,586 8,581 200 100 Revenues from International 91.0 100 Cargo and Mail (¥ Millions) 15.4 2007 2006 2005 Cargo 62,195 55,380 50,089 0 03/3 04/3 05/3 06/3 07/3 0 03/3 04/3 05/3 06/3 07/3 Cargo Mail Cargo Mail Mail 3,438 3,091 2,803 Building a Business Foundation with an Expanding Network

North America

Tianjin Dalian Narita Seoul Kansai Haneda Qingdao Centrair

Shanghai

Xiamen Taipei Boeing 767-300 freighter Hong Kong despite a decline in shipments from Europe. There was a signifi- cant rise in shipments from North America, and shipments from Bangkok Southeast Asia and China also grew, supported by increases in supply volume and robust cargo movement during the Christ- mas season. centered on North America and China routes. In October 2006, we introduced our fourth Boeing 767 freighter and established Growth in Mail Volume from North America the Centrair–Chicago route. We also increased flights on China and “Next-Day Arrival” Deliveries to Shanghai routes and reopened the Narita–Chicago passenger route. Despite a decrease in shipments from Europe and China to Outbound shipment volume was up year on year, reflecting Japan, shipments from North America increased, and we a strengthened sales system and increased flights on North shipped higher volume on our “next-day arrival” delivery service America, China, and other Asia routes. However, shipments to from Japan to Shanghai. Revenues also grew due to an increase

Europe decreased. Inbound shipment volume also increased, in the volume of long-haul mail, which has a high unit price. Review of Operations 25

Air Transportation Other Transportation Services All Nippon AirwaysLtd. Co.,

Other Transportation Services

Highlight Figure in parentheses shows change from previous fiscal year.

Other transportation services revenues. . . ¥139.0 billion (+14.4%)

We worked to increase revenues from in-flight sales as well as from aircraft maintenance and ground handling services Ground handling service provided to other airlines, such as passenger check-in and baggage handling. In the year under review, revenues from ANA Real Estate Co., Ltd., were transferred from the other businesses segment to the air transportation segment. As a result, revenues increased 14.4%, to ¥139.0 billion from the previous year.

Catering service Travel Services

Travel Services departure days” for selected products. We continue to develop products that target demand among senior citizens, such as Highlights baby boomer couples. Figures in parentheses show change from previous fiscal year.

Travel services revenues ...... ¥208.0 billion (+4.3%) Strengthening Internet-Based Direct Sales Business Operating expenses...... ¥206.1 billion (+5.0%) In June 2006, we launched Dynamic Package (Tabi-Saku), our Operating income...... ¥1.9 billion (–40.3%) Internet-based direct sales product for domestic travel. This Domestic package tours service allows travelers to freely combine flights and hotel revenues...... ¥140.5 billion (+2.8%) accommodation. Deployed ahead of other companies, Dynamic International package tours Package has enjoyed great success, with more than 20,000 users revenues...... ¥45.6 billion (+10.7%) at the end of March 2007. Other revenues...... ¥21.7 billion (+1.6%) ROA ...... 3.8% (–2.9 percentage points) Passenger Sales Consigned to ANA Sales Co., Ltd. The travel services segment accounted for 12.1% of total operating In the fiscal year under review, ANA revenues before eliminations. transferred the consignment of all flight ticket sales to ANA Sales Co., Ltd. Overview of fiscal year ended March 2007 (excluding domestic corporate sales).

Increases in Both Revenues and Customer Numbers The travel services segment recorded increases in both operating revenues and customer numbers as tourism demand The Great Wall, China stayed firm. However, operating income declined due to fierce price competition and stepped-up investment in IT systems. In domestic travel services, we continued to promote our Sky

Review of Operations Holiday travel packages while embarking on a number of new initiatives. In a tie-up with Hato Bus Co., Ltd., we launched original 26 excursion tours and environmental education tours to such facilities as the Toyota Shirakawa- Travel Services Revenues Go Eco-Institute. In international (¥ Millions) travel services, we expanded the 2007 2006 2005 Domestic Package content of our Hallo Tours and Tours Revenues 140,570 136,794 124,650 International Package generated demand through such Tours Revenues 45,666 41,248 41,885 All Nippon AirwaysLtd. Co., innovations as “women-only Other Revenues 21,790 21,450 23,759 Okinawa

Revenues as a Percentage Operating Revenues Operating Income / Assets / ROA of Total Operating Revenues Operating Income Margin (¥ Billions) (¥ Billions) (%) (¥ Billions) (%) 250 4 4 80 8 208.0 12.1% 200 3 3 60 6 51.8

150 1.9 2 2 40 4 3.8 100

1 1 20 2 50 0.9

0 03/3 04/3 05/3 06/3 07/3 0 03/3 04/3 05/3 06/3 07/3 0 0 03/3 04/3 05/3 06/3 07/3 0 Operating Income (¥ Billions) Operating Income Margin (%) Assets (¥ Billions) ROA (%) Hotel Operations

Hotel Operations

Highlights Figures in parentheses show change from previous fiscal year.

Hotel operations revenues...... ¥66.6 billion (+0.4%) Operating expenses...... ¥61.4 billion (–0.5%) Operating income ...... ¥5.2 billion (+12.7%) Accommodation revenues . . . . . ¥25.8 billion (+3.7%) Banquet revenues ...... ¥19.0 billion (+2.8%) Food and beverage revenues . . . ¥16.6 billion (+0.3%) Other revenues ...... ¥5.1 billion (–19.0%) IHG CEO Andrew Cosslett and ANA President and CEO ANA InterContinental Hotel Tokyo Mineo Yamamoto ROA ...... 3.6% (+0.1 percentage point)

The hotel operations segment accounted for 3.9% of total operating Corporate Strategy (April 2006 to March 2010), ANA transferred revenues before eliminations. the shares and assets of 14 subsidiary companies, including 13 directly managed hotels, outside the Group. Overview of fiscal year ended March 2007 IHG ANA Hotels Group Japan will continue to operate and Establishment of IHG ANA Hotels Group Japan franchise the 30 domestic hotels Joint Venture in its portfolio, including the 13 Segment operating revenues and operating income both transferred hotels mentioned increased, supported by steady demand throughout the year. above. At our flagship hotel, ANA Hotel Tokyo, rigorous yield manage- Guest service ment in accommodations boosted both capacity utilization and average room unit cost. As a result, the hotel recorded higher revenues in all segments: accommodations, banquets, and food Review of Operations and beverage. ANA hotels in the Okinawa resort area also posted 27 higher operating revenues as tourism demand stayed robust. Hotel Operations Revenues In December 2006, we formed a joint venture with the (¥ Millions) InterContinental Hotels Group, the world’s largest hotel group 2007 2006 2005 Accommodation by number of rooms. The joint venture, IHG ANA Hotels Group Revenues 25,804 24,895 23,483 Banquet Japan, will play a central role in our efforts to strengthen hotel Revenues 19,088 18,576 17,818 Food and Beverage operating functions. Revenues 16,611 16,568 15,776

Other All Nippon AirwaysLtd. Co., On June 1, 2007, in line with the ANA Group Mid-Term Revenues 5,134 6,337 12,421

Revenues as a Percentage Operating Revenues Operating Income (Loss) / Assets / ROA of Total Operating Revenues Operating Income (Loss) Margin (¥ Billions) (¥ Billions) (%) (¥ Billions) (%) 80 8 8 160 6 7.8 143.1 66.6 3.9% 6 5.2 6 60 120 4 3.6 4 4 40 80 2 2 2

20 40 0 0 0 0

0 03/3 04/3 05/3 06/3 07/3 –2 03/3 04/3 05/3 06/3 07/3 –2 0 03/3 04/3 05/3 06/3 07/3 –2 Operating Income (Loss) (¥ Billions) Assets (¥ Billions) ROA (%) Operating Income (Loss) Margin (%) Other Businesses

Other Businesses

Highlights Figures in parentheses show change from previous fiscal year.

Operating revenues...... ¥196.8 billion (+3.1%) Operating expenses...... ¥191.2 billion (+3.9%) Operating income...... ¥5.6 billion (–17.3%) Trading and retailing revenues . . . ¥136.7 billion (+7.7%) Information and telecommunications

revenues...... ¥26.3 billion (+1.2%) ANA House Tokyo (Duty free shop) Real estate and building maintenance Information and Telecommunications Revenues revenues...... ¥12.5 billion (–27.5%) Infini Travel Information, Inc., which provides an international Other revenues...... ¥21.1 billion (+2.9%) reservation and ticketing system to airlines and travel agencies, ROA ...... 4.5% (+0.2 percentage points) made good progress with its INFINI LINX Internet reservations tool and other strategic products. With the rebound in tourism The other businesses segment accounted for 11.4% of total operating revenues before eliminations. demand for Asia, especially South Korea and China, the number of international reservation and ticketing system transactions Overview of fiscal year ended March 2007 rose sharply, resulting in higher revenues. ANA Information Systems Planning Co., Ltd., which principally Trading and Retailing Revenues provides information systems development, maintenance, and In March 2006, All Nippon Airways Trading Co., Ltd., which operations services to ANA Group companies, received orders conducts the trading and retailing of goods, merged with for the SKiP service, which will renew systems throughout the ANK Trading Co., Ltd., and strengthened its sales system. In Group. It also received orders for development related to new the trading division, all segments performed well, with higher travel system services. The maintenance and operations division

Review of Operations transactions in electronic components leading to a consider- received orders from ANA related to new systems, and it also able increase in revenues from provided services to companies outside the Group. As a result, 28 Other Businesses Revenues information and telecommunications revenues increased. machinery. Both the trading and (¥ Millions) retailing divisions recorded large 2007 2006 2005 Trading and Retailing gains in operating revenues Revenues 136,795 126,969 121,920 Real Estate and Building Maintenance Revenues Information and The general real estate leasing operations of ANA Real Estate Co., compared with the previous Telecommunications 26,386 26,067 25,043 Revenues Ltd., were sold to a company outside the ANA Group in March fiscal year. Real Estate and Building Maintenance 12,553 17,306 17,391 2006, which resulted in a decline in real estate and building Revenues

All Nippon AirwaysLtd. Co., Other Revenues 21,161 20,571 19,003 maintenance revenues.

Revenues as a Percentage Operating Revenues Operating Income / Assets / ROA of Total Operating Revenues Operating Income Margin (¥ Billions) (¥ Billions) (%) (¥ Billions) (%) 250 8 4 200 4.5 5

196.8 11.4% 2.9 200 160 4 6 3 5.6 116.5 150 120 3 4 2 100 80 2

2 1 50 40 1

0 03/3 04/3 05/3 06/3 07/3 0 03/3 04/3 05/3 06/3 07/3 0 0 03/3 04/3 05/3 06/3 07/3 0 Operating Income (¥ Billions) Operating Income Margin (%) Assets (¥ Billions) ROA (%) CSR (Corporate Social Responsibility)

In April 2007, the Company established the CSR Promotion Division, with the objective of further enhancing corporate value by mobilizing the entire Group in the areas of society, the environment, and sustainable co-existence.

CSR – Basic Perspective and Promotion External Evaluations

Basic Perspective ANA Achieves Inclusion in FTSE4Good Index* The ANA Group has a diverse range of stakeholders – customers, In September 2006, ANA was selected for inclusion in the shareholders and investors, employees, business partners, and FTSE4Good Index, an internationally recognized index of corpo- local communities. The foundation of our CSR activities is to rate social responsibility investment. fulfill our responsibility to stakeholders through constant com- For inclusion, companies must meet munication with them, allowing us to co-exist with society in a evaluation criteria in the following sustainable manner while enhancing corporate value. areas: environmental conservation CSR means that each ANA Group member understands and activities, support of human rights, follows the ANA Group Corporate Philosophy, thereby giving all positive relationships with stake- stakeholders a sense of security and trust. With our responsibil- holders, and prevention of corrupt ity for safety at the core, we will fulfill our responsibilities to practices and bribery. * The FTSE4Good Index is one of two major international stakeholders in the following three categories: indices for socially responsible investment (SRI). FTSE is an independent company owned by the Financial Times and the London Stock Exchange. It creates 1. We will fulfill our economic responsibility* by ensuring safety and manages indices measuring the performance of companies by business, financial, and other criteria. and compliance (base line). 2. To improve quality and employee motivation, we will fulfill our responsibility to customers by enhancing CS (Customer AAA Rating for Advanced Sustainable Satisfaction) and to employees by increasing ES (Employee Management Strategy Satisfaction). In 2006, U.S.-based Innovest Strategic Value Advisors, which 3. We will fulfill our responsibility for social innovation by helping rates more than 2,000 corporations around the world on envi- CSR to solve community and environmental problems. ronmental and social issues, gave ANA a Triple A (“AAA”) rating, * Economic responsibility is the responsibility to implement thorough risk management and the highest of seven ratings. Of the 16 airlines rated in 2006, only 29 to effectively and efficiently run business operations. Together with compliance responsibility, the internal control system has been reinforced. 4 received this rank. Our advanced sustainable management strategy has therefore earned the top rating among airlines in ANA’s Perspective on CSR Asia and the United States.

Shareholders All Nippon AirwaysLtd. Co., Customers & Investors

Business Responsibility to Social Innovation* Employees Partners Customer Satisfaction Employee Satisfaction (quality enhancement) CS ES (motivation enhancement)

Innovest 2006 rating (extract) Communities Public Financial Responsibility Authorities Compliance Responsibility

Safety Responsibility

Global Environment

* ANA’s Social Innovation: The role ANA plays through possible cooperation and support from a corporate standpoint toward the solution of social and environmental problems. Environmental Conservation Activities lilies of the valley came from the area around . Under the slogan “Thinking of People and Earth,” ANA encourag- This event has been carried out since 1956. Patients and es employees to raise their environmental awareness and, at the hospital staff show great appreciation every year same time, implements a variety of environmental conservation for these gifts. Lily of the valley bookmark activities. The ANA Group Ecology Plan, which covers the period from April 2003 to March 2008, sets out a range of activities, Presenting the lily of the valley bookmarks from environmental compliance to forestation.

Efforts to Counter Climate Change The core initiative of the ANA Group Ecology Plan is to counter climate change through the reduction of CO2 emissions. The plan calls for reducing CO2 emissions per available seat-kilometer (ASK) in the fiscal year ending March 2008 by 12% from the level in the fiscal year ended March 1991. We have implemented various initiatives in order to attain this target. The amount of CO2 emitted by ANA aircraft for the fiscal year ended March 2007 was 8.11 million tons, an increase of 4.4% from the previous year, reflecting operational expansion. CO2 emissions per ASK were 24.63 grams of carbon, slightly higher than in the previous year. However, the level of approximately 12% lower than the Asada’s Memorial Flight base-year level of the fiscal year ended March 1991 has been On April 21, 2006, more than 100 ANA Group volunteers served maintained. on a special 50-minute flight between Sendai and Yamagata for the pupils of the Nishitaga Hospital School for the Physically ANA’s CO2 Emissions per ASK / Fuel Consumption Challenged. The original idea for this flight dated back 43 years

CSR (million kL) (g-C Converted to carbon/ASK) 4 30 to Captain Tadashi Asada*. For those pupils who were not able to 30 make it to the airport, a virtual flight was simulated at the school. * See ANA’s CSR Report 2005, page 29, for further details. 3 27 24.63

2 24.49 (Target) 24

1 21 All Nippon AirwaysLtd. Co.,

0 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 0 Fuel Consumption (million kL) CO2 Emissions per Unit (g-C Converted to carbon/ASK) (Years ended March 31) Students of Nishitaga Hospital School

Social Contribution Activities

Through its activities, the ANA Group maintains close relations with and makes wide contributions to local communities and society.

Lily of the Valley Presentation Event On June 9, 2006, ANA Group cabin crew and airport ground staff visited 52 hospitals around the country, including the Japanese Red Cross Society Medical Center. They presented bookmarks made from lily of the valley pressed flowers to patients. The Financial Section Financial Section Financial

Contents 32 Management’s Discussion and Analysis 31 40 Operating Risks 42 Consolidated Balance Sheets 44 Consolidated Statements of Income 45 Consolidated Statements of Changes in Net Assets All Nippon AirwaysLtd. Co., 46 Consolidated Statements of Cash Flows 47 Notes to Consolidated Financial Statements 62 Report of Independent Auditors Management’s Discussion and Analysis

Overview International Routes In the fiscal year ended March 31, 2007, the number of passengers Economic Conditions carried by Japanese airlines on international routes declined 1.5% In the fiscal year ended March 31, 2007, despite the negative influence from the previous year, to 17.4 million. Demand on Asia routes, such of crude oil price hikes, the Japanese economy saw an upturn in as China, South Korea, and Taiwan, was robust, and the number of employment and continued growth in capital investment on the passengers on these routes rose 6.1% from the previous year, to 10.6 back of improved corporate earnings. In the second half of the year, million. However, the number of passengers on continental United although consumer spending began to weaken, the economy States, Europe, Oceania, and other routes declined. The volume of continued trending toward recovery. cargo declined 1.1% from the previous year, to 1,310.4 thousand tons.

Trends in the Air Transportation Industry Number of Passengers Cargo Tons Global Air Transportation Industry (Millions) (Thousand tons) 96.9 In 2006, demand for international air transportation rose, with 100 1,500 increases of 5.9% in revenue passenger-kilometers and 4.6% in cargo 1,310.4

ton-kilometers. 80 1,200 Demand grew steadily in the Asia-Pacific region, with revenue 904.9 passenger-kilometers up 5.3% and cargo ton-kilometers up 4.7%. 60 900 In North America, revenue passenger-kilometers increased 5.7%

and cargo ton-kilometers rose 6.0%. And, Europe saw a 5.3% increase 40 600 in revenue passenger-kilometers and a 1.7% rise in cargo ton- 17.4 kilometers. In particular, the Middle East enjoyed marked growth in 20 300 demand for air transportation, with increases of 15.4% in revenue passenger-kilometers and 16.1% in cargo ton-kilometers. 0 03/3 04/3 05/3 06/3 07/3 0 03/3 04/3 05/3 06/3 07/3 Domestic International Domestic International Source: Ministry of Land, Infrastructure and Transport Source: Ministry of Land, Infrastructure and Transport Yearly Change in Revenue Yearly Change in Cargo Ton-km Passenger-km (%) (%) 30 30 ANA Group

Financial Section Financial Improving Profitability The ANA Group comprises All Nippon Airways Co., Ltd. (ANA), 20 20 32 128 subsidiaries, and 44 affiliates. The Group’s operations consist of Air Transportation, Travel Services, Hotel Operations, and Other 10 10 Businesses. 5.7 6.0 5.3 4.7 5.3 1.7 Performance in the Year Ended March 31, 2007 0 0 In the fiscal year ended March 31, 2007, thanks to measures to increase revenues and revisions of fares on domestic and All Nippon AirwaysLtd. Co., –10 02 03 04 05 06 –10 02 03 04 05 06 international routes, operating revenues were up 8.8%, to a record Europe North America Asia-Paci c Europe North America Asia-Paci c Sources: IATA, ICAO Sources: IATA, ICAO ¥1,489.6 billion. The Company limited operating expenses to a 9.2% increase, to ¥1,397.4 billion, by partially offsetting hikes in fuel costs through efforts to match supply to demand and standardize the fleet Domestic Air Transportation Industry in order to reduce operating costs as well as rigorous cost reduction Domestic Routes efforts. As a result, operating income rose 3.8%, to a new high of In the fiscal year ended March 31, 2007, the number of passengers ¥92.1 billion, with all operating segments posting profits. on scheduled domestic routes rose 2.6% from the previous year, to In net non-operating expenses, improvement in net interest 96.9 million. The Tokyo–Sapporo and Tokyo–Okinawa trunk routes expenses due to a reduction in interest-bearing debt and a gain on recorded increases in passengers, but the number of passengers sale of investments in securities helped to counteract expenses on other trunk routes declined. Overall, the number of passengers incurred due to a loss on the disposal of aircraft parts and refurbishment on trunk routes declined 1.2% from the previous year, to 38.6 million. expenses accompanying the return of lease aircraft, an impairment Local routes performed well overall, with the number of passengers loss for aircraft, and a loss on the disposal of assets accompanying rising 5.3% from the previous year, to 58.3 million. The volume of ANA’s relocation to Passenger Terminal 1 at Narita Airport. As a result, cargo rose to 904.9 thousand tons, an increase of 1.7% from the net income was up 22.2%, to ¥32.6 billion. ROA improved 0.3 previous year. percentage points, to 6.0%. Management’s andAnalysis Discussion increased maintenanceoutsourcingexpenses. blades, ariseinmaintenancedoneforothercompanies,and measures involvingthereplacementofPratt&Whitneyengine increase wasprincipallyduetoexpensesrelatedlong-termsafety Aircraft maintenanceexpensesrose4.7%,to¥64.2billion.This Aircraft maintenanceexpenses–partsandcontracts the decisiontosellBoeing747-400s. aircraft from 109 to 125 and accelerated depreciation that accompaniedmainly becauseofanincreaseinthenumberCompany-owned Depreciation andamortizationexpensesrose19.8%,to¥81.4billion, Depreciation andamortizationexpenses though leasefeesweredecreasedbypurchasingofaircraft. with code-sharingSkynetAsiaAirwaysandUnitedAirlines,even attributable toaslightincreaseinseatblockingexpensesassociated Aircraft leasingexpenseswereup0.6%,to¥87.2billion,mostly Aircraft leasingexpenses rose 3.8%,to¥104.2billion,thankstheuseofsmalleraircraft. and 14.0%oninternationalroutes,landingnavigationfeesonly Although thenumberofflightsincreased6.7%ondomesticroutes Landing andnavigationfees optimal altitudeoperation. measures toincreasefuelefficiency,includingenginewashingand Further, tocurbusagevolumes,theCompanytookfuelmanagement in planned,ongoinghedgetransactionsforspecificperiodsoftime. by hedgingrisksusingcrudeoilandjetfuelcommodityderivatives to controltheriskofjetfuelpricefluctuationsandstabilizeexpenses operational expansion.Asinthepreviousyear,Companysought the effectofcrudeoilpricehikesandincreasedusageaccompanying Fuel andfueltaxexpenseswereup31.3%,to¥236.1billion,due Fuel andfueltaxexpenses Air TransportationExpenses improved 0.2percentagepoints,to5.5%. routes. Operatingexpensesrose10.4%,to¥1,169.0billion.ROA result ofhigherpassengerrevenuesfrominternationalanddomestic Segment revenuesincreased10.3%,to¥1,248.7billion,mainlyasa Air Transportation Review ofOperatingSegments

in-flight serviceexpensesthataccompaniedhighernumbersof Other expensesrose6.7%,to¥190.3billion,mostlyrelatedhigher Other expenses from thedevelopmentofnewroutesfornetworkexpansion. Outsourcing expensesincreased10.3%,to¥80.9billion,stemming Outsourcing expenses accompanying theincreasedmembershipof international passengersandariseinredemptionexpenses primarily attributabletohighernumbersofdomesticand Sales commissionswereup14.2%,to¥91.6billion,whichwas Sales commissions due tobusinessexpansion. higher numbersofpersonnelintheCompanyandGroupcompanies Personnel costsincreased1.1%,to¥232.7billion,largelybecauseof Personnel costs of commercialrealestatebusiness. the resultofan11.5%decreaseinassetsthatresultedfromsale to ¥5.6billion.ROAimproved0.2percentagepoints,4.5%,largely increased 3.9%,to¥191.2billion.Operatingincomedecreased17.3%, Segment revenuesrose3.1%,to¥196.8billion.Operatingexpenses Other Businesses revenues. mainly relatedtoimprovedprofitthataccompaniedincreased 12.7%, to¥5.2billion.ROAimproved0.1percentagepoint,3.6%, expenses edgeddown0.5%,to¥61.4billion.Operatingincomerose Segment revenuesedgedup0.4%,to¥66.6billion.Operating Hotel Operations systems anda3.5%increaseinassets. result ofhigheroperatingexpensesaccompanyinginvestmentin ¥1.9 billion.ROAdeclined2.9percentagepoints,to3.8%,mainlythe grew 5.0%,to¥206.1billion.Operatingincomewasdown40.3%, Segment revenuesrose4.3%,to¥208.0billion.Operatingexpenses Travel Services the renewalofreservationsterminals. passengers andthelump-sumrecognitionofexpensesarisingfrom ANA MileageClub .

33 All Nippon Airways Co., Ltd. Financial Section 34 All Nippon Airways Co., Ltd. Financial Section Other, net expensesforRefurbishment return ofleaseaircraft Special retirement benefitexpenses ofnettransitional retirement benefitobligation Amortization onsaleofinvestmentsGain insecurities Rebate onaircraft purchases inincome(loss)ofaffiliates Equity Valuation receivables lossonotherlong-term Valuation lossoninvestments insecurities loss Impairment andequipment Loss onsaleordisposalofproperty Interest expenses andequipment onsaleofproperty Gain Interest anddividendincome Years endedMarch31, year andrefurbishmentexpensesof¥6.5billionaccompanyingthe shares ofANARealEstateCo.,Ltd.,writtenoffinthepreviousfiscal of investmentsinsecuritiesmainlyduetothedisposalapart increase wasprimarilyassociatedwithan¥18.6billiongainonsale Net non-operatingexpensesrose¥4.7billion,to¥41.1billion.This Non-Operating Income(Expenses) Note: Operating expensesfigures are before intercompany eliminations. Consolidated OperatingExpenses Intercompany Eliminations Other BusinessesExpenses Hotel Operations Expenses Travel Expenses Services Other Outsourcing Sales commissions Personnel andcontracts Aircraft maintenance –parts Depreciation andamortization Aircraft leasing Landing andnavigation fees Fuel andfueltax Air Transportation Expenses Years endedMarch31,

Total Operating Expenses . Total ......

......

. . .

......

interest-bearing debt. a ¥2.4billiondecreaseininterestexpensesduetothereduction a ¥3.7billionreductioninspecialretirementbenefitexpenses;and despite a¥10.7billionlossfortwoBoeing747-400sslatedsale; as a¥9.6billiondecreaseinimpairmentlossfromthepreviousyear return ofleaseaircraft.Thesefactorsoffsetsuchimprovements

¥ ¥ 236,128 1,397,468 1,627,863 1,169,061 ¥ 5,353 (230,395) ¥(41,126) 191,281 206,106 190,301 232,755 104,281 (10,809) (17,708) 2007 61,415 80,992 91,645 64,272 81,465 87,222 2007 (6,533) (6,713) (8,402) 1,916 1,239 1,073 (600) (215) 284 (11)

¥ ¥ Yen (Millions) 1,279,990 1,500,689 1,058,551 Yen (Millions) (220,699) 179,827 ¥ ¥(36,369) 184,123 196,274 178,269 230,151 100,488 2006

(20,451) (10,577) (20,172) 4,681 61,741 73,442 80,274 61,410 67,984 86,706 18,632 2006 (4,373) (6,712) (1,335) 2,051 2,638 (751) – – –

¥ ¥1,215,039 1,432,410 (217,371) ¥(32,095) ¥ 148,584 176,375 187,170 173,918 220,387 998,900 (22,115) (21,117) 2005 69,965 71,461 77,753 53,080 61,703 94,294 97,720 15,969 2005 (5,098) (1,858) (6,712) 1,344 1,581 5,418

(485) 881 97

– –

interest coverageratioimprovedfrom6.3timesto8.9times. before incometaxesandminorityinterests,to¥51.0billion.The ¥20.1 billion,whichcompensatedfora¥1.3billiondeclineinincome mainly duetoa¥27.0billiondecreaseinincometaxespaid, Cash flows from operating activities rose ¥30.1 billion, to ¥158.7 billion, Cash FlowsfromOperatingActivities ¥70.5 billionfromthepreviousfiscalyear-end. equivalents attheendoffiscalyeartotaled¥172.2billion,down minus cashflowsfrominvestingactivities.Asaresult,and flow of¥30.4billion,whichiscashflowsfromoperatingactivities Cash flowsfromfinancingactivitiesof¥100.8billionoffsetfreecash Overview oftheYearunderReview of ourfinancialposition. debt/equity ratioofabout2timesandtoreinforcethesoundness We areworkingtoachieveourmedium-to-long-termtargetfora while controllinginterest-bearingdebtbymanagingfreecashflow. including repaymentofleaseobligations,andtoexpandcapital keep capitalexpenditureswithinthelimitsofoperatingcashflows The ANAGroup’sfundamentalapproachtosourcesoffundsis Fundamental ApproachtoSourcesofFunds Cash Flows dividends were¥3.00pershare. rose 14.9%,to¥204.42.FortheyearendedMarch31,2007,cash Net incomepershareincreased7.2%,to¥16.77.assets Per ShareData

Cash Flows from Operatin Ac bonds, and payment for dividends. booked in the previous fiscal year, stepped-up repaymentbecause of debt of ¥95.8and billion in proceeds from the issuanceCash of newflows stock from financing activities amounted to ¥100.8Cash FlowsfromFinancingActivities billion, primarily of ¥12.2billionrecognizedinthepreviousfiscalyear. Estate andtheaccompanyingproceedsfromcollectionofadvances investing activitieswasthesaleofapartsharesANAReal advances. The principalcauseoftheincreaseincashflowsfrom aircraft, the redemption of securities, and proceeds from collection of cash inflows were related to income associated with the sale of aircraft partsandtheadvancesofpaymentfornewaircraft,while billion. Cashoutflowswererelatedtotheacquisitionofaircraftand Cash flowsfrominvestingactivitiesincreased¥81.8billion,to¥128.2 Cash FlowsfromInvestingActivities (¥ Billions) (¥ 100 150 200 50 tivitie 0 03/3 s 04/3 05/3 06/3 g 158. 07/3 7 Inter In Debt/Equity (T imes est co terest Coverage 10 0 2 4 6 8 Inter ) ve est rage ratio = net cash pr 03/3 Co ve rage Ratio rage 04/3 Ra tio ovided byoperatingac 05/3 Ra De bt/E tio qui ty 06/3 Ratio / tivities / inter 07/3 1. 8. 9 9 est expenses 35 All Nippon Airways Co., Ltd. Financial Section 36 All Nippon Airways Co., Ltd. Financial Section

Total interest-bearingdebt Long-term debt(excluding current portion): debt: Short-term As ofMarch31, slated forintroduction. aircraft andafterleaseadvancepaymentsfor of theacquisition22aircraftthroughpurchasenew-model Fixed assetsincreased3.9%,to¥1,179.5billion,primarilytheresult Fixed Assets aircraft andstepped-upreductionofinterest-bearingdebt. year underreviewthatresultedfromcapitalinvestmentcenteredon shares, aswelllowercashandequivalentsattheendof accompanied fund-raisingactivities,includingtheissuanceofnew was mainlyduetoanincreaseincashatthepreviousyear-endthat Current assetsweredown20.4%,to¥422.0billion.Thisdecrease Current Assets Total assetsatfiscalyear-enddecreased3.9%,to¥1,602.0billion. Total Assets Financial Position

Current portion of long-term loans oflong-term Current portion Short-term bankloans Loans, from principally banks Current portionofbondsandnotes Notes andbond s

.

. . . . .

Long-Term Liabilities aircraft parts. purchase pricesforfueland trade stemmingfromhigher accounts andnotespayable– counteracted a16.6%increasein instruments tonetassets,which deferred gainonhedging factors asthedirectaddingof current liabilitiesduetosuch of a68.2%decreaseinother to ¥473.0billion,mainlybecause Current liabilitiesdeclined1.6%, Current Liabilities Liabilities decreased8.9%,to¥1,196.1billion. Liabilities ¥749.4 billion. debt. Thebalanceofinterest-bearingdebtdecreased11.4%,to attributable toprogressintherepaymentofbondsandlong-term Long-term liabilitiesdeclined13.1%,to¥723.1billion,chiefly

¥ 3,500 ¥749,446 590,722 165,000 425,722 158,724 110,224 2007 45,000

o -balance liabilities In (¥ Billions) (¥ O -balan 1,200 1,500 300 600 900 Yen (Millions) terest-Bearing Debt(includin Inter ¥ 8,690 ¥846,317 0 696,879 240,000 456,879 149,438 ce leaseobligations=notionalprincipalfor est-B 2006 45,000 95,748 03/3 earing De bt 04/3

O -Balanc 05/3

r esidual value after lease terminatio e L ) ease Obligations 06/3 + ¥942,256 ¥ 16,045 1,100.1 139,991 737,802 250,000 487,802 204,454 07/3 48,418 2005 g n hedging instrumentsintonetassets.Theequityratiowas24.9%. in retainedearningsandtheincorporationofdeferredgainon Total shareholders’equitywas¥398.2billionduetoa50.9%increase End oftheYearunderReview Total Shareholders’Equityatthe shareholder value. and accumulateprofitstoincrease profits inanybusinessconditions build astructurethatcangenerate March 2010).TheCompanywill Corporate Strategy(April2006to such astheANAGroupMid-Term management plansandstrategies, will continuetosteadilyimplement shareholders’ equity.TheCompany is workingtoenhanceits Airport approaches,theCompany As the2010expansionofHaneda Fundamental ApproachtoShareholders’Equity Total Shareholders’Equity 2007, inaccordancewithJapaneseCorporationLaw. hedging instrumentsinnetassetsfromtheyearendedMarch31, billion innetincomeandtotherecordingofdeferredgainon increase inretainedearningsresultingfromtherecordingof¥32.6 Total netassetsamountedto¥405.9billion,primarilyduean Total NetAssets Discount rate Net periodicpensionandseverancecost Accrued employees’retirementbenefits Prepaid pensioncost Net amountunrecognized Unfunded retirement benefitobligation Plan assetsatfairvalue Retirement benefitobligation As ofMarch31,/Yearsended31, . . . . . Shareholders (¥ Billions) (¥ 100 200 300 400 500 Shar 0 eholders . . . 03/3 ’ E qui ty 04/3 ’ Equit Eq ui 05/3 ty Ratio y /Equity 06/3 398. 07/3 24. Ra 9 2 tio 20 30 40 50 10 (% 0 ) Bond Ratings Bond issued long-termbondsBBB+andBBB,respectively,asofJune2007. Ltd. (JCR), and Rating and Investment Information, Inc. (R&I), rated ANA- In responsetorequestsbytheCompany,JapanCreditRatingAgency, Bond Ratings Minority interestsincreased7.8%,to¥7.6billion. Minority Interests special retirementbenefitupontheofemployees. to definedbenefitplans.Further,incertaincases,theCompanypays consolidated subsidiariesofferdefinedcontributionplansinaddition sum paymentplans.TheCompanyandcertaindomestic qualified pensionplans,definedbenefitandlump- following definedbenefitplans:welfarepensionfundplans,tax The Companyanditsdomesticconsolidatedsubsidiariesofferthe Retirement BenefitPlans BB BB BB AA AA A A A B B B + + – – – 2002/3

Au g. 2002 ¥(278,278) ¥(112,606) 2003/3 ¥(19,634) (111,578) (160,088) 118,190 2007 48,510 July 2003 July 1,028 2.5%

2004/3 )

2005/3 Yen (Millions) ¥(269,868) ¥(107,377) (106,363) (158,929) ¥(20,591) 110,939 2006 52,566 1,014 2.5% 2006/3

2007/3 ¥(262,224) ¥(107,740) (107,070) (171,897) ¥21,278 2005 JCR 64,827 90,327 2007/6 2.5% 670 R&I 37 All Nippon Airways Co., Ltd. Financial Section 38 All Nippon Airways Co., Ltd. Financial Section Note: Figures inparentheses show changesfrom theprevious year-end. Total F-50 DHC-6-300 DHC-8-300 DHC-8-400 A320-200 A321-100 B737-400 B737-500 B737-700 B767-300F (freighter) B767-300 B777-200 B777-300 B747-400 As ofMarch 31,2007 Fleet Composition Capital Expenditur aircraft, aircraftengines,andparts,informationsystems. comprised aircraft-relatedinvestment,suchastheacquisitionof Capital expenditure,whichrose6.9%,to¥251.9billion,mainly Capital Expenditure (¥ Billions) (¥ 100 150 200 250 300 50 0 . . 03/3 ...... 04/3 ...... 05/3 e

06/3 . 251. 07/3 9

1 +5 15(1) 86 (–1) 125 (+16) 211 (+15) Depr (¥ Billions) (¥ 4(3 0 14 (+3) 0 11 (+6) 18 (–5) 14 (+3) 10 (–2) 29 (+1) 15 (+2) 4 6 (+6) 25 13 10 (+6) 43 (+2) 11 (–2) 7 (+1) 2 (–2) 12 (+5) 56 (+2) 8 (+4) 21 (+2) 23 (+3) 15 (+5) 23 Total –) 3 (–1) 4 0 0 1 0 (–1) 3 (–1) 1 0 (–1) 2 (–5) 5 0 1 (+1) 4 (+1) 3 (–4) 1 0 4 (+1) 100 20 40 60 80 0 eciation andAmor 03/3 04/3 Owned 05/3 06/3 tizatio Leased 07/3 88.6 n Aircraft Procurement:ResultsandPlans refer topage14. sustainable competitiveadvantage. cost competitivenessthatsurpassescompetitors’andestablisha and narrow-body.Throughitsstrategy,theCompanyaimstoachieve current sevenaircrafttypestothreetypes:wide-body,medium-sized, environment-friendly whilestandardizingthefleetinstagesfrom introducing fuel-efficientaircraftthatarehighlyeconomicaland frequency toenhancecustomerconvenience. body aircrafttoreflectdemandtrendswhileincreasingflight efforts, theCompanywillflexiblydeploymedium-sizedandnarrow- risk offluctuationsintheeconomicclimateanddemand.Inthose ANA is taking steps to establish a fleet composition that minimizes the Fundamental ApproachtoAircraftProcurement Aircraft Procurement Five AirbusA320-200swereleasedaftersale. Leased aircraftaftersale 737-500s. two Boeing767-300s,oneAirbusA321-100,and 11 aircraft,comprisingtwoBoeing747-400s,four777-200s, Among theaircraftthatituses,Companypurchasedafterlease Aircraft purchasedafterlease one Fokker50,andBombardierDHC-6-300. The Companyretiredsixaircraft,comprisingfourAirbusA321-100s, Retired aircraft (leases). six Boeing737-700s(purchased),andthreeBombardierDHC-8-400s Boeing 767-300Fcargoaircraft(lease),oneAirbusA320-200 (one purchased,twoleases),Boeing767-300s(leases),one 777-300s (fourpurchased,onelease),threeBoeing777-200s The Companytookdeliveryof21aircraft,comprisingfiveBoeing Newly introducedaircraft For furtherinformationontheCompany’sFleetStrategy,please In jetaircraft,theCompanywillreduceoperatingcostsby

with thisinvestigation. documents wereprovided.TheCompanyisactivelycooperating investigation oftheCompany’sLosAngelesbranch,andvarious the UnitedStatesFederalBureauofInvestigationconductedan cargo arrivalsanddeparturesintheUnitedStates.InMarch2007, warrant totheCompanyrequestingvariousdocumentsrelating same time,inrelationtoitsinvestigation,theagencysubmitteda investigated theCompany’sNewYorkofficeinFebruary2006.At in acargofaresandchargescartel,U.S.law-enforcementagency In relationtosuspicionofmajorinternationalairlines’involvement Others strengthen itsmanagementfoundations. works tosolidifyitsfinancialpositionthroughretainedearningsand In preparationforfutureoperationaldevelopment,theCompany consideration ofbusinessconditionsandperformancetrends. shareholders. Theallocationofprofitsisbasedonacomprehensive The Companygiveshighprioritytoprovidingareturn Fundamental ApproachtoAllocationofProfits Allocation ofProfits Total Other Businesses Hotel Operations Travel Services Air Transportation As ofMarch31, the endofpreviousfiscalyear.Bysegment,AirTransportation As ofMarch31,2007,theGrouphad32,460employees,up7.1%from Employment . . . . .

increase retainedearningsinordertoachievecontinuedsteady In lightoftheneedtofurtherstrengthenitsfinancialpositionand and PlansfortheCurrentYear Dividends intheYearunderReview employees, up7.4%. employees, down1.3%.OtherBusinessesaccountedfor4,118 for 1,861employees,up10.8%.HotelOperationsaccounted2,604 accounted for23,877employees,up7.7%.TravelServices cases. demands forspecificamountshavenotyetbeenmadeinanyofthe ascertaining andanalyzingthedetailsareproblematicbecauseclear and receivedinformationthatitisincludedincomplaints.However, In thatconnection,theCompanyhasreceivedawrittencomplaint for damagesallegedlyresultingfromapricecartelamongairlines. filed anumberofclassactionsagainstairlines,seekingcompensation United StatesandinCanadausersofinternationalcargoflightshave ending March31,2008. year, itplanstopaycashdividendsof¥5.00persharefortheyear year endedMarch31,2007. the Companymaintainedcashdividendsat¥3.00persharefor growth in earnings even in the fiercer competitive conditions expected, Further, inrelationtothisinvestigation,variousregionsofthe If theCompanyreachesitsbusinesstargetsforcurrentfiscal

32,460 23,877 2007 4,118 2,604 1,861

Employee numbers 30,322 22,170 2006 3,836 2,637 1,679

29,098 20,797 2005 3,769 2,887 1,645

39 All Nippon Airways Co., Ltd. Financial Section 40 All Nippon Airways Co., Ltd. Financial Section China thatoccurredintheprevious fiscalyear,triggeredbyissues international operations.Theupsurge ofanti-Japansentimentin to China,whichnowaccountsfor about20%ofrevenuesfrom operations, theGroupiscurrently expandingitsroutes,principally significantly affecttheCompany’s performance.Initsinternational terrorist attacks,oroutbreaksofcontagious diseasescould in revenuesforthatfiscalyear.Theoccurrenceofwars,large-scale international routes,resultinginadropofmorethan¥30.0billion impact onairtransportationandtraveloperations,especially The outbreakoftheIraqwarandSARSin2003hadasignificant Risks RelatedtotheInternationalSituation rates andtostabilizecontrolpaymentamounts. fuel purchasestolimittheriskoffluctuationsinforeignexchange uses forwardexchangeagreementsandcurrencyoptionsforitsjet risk offoreignexchangeratefluctuations.Inaddition,theCompany denominated inthesameforeigncurrency,therebyminimizing foreign currencytakeninasrevenueisusedtopayexpenses Company’s profits.Accordingly,tothegreatestextentpossible, the depreciationofyenwillhaveasignificanteffecton of theCompany’sexpenses,areconductedinforeigncurrencies, Because jetfuelpurchases,whichaccountforasignificantshare Risks RelatedtoForeignExchangeRateFluctuations oil pricescouldsignificantlyaffecttheCompany’sperformance. cost reductionsandhigherfarescharges,prolongedhighcrude the Company’scurrenteffortstooffsethighcrudeoilpricesthrough representing 16.9%ofoperatingexpenses.Giventhelimitations were ¥236.1billion(up¥56.3fromthepreviousfiscalyear), remains atahighlevel. downward trend,thepriceofcrudeoilhasagainstartedtoriseand avoid anyphysicaldeliveryobligations.Whiletemporarilyexhibitinga not affectthespotmarket,andmarginsareadjustedmonthlyto limits thataresetinsuchawaytheCompany’stransactionswill amounts setquarterly.Individualtransactionsaremaintainedwithin purchases offuelinJapanandoverseas,withplansforhedging hedging transactions are limited to a certain percentage of aggregate hedging transactionsforspecificperiodsoftime.TheCompany’s oil andjetfuelcommodityderivativesinplanned,continuous fuel andtostabilizejetexpenses,ANAhedgesrisksusingcrude significant burdenfortheCompany. of crudeoilincreases,thepricejetfuelwillincrease,leadingtoa approximately 75%ofthepricejetfuel.Consequently,if Among thosecosts,thecostofimportingcrudeoilaccountsfor importing, refining,andtransportingcrudeoilcustomstariffs. The priceofjetfuelcomprisessuchexpensesasthecost Risks RelatedtoCrudeOilPriceFluctuations of theconsolidatedfiscalyearunderreview. in thefollowingsectionareANAGroup’sjudgmentsasofend investors intheANAGroup.Further,forward-lookingstatements The followingriskscouldhaveasignificanteffectonthejudgmentof Operating Risks The Group’sfuelandtaxexpensesintheyearunderreview Accordingly, tocontroltheriskoffluctuationsinpricejet

Risks RelatedtoANA’sFleetStrategy to thepricingoffaresandcharges. Law andsimilarlawsregulationsinothercountrieswithregard Further, theGroup’soperationsareconstrainedbyJapaneseAntitrust and thedecisionsofIATA(InternationalAirTransportAssociation). of internationalagreements,includingtreaties,bilateral operations on international routes in accordance with the stipulations The Groupisrequiredtoconductpassengeroperationsandcargo the stipulationsofstatutoryregulationsrelatingtoairlineoperations. As anairlineoperator,theGroupundertakesoperationsbasedon Risks RelatedtoStatutoryRegulations affect theGroup’sperformance. avian flu,whichremainsanongoingconcern,couldsignificantly Sino-Japanese relationsoroutbreaksofsuchcontagiousdiseasesas down andtourismdemandisrecovering;butanyfuturetensionsin become apermanentmemberoftheUNSecurityCouncil,hasdied relating tohistorytextbooks,territorialboundaries,andJapan’sbid occur inthefuture. for HanedaAirportwascancelled. Further,similarchangescould Osaka (Itami)Airportwereincreased andaportionofthereductions under review. However, in the year ended March 2004, landing fees at had theeffectofreducingthese feesbyabout¥12billionintheyear government hasimplementeda policytoreducelandingfees,which ANA Grouptotaled¥104.2billion,or7.5%ofoperatingexpenses. The airport usagefees.Intheyearunderreview,feesfor the Public-sector feesincludelandingandnavigationother Risks RelatingtoPublic-SectorFees Strategy maydiminishsignificantly. the factorsgivenbelow.Further,expectedbenefitsofFleet measures relatedtotheFleetStrategycouldproveineffectivedue aircraft models,andintroducinghighlyeconomicalaircraft.However, centered onusingmedium-andsmall-sizedaircraft,standardizing In airtransportationoperations,theGroupispursuingafleetstrategy performance. Company. SucheventualitiescouldsignificantlyaffecttheGroup’s difficult orimpossibletoraisefundsontermsadvantageous the reorganization ofgovernmentalfinancialagenciesthatmakeit funds couldincreaseduetochangesinthetaxsystemor issuance aswellthroughleasing.However,thecostofraising The Companyacquiresaircraftthroughbankloansandbond Increase inthecostofraisingfunds Group’s performance. its FleetStrategy.Sucheventualitiescouldsignificantlyaffectthe the Groupwouldbeunabletoacquireaircraftinaccordancewith between BoeingandtheCompanyduetofinancialorotherissues, Boeing. Therefore,ifBoeingwasunabletofulfillagreements aircraft, ofwhichalmostall,96havebeenorderedfrom In accordancewithitsFleetStrategy,theCompanyhasordered99 Dependence ontheBoeingCompany

Operating Risks Risks RelatingtoFlightOperations affect theGroup’sperformance. certain countries’antitrustlaws.Sucheventualitiescouldsignificantly ordered todissolveorreducetheextentofitsactivitiesbasedon if amajorpartnerweretoleavethealliance,oralliance However, thebenefitsofStarAlliancemembershipwoulddiminish alliance partnersandheightenednamerecognitionoutsideJapan. variety ofbenefits,includingthesaleticketstocustomers Through itsmembershipinStarAlliance,theCompanyenjoysa and StrategicAlliances Risks RelatedtoIneffectiveJointVentures performance. the passingonofcosts,anincreaseincostscouldaffectGroup’s Further, becausepricecompetitionwithcompetitorsgreatlyrestricts competitiveness andleadtothelossofcustomerscompetitors. Shinkansen, on certainroutes,passingcostscoulddiminish as well as with alternative forms of transportation, such as the the GroupisincompetitionwithotherairlinesJapanandoverseas and pass on costs through higher fares and charges. However, because by enhancingefficiencythroughthestandardizationofaircrafttypes, is necessaryfortheGrouptoreduceindirectfixedcosts,costs cannot bedenied.Ifsuchcostsincrease,inordertosecureincome,it the costofraisingfunds,andresponsestoenvironmentalregulations transportation operationsduetosuchfactorsasjetfuelexpenses, The possibilityofanincreaseincostsrelatedtotheGroup’sair Risks RelatedtoCompetition if newregulations,suchasenvironmentaltaxes,areintroduced. additional costburdenifcurrentregulationsarestrengthenedor regulations. However,theGroupmayhavetoshoulderalarge considerable costburdeninordertoadheresuchstatutory materials, andenvironmentalpollution.TheGroupshouldersa issues asaircraftnoiseandemissions,theusageofhazardous have introducednumerousstatutoryregulationsaddressingsuch In recentyears,regulatoryauthoritiesinJapanandothercountries Risks RelatedtoEnvironmentalRegulations term downturninaviation demand immediately following an would belargelymetbyaviationinsurance,amedium-to-long- for damages,andotheritems.Althoughsuchdirectexpenses associated withtherepairorreplacementofaircraft,compensation An aircraftaccidentwouldgiverisetosignificantexpenses Aircraft accidents that couldaffecttheGroup’sperformance. competitor couldsimilarlyleadtoareductioninaviationdemand a majoraccidentinvolvingcode-shareflightoreventhatof accident could significantly affecttheGroup’sperformance.Further,

2005, increasesthestringencyrequiredforpropermanagement enactment ofthePersonalInformationProtectionLawonApril1, members (asofMarch31,2007)the customers, suchasthatpertainingtotheapproximately15.75million The Groupholdsahugeamountofinformationrelatingto of CustomerInformation Risks RelatedtoUnauthorizedDisclosure impairment losses inthefuture. deteriorates, theGroupmayberequired torecognizefurtherasset loss of¥10.8billion.However,ifthe profitabilityofvariousoperations In thefiscalyearunderreview, Grouprecordedanextraordinary In April2005,theGroupintroduced assetimpairmentaccounting. Risks RelatedtoAssetImpairment performance. result inalossofpublicconfidence,whichcouldaffecttheGroup’s networks wouldmakeitdifficulttomaintainoperationsand failure ofonethosesystemsorthetelecommunications procedures, operationalcontrol,andmanagement.The systems forsuchcriticalfunctionsasreservationsandsales,boarding Air transportationoperationsarehighlydependentoninformation Risks RelatedtoITSystems closure, whichcouldaffecttheGroup’sperformance. of flightarrivalsanddeparturesatthatairportduringtheperiod of to anearthquake,atyphoon,orsnowwouldleadthesuspension Group’s performance.Further,thelong-termclosureofanairportdue operational controlfunctionsthatcouldsignificantlyaffectthe to along-termshutdownoftheGroup’sinformationsystemsor a disaster,suchasfire,attheabove-mentionedfacilitiescouldlead result, amajordisaster,suchasanearthquake,intheTokyoareaor Group’s passengersondomesticroutesuseHanedaAirport.Asa flights isconductedatHanedaAirport.Further,morethan60%ofthe operational controlforalloftheGroup’sdomesticandinternational The Group’sdatacenterislocatedintheTokyoarea,while Risks RelatedtoDisasters Group’s performance. a lossofpublicconfidence,whichcouldsignificantlyaffectthe factor couldcarrysignificantcost,intermsofbothcompensationand personal informationcausedbyunauthorizedaccessorsomeother measures toensureinformationsecurity.However,amajorleakof of suchpersonalinformation.TheGroupundertakesadequate a situationcouldsignificantlyaffecttheGroup’sperformance. in accordancewithin-houseregulations.Theoccurrenceofsuch the operationofsametypeaircraftisvoluntarilysuspended circular directive,insomecases,wheresafetycannotbeconfirmed, even whenthelawdoesnotrequireissuanceofatechnical permitted untiltheaircraft’ssafetyhasbeenconfirmed.Further, In somecases,operationsofthesametypeaircraftarenot Infrastructure andTransportissuesatechnicalcirculardirective. an aircraft,inaccordancewiththelawMinisterofLand, If anissuearisesthatsignificantlycompromisesthesafetyof Technical circulardirectives ANA MileageClub

. Thefull

41 All Nippon Airways Co., Ltd. Financial Section 42 All Nippon Airways Co., Ltd. Financial Section As of March 31, 2007 and 2006 All Nippon Airways Co., Ltd. and its consolidated subsidiaries Consolidated Balance Sheets

Current assets: ASSETS See accompanyingSee notes to consolidated financial statements. Other assets Deferred income taxes –non-current andequipment Property Investments andlong-term receivables:

Flight equipment Deferred incometaxes –current (Note 8) Inventories andaffiliates subsidiaries Accounts receivable from andadvancesto non-consolidated (¥540millionin2007and¥2442006) Accounts receivable, lessallowance for doubtfulaccounts (Note 4) securities Marketable Cash Construction inprogress Advance payments onaircraft purchase contracts Less accumulateddepreciation Ground propertyandequipment Other long-termreceivables Housing loansto employees Lease deposits andguaranty andaffiliates (Note subsidiaries 5) Investments inandadvancesto non-consolidated (NoteInvestments 4) insecurities Prepaid expensesandothercurrentassets

. Total assets Net propertyandequipment Total investmentsandlong-termreceivables Total currentassets

. . . . (Notes 6 and 9) ...... (Note 8)

. : . . . . .

.

¥ 172,958 ¥1,602,091 1,745,625 1,170,375 (872,709) 422,048 120,499 969,810 872,916 575,250 131,147 2007 56,374 60,736 43,530 35,556 90,952 40,239 21,482 59,442 9,408 2,039 5,942 9,246 738

34 Yen (Millions)

¥1,666,843 ¥ 234,461 1,629,736 1,046,558 (841,944) 530,374 112,593 927,409 136,784 787,792 583,178 123,424 2006 75,619 23,561 57,915 24,645 42,856 42,780 37,713 22,404 53,561 1,580 2,833 2,092 7,654 3,575,163 1,020,745 $1,465,125 $13,571,292 8,215,248 7,394,460 14,787,166 4,872,935 9,914,231 1,110,945 (7,392,706) (Thousands) U.S. dollars (Note 3) 2007 477,544 514,494 368,742 301,194 770,453 340,864 181,974 503,532 79,695 17,272 50,335 78,323 6,252 288

Consolidated Balance Sheets Net assets Shareholders’ Current liabilities: LIABILITIES ANDNETASSETS Totalliabilities andnetassets Totalnetassets Minorityinterestsinconsolidated subsidiaries Commitments andcontingent liabilities Long-term liabilities:

Other currentliabilities Accrued incometaxes Accrued expenses sales Advance ticket Accounts andaffiliates subsidiaries payable to non-consolidated Accounts andnotes payable –trade debt(Note oflong-term 6) loans, includingcurrent portion Short-term Valuation, translation adjustments andothers Other long-termliabilities Deferred (Note incometaxes 8) –non-current Accrued employees’ retirement benefits(Note 7) (NoteLong-term 6) debt,lesscurrent portion Foreign translationadjustments currency Deferred gainonhedging instruments Unrealized holdinggainonsecurities (1,935,975shares atMarch 31,2007and3,211,360shares atMarch 31,2006) atcost commonstock, Less treasury earnings Retained Capital surplus Common stock: Issued –1,949,959,257shares atMarch 31,2007andatMarch 31,2006 3,400,000,000shares atMarch 31,2006 Authorized –3,900,000,000shares at March 31,2007and Total currentliabilities Total long-termliabilities (Notes 8and 10) equity ......

: .

.

. . . (Note 11) ......

¥ 158,724 ¥1,602,091 112,606 590,722 473,034 197,869 405,912 125,739 160,001 364,545 723,145 21,283 39,271 51,043 23,155 10,885 33,678 79,530 18,329 2007 3,369 1,475 7,689 1,488 (362) (725)

Yen (Millions)

¥ 149,438 ¥1,666,843 107,377 696,879 480,848 167,244 353,441 125,605 160,001 337,275 832,554 2006 66,874 40,383 46,135 52,697 26,482 (1,028) 9,258 1,516 7,132 9,410 9,034 1,816 (376) – 5,003,998 4,007,065 1,676,146 $13,571,292 3,438,475 1,065,133 1,355,366 3,088,056 6,125,752 $1,344,549

(Thousands) U.S. dollars (Note 3) 2007 953,884 180,287 332,664 432,385 196,145 285,286 673,698 155,265 28,539 12,495 65,133 92,207 12,605 (3,066) (6,141)

43 All Nippon Airways Co., Ltd. Financial Section 44 All Nippon Airways Co., Ltd. Financial Section Years ended March 31, 2007, 2006 and 2005 All Nippon Airways Co., Ltd. and its consolidated subsidiaries Consolidated Statements ofIncome

Operating expenses: Operating revenues: See accompanyingSee notes to consolidated financial statements. Net incomepershareassumingfull dilution(Note2 Net incomepershare(Note2(m)) Net income Minority interests Income beforeminorityinterests Income taxes Income beforeincometaxesandminorityinterests Non-operating income(expenses): Operating income

Current Flight controlandgroundhandling In-flight services Aircraft maintenance Aircraft andflightoperations Incidental andother Cargo Passenger Deferred Other, net Refurbishment expensesforreturnofleaseaircraft Special retirementbenefitexpenses benefitobligation Amortization ofnettransitionalretirement Gain onsaleofinvestmentsinsecurities Rebate onaircraftpurchases Equity inincome Valuation lossonotherlong-termreceivables Valuation lossoninvestmentsinsecurities Impairment loss(Note15) Loss onsaleordisposalofpropertyandequipment Interest expenses Gain onsaleofpropertyandequipment Interest anddividendincome Other costs Depreciation andamortization General andadministrative Reservations, salesandadvertising ...... (Note8) .

. . . (loss) . . : . . of affiliates ...... (m) . . . ) .

¥ 32,658 ¥1,004,541 1,489,658 1,397,468 236,152 230,327 269,594 385,554 392,348 (41,126) (10,809) (17,708) 2007 88,610 39,831 66,175 81,225 92,769 ¥16.77 33,694 17,370 12,818 51,064 92,190 2007 (6,533) (6,713) (8,402) 1,036 4,552 1,916 1,239 1,073 5,353 (600) (215) 284 (11) – – ¥ 914,306 ¥ 26,722 Yen (Millions) 1,368,792 1,279,990 217,490 214,588 258,018 326,622 369,447 (36,369) (20,451) (10,577) (20,172) 06 2005 2006 76,201 35,516 65,495 86,060 85,039 ¥15.64 25,543 26,890 20,935 52,433 18,632 88,802 06 2005 2006 (1,179) (4,373) (6,712) (1,335) 15.64 5,955 2,051 2,638 4,681 Yen

(751)

– – – ¥ 869,497 ¥ 26,970 1,292,813 1,215,039 217,930 206,031 248,960 302,854 343,712 (16,960) (32,095) (22,115) (21,117) 15,969 70,446 36,708 56,527 75,583 79,604 ¥17.26 28,047 17,632 34,592 45,679 77,774 (5,098) (1,858) (6,712) 15.31 1,344 1,581 5,418 1,077 (485) 881 97 – – 2,000,440 750,614 337,408 1,951,097 2,283,727 560,568 688,056 3,266,023 12,618,873 3,323,574 785,845 $ $0.142 $276,645 285,421 147,141 108,581 432,562 16,230 (55,341) 10,496 (91,563) 45,345 780,940 11,837,933 38,560 (348,378) (5,083) (56,866) (1,821) (71,173) (150,004) (Thousands)

U.S. dollars U.S. dollars 8,509,454 (Note 3) (Note 3) 2007 2007 8,776 2,406 9,089 (93)

– –

Years ended March 31, 2007, 2006 and 2005 All Nippon Airways Co., Ltd. and its consolidated subsidiaries Consolidated Statements ofChanges inNetAssets

Balance atMarch31,2006 Balance atMarch31,2007 Total changesduringtheperiod duringtheperiod Balance atMarch31,2006 Total changesduringtheperiod Balance atMarch31,2005 Total changesduringtheperiod Balance atMarch31,2004 See accompanyingSee notes to consolidated financialstatements. Balance atMarch 31, 2007 Total changesduring theperiod

duringtheperiod thanshareholders’equity Net changesofitemsother oftheequitymethod consolidationandapplication Changes inscopeof Disposition oftreasurystock Purchase oftreasurystock Net income Cash dividendspaid duringtheperiod thanshareholders’equity Net changesofitemsother oftheequitymethod consolidationandapplication Changes inscopeof Disposition oftreasurystock Purchase oftreasurystock Net income thanshareholders’equity Net changesofitemsother oftheequitymethod consolidationandapplication Changes inscopeof Disposition oftreasurystock Purchase oftreasurystock Net income Cash dividendspaid thirdparty offeringandallocationto Issuance ofstockbypublic ofstockacquisitionrights Issuance of stock by execution Cash dividendspaid duringtheperiod thanshareholders’equity Net changesofitemsother oftheequitymethod consolidationandapplication Changes inscopeof Disposition oftreasurystock Purchase oftreasurystock Net income Cash dividendspaid ofstockacquisitionrights Issuance of stock by execution Conversion ofconvertiblebonds ......

¥86,767 13536 10513 6368 (,4) 30806 9,0 $9,4 $306 $8,8 $65,133 $285,286 $(3,066) $196,145 $92,207 $3,088,056 $(6,141) $673,698 $1,065,133 $1,355,366 ,8 ¥405,912 ¥ 7,689 ¥33,678 (362) ¥ ¥23,155 ¥10,885 ¥364,545 ¥(725) ¥79,530 ¥125,739 ¥160,001 $1,355,366 Common Common (Note 10) (Note 10) 160,001 107,292 48,500 52,709 20,525 15,791 stock stock 4,208 4,733

3 2,3 33 720 ,7 2,5 1 2,4 57 52,471 557 24,644 14 23,155 1,475 27,270 303 26,833 134 – ,3 2732 ,6 2104 245 9,4 19 0,5 478 444,481 4,718 208,759 119 196,145 12,495 231,004 2,567 227,302 1,135 – ¥ 53,114 $1,063,998 (Note 10) 125,605 surplus Capital (Note 10) 48,130 51,929 73,676 20,562 15,791 surplus Capital 4,208 4,733 (410) 3 64 4 748 748 614 134 ,3 521 ,3 6,336 6,336 5,201 1,135 37

Shareholders’ equity Shareholders’ equity

4,6) 4,6) (49,462) (49,462) (49,462) ¥ 8,882 (Note 10) Retained Retained earnings $446,396 268 268 32,658 32,658 32,658 26,722 52,697 21,472 31,225 22,343 26,970 589 (,3) (5,839) (5,839) (5,839) 7,4 2665 276,645 276,645 276,645 (Note 10) (5,010) (4,611) Retained Retained earnings (240) (16) 4 4 14 14 14 1 19 119 119 119

stock, atcost stock, Less treasury Less treasury ¥ (790) stock, atcost stock, common Less treasury Less treasury (1,028) $(8,708) common 264 (,3) (2,634) (2,634) (2,634) 31 (1) (311) (311) (311) (260) (171) (857) (333) 266 (67) 89 shareholders’ ¥ 147,973 $2,857,052 shareholders’ 337,275 125,939 211,336 equity 26,722 96,630 63,363 31,582 26,970 Total equity (5,010) (4,611) Total 8,416 9,466 (240) (321) (260) (333) 303 (16)

U.S. dollars (Thousands) (Note 3) U.S. dollars(Thousands)

¥ 4,040 unrealized securities holding gain on unrealized $79,712 ,7 ¥315 4 464 5 25,201 557 24,644 14 ¥23,155 1,475 Yen (Millions) securities 4,790 9,410 4,790 4,620 Net 245 1615 1 2879 ,1 213,477 4,718 208,759 119 $196,145 12,495 holding gain on 580 580 Net Valuation, translationadjustmentsandothers Valuation, translationadjustmentsandothers

instruments instruments Deferred hedging gain on Deferred hedging gain on

adjustments adjustments translation translation ¥(1,927) $(3,185) currency currency currency currency Foreign Foreign (1,672) 1,296 1,296 (376) 255 255 $ 76,527 adjustments adjustments and others translation and others ¥ 2,113 translation valuation, valuation, Total Total 6,086 9,034 6,086 2,948 835 835

consolidated consolidated subsidiaries subsidiaries interests in interests in $60,415 ¥ 8,910 Minority Minority Minority Minority 10,217 (3,085) (3,085) 7,132 1,307 1,307 $3,438,475 $2,993,944

¥158,996 netassets 128,940 353,441 224,501 net assets 26,722 96,630 65,505 31,582 26,970 (5,010) (4,611) Total Total 3,001 8,416 2,142 9,466 (240) (321) (260) (333) 303 (16)

45 All Nippon Airways Co., Ltd. Financial Section 46 All Nippon Airways Co., Ltd. Financial Section Years ended March 31, 2007, 2006 and 2005 All Nippon Airways Co., Ltd. and its consolidated subsidiaries Consolidated Statements ofCash Flows Cash flowsfromoperatingactivities: See accompanyingSee notes to consolidated financialstatements. Cash andcashequivalents atendofyear changesinscope ofconsolidation Net increase(decrease)resulting from Cash andcashequivalentsatbeginning ofyear Net (decrease)increaseincash and cashequivalents Effect ofexchangeratechanges oncashandequivalents Cash flowsfromfinancingactivities: Cash flowsfrominvestingactivities:

minorityintereststonetcashprovidedbyoperatingactivities: Adjustments toreconcileincomebeforetaxesand Income beforeincometaxesandminorityinterests Other, net andallocationtothirdparty Proceeds fromissuanceofstockbypublicoffering Payment fordividends Repayment ofbonds Proceeds fromissuanceofbonds Repayment oflong-termdebt Proceeds fromlong-termdebt Decrease inshort-termloans,net Other, net inscopeofconsolidation Proceeds fromsaleofsubsidiary’sstockwithchanges Proceeds fromcollectionofadvances Payment ofadvances Proceeds fromsaleofinvestmentsinsecurities Proceeds fromredemptionofmarketablesecurities Payment forpurchaseofmarketablesecurities Payment forpurchaseofintangibleassets Proceeds fromsaleofpropertyandequipment Payment forpurchaseofpropertyandequipment Other, net Receipt ofrebateonpurchasingaircraft Income taxespaid Interest paid Interest anddividendsreceived Cash generatedfromoperations Interest expenses Increase (decrease)inaccruedemployees’retirementbenefits Increase (decrease)inallowancefordoubtfulaccounts Loss ondisposalandsaleofpropertyequipment Impairment loss Depreciation andamortization Other, net Increase inaccountsandnotespayable–trade (Increase) decreaseinothercurrentassets (Increase) decreaseinaccountsreceivable Rebate onpurchasingaircraft Exchange gain Interest anddividendincome Net cashusedinfinancingactivities Net cashusedininvestingactivities Net cashprovidedbyoperatingactivities ...... (Note 14) ......

. . . . .

¥ ¥ (100,897) (113,809) (128,298) (236,750)

172,274 242,785 104,900 158,714 191,908 (10,620) (70,540) (75,000) (15,176) (20,197) (17,787) 2007 28,389 17,708 10,809 88,610 51,064 97,158 21,410 (1,165) (5,353) (5,839) (5,190) (2,267) (2,416) (5,995) 5,241 7,533 1,783 1,375 5,606 1,015 5,390 (348) (600) (233) 273 (59) 29 – – – – Yen (Millions) ¥ 242,785 ¥ 52,433 (163,141) (218,278) 163,155 125,392 128,525 195,884 (40,000) (46,449) (17,302) (47,201) (20,511) 06 2005 2006 28,417 20,172 20,451 76,201 79,456 95,865 34,813 84,278 12,219 49,574 11,282 (4,681) (4,403) (3,137) (2,587) (5,010) (7,355) (7,808) (1,528) (4,373) (3,673) 4,726 3,007 7,939

(408) 520 174 517 (91) – – – – ¥ 163,155 ¥ 45,679 (109,975) (169,247) (199,650) 126,028 234,524 149,070 151,945 (15,969) (11,782) (10,530) (21,166) (71,357) (51,600) (74,300) 15,969 20,534 17,958 21,117 70,446 19,895 39,505 (3,336) (5,418) (4,611) (9,038) (5,554) 5,468 2,228 4,537 2,524 5,093 3,629 (546) (468) (635) 420 401 190 (12) – – – – – 240,483 150,004 44,396 63,812 91,563 750,614 $ $1,459,331 2,056,629 15,104 823,024 11,648 47,488 181,364 (50,784) 888,607 (5,083) 1,344,464 45,659 (1,973) 1,625,650 (9,869) (89,962) (2,948) (45,345) (597,544) (854,697) (49,462) (635,324) (964,075) (43,964) (19,204) (1,086,811) (20,466) (128,556) (2,005,506) (171,089) (150,673) (Thousands)

U.S. dollars (Note 3) 432,562 2007 2,313 8,598 (500) 246

– – – –

Deferredtaxaccounting (b) (a) Summary 2. Basis 1. All Nippon Airways Co., Ltd. and its consolidated subsidiaries

Notes to Consolidated Financial Statements in non-consolidatedsubsidiariesandaffiliates Deferred incometaxesareaccountedforundertheassetand The consolidatedfinancialstatementsincludetheaccountsof Principles ofconsolidationandaccountingforinvestments The accompanyingconsolidatedfinancialstatementsof measured usingenactedtaxrates expectedtoapplytaxable tax creditscarriedforward.Deferred taxassetsandliabilitiesare assets andliabilitiestheirtax basesandoperatinglosses between thefinancialstatement carryingamountsofexisting for thefuturetaxconsequencesattributabletodifferences liability method.Deferredtaxassetsandliabilitiesarerecognized transactions, ifany,aremadeonconsolidation. December 31andnecessaryadjustmentsforsignificant financial statementsforprioryearshavenotbeenrestated. charged toretainedearnings(deficit)andtheconsolidated changes inthescopeofconsolidationhasbeencreditedor in prioryearswereincludedconsolidation.Theeffectof companies wasnotsignificant. stated atcost.Theequityinundistributedearningsofthese for 2007,49companies2006and542005)are accounted for by the equity method of accounting (52 companies period offiveyears. of accountingisamortizedusingthestraight-linemethodovera subsidiaries andcompaniesaccountedforbytheequitymethod in thenetassetsatdatesofacquisitionconsolidated The differencebetweenthecostandunderlyingnetequity for 2005)areaccountedbytheequitymethodofaccounting. (25 companies for 2007, 23 companies for 2006 and 22 companies been eliminatedinconsolidation. All significantintercompanyaccountsandtransactionshave for 2007,98subsidiaries2006and962005). the Companyandallofitssignificantsubsidiaries(95 Company asrequiredbytheSecuritiesandExchangeLawof from theconsolidatedfinancialstatementspreparedby International FinancialReportingStandards,andarecompiled respects astoapplicationanddisclosurerequirementsof generally acceptedinJapan,whicharedifferentcertain subsidiaries arepreparedonthebasisofaccountingprinciples All NipponAirwaysCo.,Ltd.(the“Company”)anditsconsolidated Certain foreignsubsidiarieshavefiscalyearsendingon During 2007 and 2005, subsidiaries which were not consolidated Investments innon-consolidatedsubsidiariesandaffiliatesnot Investments incertainsubsidiariesandsignificantaffiliates of presenting of significant consolidated accounting financial policies statements

Marketablesecuritiesandinvestment (d) Foreigncurrencytranslation (c)

The accountingstandardforfinancialinstrumentsrequiresthat The balancesheetaccountsofforeignconsolidatedsubsidiaries See Note8. operations intheperiodthatincludesenactmentdate. assets andliabilitiesofachangeintaxratesischargedto expected toberecoveredorsettled.Theeffectondeferredtax income intheyearswhichtemporarydifferencesare herein asadditionalinformation. and practicesgenerallyacceptedinJapanbutispresented information whichisnotrequiredunderaccountingprinciples the notestoconsolidatedfinancialstatementsinclude form whichismorefamiliartoreadersoutsideJapan.Inaddition, statements issueddomesticallyinordertopresentthema certain reclassificationshavebeenmadetothefinancial Japan. Inpreparingtheaccompanyingfinancialstatements, by themovingaveragemethod.SeeNote4. securities arecarriedatcost.Costofsoldisdetermined in netassets.Non-marketablesecuritiesclassifiedasother or losses,netoftheapplicableincometaxes,includeddirectly are carriedatfairvaluewithchangesinunrealizedholdinggains at amortized cost. Marketable securities classified as other securities are carriedatfairvalueandheld-to-maturitysecurities maturity or other securities. Under the standard, trading securities securities beclassifiedintothreecategories:trading,held-to- forward exchangecontracts. date, exceptpayablesandreceivableshedgedbyqualified translated attherateofexchangeineffectbalancesheet of theconsolidatedbalancesheets. currency translationadjustmentsunderthenetassetssection differences arerecordedinminorityinterestsandforeign when suchtransactionsaremade.Resultingtranslation and expensesaretranslatedattheratesofexchangeprevailing equity whicharetranslatedathistoricexchangerates.Revenues balance sheetdate,exceptforcomponentsofshareholders’ are translatedintoyenattheratesofexchangeineffect Foreign currencypayablesandreceivablesareprincipally

47 All Nippon Airways Co., Ltd. Financial Section 48 All Nippon Airways Co., Ltd. Financial Section

Propertyandequipmentdepreciation (h) Inventories (g) Allowancefordoubtfulreceivables (f) Derivatives (e)

Property andequipmentarestatedatcostlessaccumulated Inventories includeaircraftspareparts,suppliesandstockin A generalprovisionismadefordoubtfulreceivablesbasedon The Companyanditssubsidiariesusederivatives,suchas commodity optionsandswaps,tolimittheirexposure forward foreignexchangecontracts,interestrateswapsand by ¥6,410million ($54,299thousand)forthefiscal yearended income andbefore taxesandminorityinterests of thesenewusefullives,depreciation decreasedoperating determined tosellinthenearfuture. Asaresultoftheadoption estimated usefullivestocertainaircraft whichtheCompany durability ofsuchaircraft: following usefullives,basedupontheCompany’sestimated methods: computed basedonestimatedusefullivesbythefollowing depreciation. Depreciationofpropertyandequipmentis method formiscellaneoussupplies. average methodforaircraftsparepartsandthefirst-in,first-out trade ofconsolidatedsubsidiaries. receivables asandwhenrequired. past experience.Provisionsarealsomadeagainstspecific is recognizedandincludedininterestexpensesorincome. but thedifferentialpaidorreceivedunderswapagreements that qualifyforhedgeaccountingarenotmeasuredatfairvalue, corresponding foreign exchange contract rates. Interest rate swaps by qualifiedforwardexchangecontractsaretranslatedatthe deferred as an asset or a liability. Receivables and payables hedged hedge accountingunderwhichanunrealizedgainorlossis operations, exceptforthosewhichmeetthecriteriadeferral changes inunrealizedgainsorlosseschargedcreditedto use derivativesfortradingpurposes. commodity prices.TheCompanyanditssubsidiariesdonot fluctuations inforeignexchangerates,interestratesand andequipment Other flightequipment Other groundproperty The Companyandcertainsubsidiariesemployprincipallythe Buildings International typeequipment Boeing767s,737s,AirbusA320s Boeing 747-400s,777s, These arestatedatcost.Costisdeterminedbythemoving Derivative financialinstrumentsarecarriedatfairvaluewith In addition,effectiveApril1,2006, theCompanyadoptednew Domestic typeequipment and Airbus A321s ......

Decliningbalancemethod Straight-line method Straight-line method Declining balancemethod 17 years 20 years

Retirementbenefits (j) Intangibleassetsandamortization (i) planassets Expected return on Discount rate :

The retirementbenefitplanoftheCompanyandcertain Intangible assetsincludedinotherareamortizedbythe earlier voluntaryseverance,tolump-sumpaymentsorannuity eligible employeesareentitled,uponmandatoryretirementor officers andcorporateauditors.Underthetermsofthisplan, subsidiaries covers substantially all employees other than directors, estimated usefullifeofpurchasedsoftware. is amortizedbythestraight-linemethodoverfiveyears, straight-line method.Costofsoftwarepurchasedforinternaluse improvements, arechargedtoincomeasincurred. Maintenance andrepairs,includingminorrenewals under thepreviousmethod. March 31,2007ascomparedwiththecorrespondingamount March 31,2007,2006and2005are asfollows: remaining serviceyearsofemployees. SeeNote7. through eighteenyears)whichareshorterthantheaverage the straight-linemethodoverperiods(principallyeightyears of employees. Prior servicecostisbeingamortizedasincurredby years) whichare shorter than the average remaining service years method overperiods(principallyeightyearsthrougheighteen which thegainorlossisrecognizedprimarilybystraight-line gains andlossesareamortizedintheyearfollowing period offifteenyearsbythestraight-linemethod.Actuarial obligation attransitionisbeingamortizedprincipallyovera service yearsofeligibleemployees.Thenetretirementbenefit each periodbythestraight-linemethodoverestimated service cost.Theretirementbenefitobligationisattributedto unrecognized actuarialgainsorlossesandprior for unrecognizednetretirementbenefitobligationattransition, the pensionplanassetsasofbalancesheetdate,adjusted on theretirementbenefitobligationandfairmarketvalueof sheet dateareprovidedmainlyatanamountcalculatedbased pension plans. defined contributionpensionplansaswellbenefit cover allorpartofthelump-sumbenefits. part ofthelump-sumbenefitsorannuitypayments. have trusteeemployeepensionfundstoprovidecoveragefor and yearsofservicewiththeCompanysubsidiaries. payments basedontheircompensationatthetimeofleaving Major additionsandimprovementsarecapitalizedatcost. The assumptionsusedinaccounting fortheaboveplansasof Accrued retirementbenefitsforemployeesatthebalance The Companyandcertainconsolidatedsubsidiariesadopt Several subsidiarieshavetax-qualifiedpensionplanswhich The Companyandcertainsignificantdomesticsubsidiaries . .

0.85%~5.5% 2.5% 2007 06 2005 2006 .% 2.5% 2.5% .5~.% 0.85%~5.5% 0.85%~5.5% Reclassification (r) Cashequivalents (q) Bondissuancecosts (p) Stockissuancecosts (o) Leases (n) incomepershare (m) Net Appropriationofretainedearnings (l) Revenuerecognition (k)

Certain reclassificationshavebeen madetothe2006and2005 For thepurposeofstatementscashflows,andshort- Bond issuancecostsareprincipallycapitalizedandamortized Stock issuancecostsareprincipallycapitalizedandamortized Finance leasetransactionsotherthanthosethatareexpectedto The computationofnetincomepersharecommonstockis Under the Corporation Law of Japan (the “Law”), the appropriation Passenger revenues,cargoandotheroperatingrevenuesare to conformwiththe2007presentation. financial informationintheaccompanying financialstatements or lessaretreatedascashequivalents.SeeNote14. term, highlyliquidinvestmentswithamaturityofthreemonths over aperiodofthreeyears. over aperiodofthreeyears. as operatingleases.SeeNote9. transfer ownershipoftheassetstolesseeareaccountedfor previous yearhadbeenapplied. been ¥192.54($1.63)ifthesamecalculationmethodin to commonstock. was includedinthenetassetsasofMarch31,2007attributable the amountofdeferredgainonhedginginstruments,nettax, the AccountingStandardsBoardofJapanonJanuary31,2006), Accounting StandardImplementationGuidelinesNo.4issuedby Accounting StandardsforNetIncomeperShare”(Financial during eachyear. based ontheweightedaveragenumberofsharesoutstanding not thereforereflectsuchappropriation.SeeNote10. close ofthefinancialperiodandaccountsforthatdo shareholders atageneralmeetingtobeheldsubsequentthe to afinancialperiodismadebyresolutionoftheCompany’s of unappropriated retained earnings of the Company with respect recorded whenservicesarerendered. The netassetspershareasofMarch31,2007wouldhave As aresultofrevision“ImplementationGuidelinesfor Impairmentlossonfixedassets (s) Businesscombination anddivestitures (u) Presentationofnetassetsinthebalancesheet (t) Effective April1,2005,theCompanyanditsdomesticsubsidiaries  Effective theyearendedMarch31,2007,Companyand Concerning ConsolidatedFinancialStatements.SeeNote15. fixed assetsinaccordancewiththerevisedRegulations losses arededucteddirectlyfromthebalancesofrelated the fiscalyearendedMarch31,2007.Accumulatedimpairment March 31,2006andby¥10,809million($91,563thousand)for minority interestsby¥20,451millionforthefiscalyearended impairment lossdecreasedincomebeforetaxesand Standards BoardofJapanonOctober31,2003).Asaresult, Implementation GuidelinesNo.6issuedbytheAccounting Impairment ofFixedAssets”(FinancialAccountingStandard “Implementation GuidelinesforAccountingStandards Accounting CouncilofJapanonAugust9,2002)andthe Standards forImpairmentofFixedAssets”issuedbytheBusiness Fixed Assets”(“OpinionConcerningEstablishmentofAccounting and affiliatesapplied“AccountingStandardsforImpairmentof Japan onDecember22,2006). Guidelines No.10issuedbytheAccounting StandardsBoardof and Divestitures” (Financial Accounting Standard Implementation Guidelines forAccountingStandards forBusinessCombination of JapanonDecember27,2005) and the“Implementation Business Divestitures”issuedbytheAccountingStandardsBoard for BusinessDivestitures”(“AccountingStandardsNo.7 Council ofJapanonOctober31,2003),“AccountingStandards for BusinessCombination”issuedbytheAccounting Standards forBusinessCombinations”(“Accounting its domesticsubsidiariesandaffiliatesapplied“Accounting Effective theyearendedMarch31,2007,Companyand financial statementsasofandfortheyearendedMarch31,2007. conform tothepresentationanddisclosureofconsolidated the yearsendedMarch31,2006and2005havebeenrestatedto 2006 andtheconsolidatedstatementsofshareholders’equityfor In this connection, the consolidated balance sheet as of March 31, shareholders’ equityeffectivetheyearendedMarch31,2007. has beenrequiredinsteadofaconsolidatedstatement preparation ofaconsolidatedstatementchangesinnetassets Standards BoardofJapanonDecember9,2005).Inaddition, Implementation GuidelinesNo.8issuedbytheAccounting Assets intheBalanceSheet”(FinancialAccountingStandard Guidelines forAccountingStandardsPresentationofNet of JapanonDecember9,2005)andthe“Implementation the BalanceSheet”issuedbyAccountingStandardsBoard (“Accounting StandardsNo.5forPresentationofNetAssetsin Standards forPresentationofNetAssetsintheBalanceSheet” its domesticsubsidiariesandaffiliatesapplied“Accounting

49 All Nippon Airways Co., Ltd. Financial Section 50 All Nippon Airways Co., Ltd. Financial Section Loss onsale Gain onsale Proceeds Net unrealizedgain Gross unrealized loss: Gross unrealized gain: Net unrealizedgain Gross unrealized loss: Gross unrealized gain: Marketable 4. Financial 3.

Market value Cost Market value Cost Market value Cost Market value Cost Market valueinformationatMarch31,2007and2006issummarizedasfollows: The consolidatedfinancialstatementspresentedhereinare ¥118.05=US$1, theapproximateexchangerateprevailingon have beentranslatedintoUnitedStatesdollarsattherateof expressed inyenand,solelyfortheconvenienceofreader, Other securitiessoldintheyearsendedMarch31,2007,2006and 2005areasfollows: Other securitieshavingmarketvalueareasfollows: Held-to-maturity securitieshavingmarketvalueareasfollows: ...... statements ...... securities . . translation and investments in securities

2007 ¥ 323 464 at suchrate. amounts showncouldbeconvertedintoUnitedStatesdollars translation shouldnotbeconstruedasarepresentationthatthe the TokyoForeignExchangeMarketonMarch30,2007.This 1

Yen (Millions) ¥18,804 ¥14,857 18,969 33,826 2007 2006 3,227 3,392 2007 ¥228 (165) ¥ 3 ¥ 0

(0)

3 5 5 0 – 8

Yen (Millions)

Yen (Millions)

¥14,369 ¥16,488

16,529 30,898 ¥1,778 2006 2005 2006 1,096 446 ¥38 405 878 ¥ 0 ( 41) 38 – – – 0

(Thousands) U.S. dollars (Thousands) (Thousands) $159,288 $125,853 U.S. dollars U.S. dollars 160,686 286,539 2007 $3,931 27,336 28,734 2007 2007 (1,398) 2,736 $25 $ 42 42 25 (0) 8 0 0

Total: Others: Bonds: Other securities bonds Held-to-maturity

Current portionofbondsandnotes loans oflong-term Current portion bankloans Short-term Short-term 6. Advances Investments incapitalstock Investments 5.

Over 1yearto5years Within 1year Within 1year 1year toOver 5years Within 1year as follows: Short-term loansatMarch31,2007and2006consistedofthefollowing: Investments inandadvancestonon-consolidatedsubsidiariesaffiliates atMarch31,2007and2006consistedofthefollowing: The redemptionscheduleofothersecuritiesandheld-to-maturity debtsecuritiesasofMarch31,2007and2006issummarized Breakdown ofsecuritiesnothavingmarketvalueatMarch31,2007and2006isasfollows: . . . . . loans in and . . . . and advances . long-term . . to non-consolidated debt subsidiaries and affiliates

¥ 3,500 ¥158,724 ¥ – ¥22,415 110,224 22,415 45,000 ¥9,246 ¥8,916 2007 2007 2007 2007 ¥34 330 ¥ 29

5

3 3 Yen (Millions) Yen (Millions) Yen (Millions)

Yen (Millions)

¥149,438 ¥ 8,690 ¥23,415 ¥46,865 ¥15,416 ¥24,645 2006 31,449 ¥ ¥7,293 45,000 95,748 2006 2006 2006 1,230 7,654 361 38 38

$ 29,648 $1,344,549 (Thousands) (Thousands) (Thousands) (Thousands) U.S. dollars U.S. dollars U.S. dollars U.S. dollars $189,877 $ –

189,877 381,194 933,706 $ $75,527 2007 2007 2007 2007 78,323 2,795 $288 42 $ 246 25 25

51 All Nippon Airways Co., Ltd. Financial Section 52 All Nippon Airways Co., Ltd. Financial Section

(*1) Decreased by debtassumptioncontracts Less currentportion Loans, from principally banks: andnotes:Bonds

Unsecured, interest bearing from 0.93%to 6.90%in2007and Secured, interest bearing from 0.85%to 6.80%in2007and 0.86% notes due2008 1.97 2.09% notes due2014 1.44% notes due2011 2.27% notes due2014 0.8% notes due2006 1.7% notes due2011 1.27% notes due2009 1.5% notes due2008( 1.33% notes due2008 3% notes due 2010 3% notes due 2011 2.05% notes due2006 3% notes due2007 2.9% notes due2008( 3.2% notes due2017 2.75% notes due2009 3.075% notes due2007 such obligationsduetothebank. and certainotherspecifiedevents, tooffsetcashdepositsagainst right, astheobligationbecomes due, orintheeventofdefault given uponrequestofthebank,andthatbankshallhave and guaranteesforfuturepresentindebtednesswillbe are madeundergeneralagreementswhichprovidethatsecurity in 2006. 0.64% to6.10%in2006,maturinginstallmentsthrough2016 ininstallmentsthrough0.85% to 6.90% in2006,maturing 2022 % As iscustomaryinJapan,short-termandlong-termbankloans The interestratesontheshort-termloanswerebetween0.08%and 1.66%perannumin2007andbetween0.08%1.63% Long-term debtatMarch31,2007and2006consistedofthefollowing: notes due 2015 ...... * * ...... 1) 1) . . . . .

under thisagreement. There werenoloanspayableoutstanding atMarch31,2007 balance offundsandtoimprove itsconsolidatedbalancesheet. ¥100,000 million($847,099thousand) toreduceitssurplus with asyndicateof15majorJapanesebanksamountingto guaranteed bydomesticandforeignbanks. Certain bondsandnotesforeigncurrencyloansare The Companyhasconcludedacommitmentlineagreement

¥590,722 ¥ 35,000 155,224 745,946 535,946 166,687 369,259 210,000 2007 20,000 10,000 10,000 10,000 20,000 20,000 20,000 15,000 10,000 10,000 10,000 10,000 10,000

Yen (Millions) – – – –

¥696,879 ¥ 35,000 140,748 837,627 552,627 214,549 338,078 285,000 2006 10,000 20,000 10,000 10,000 15,000 10,000 20,000 20,000 20,000 20,000 15,000 10,000 10,000 10,000 30,000 10,000 10,000 $5,003,998 $ (Thousands) U.S. dollars 1,314,900 6,318,899 4,539,992 1,412,003 3,127,988 1,778,907

169,420 127,065 169,420 169,420 169,420 296,485 2007 84,710 84,710 84,710 84,710 84,710 84,710 84,710 84,710 – – – –

Retirement 7. 201 20 200 200 Property andequipment,atnetbookvalue: Year endingMarch 31, Ground propertyandequipment Flight equipment 10 1 9 8 The Companyanditsdomesticconsolidatedsubsidiarieshave conditions underwhichterminationoccurs. reference totheirbasicratesofpay,lengthserviceandthe annuity payments,theamountsofwhicharedeterminedby substantially allemployeeswhoareentitledtolump-sumor qualified pensionplansandlump-sumpaymentplans,covering defined benefitplans,i.e.,welfarepensionfundtax andthereafter . . . The aggregateannualmaturitiesoflong-termdebtafterMarch31, 2007areasfollows: The followingassetswerepledgedascollateralforshort-termand long-termdebtatMarch31,2007: benefit . . plans .

of Health,LabourandWelfareonMay1,2005. past employeeservicesandreceivedapprovalfromtheMinister for anexemptionfromthepaymentofbenefitsrelatedto October 1,2004,andadomesticconsolidatedsubsidiaryapplied approvals fromtheMinisterofHealth,LabourandWelfareon of thebenefitsrelatedtopastemployeeservicesandreceived The Companyappliedforanexemptionfromthepayment

Yen (Millions) Yen (Millions) ¥ ¥ ¥ ¥ 745,946 380,712 116,584 155,224 595,050 545,601 93,426 49,449

$ $ $ $ (Thousands) (Thousands) U.S. dollars U.S. dollars 6,318,899 3,225,006 1,314,900 5,040,661 4,621,779 791,410 987,582 418,882

53 All Nippon Airways Co., Ltd. Financial Section 54 All Nippon Airways Co., Ltd. Financial Section Accrued employees’retirementbenefits Prepaid pensioncost Unrecognized priorservicecost Unrecognized loss actuarial Unrecognized nettransitionalretirement benefitobligation Unfunded retirement benefitobligation Plan assetsatfairvalue Retirement benefitobligation Net periodicpensionandseverancecost Amortization ofpriorservicecost Amortization ofactuarialloss Amortization ofnettransitionalretirementbenefitobligation Expected returnonplanassets Interest cost Service cost

above table. as ofMarch31,2007and2006fortheCompanyconsolidatedsubsidiaries’ definedbenefitplans: benefit were¥608million($5,150thousand)and¥600 defined contributionplanandforsupplementalretirement the costsforotherretirementandpensionplanssuchasa The followingtablesetsoutthefundedandaccruedstatusof plansandtheamountsrecognizedinconsolidatedbalancesheets The governmentsponsoredportionofthebenefitsunderwelfare pensionfundplanshasbeenincludedintheamountsshown The componentsofretirementbenefitexpensesfortheyearsended March31,2007,2006and2005areasfollows: Besides theabovenetperiodicpensionandseverancecost, ......

¥19,634 ¥10,953 (3,739) (4,369) 2007 3,650 6,713 6,426 respectively, fortheyearendedMarch31,2005. ended March31,2006and¥608million¥1,858million, 2007, ¥568millionand¥4,373million,respectively,fortheyear ($5,083 thousand),respectively,fortheyearendedMarch31,

¥(112,606) ¥(278,278) (111,578) (160,088) Yen (Millions) 118,190 1,028 ¥20,591 ¥12,225 (29,014) 2007 23,826 53,698 (3,715) (4,952) 2006 4,071 6,712 6,250

Yen (Millions)

¥(107,377) ¥(269,868) (106,363) (158,929) 110,939 ¥21,278 ¥11,947 (32,361) 2006 24,497 60,430 (3,090) (3,671) 1,014 2005 3,213 6,712 6,167 1,001,186 $166,319 $ $ (945,176) (245,778) (1,356,103) $(2,357,289)

(953,884) (Thousands) U.S. dollars (Thousands) U.S. dollars

201,830 454,875 (31,673) (37,010) 2007 2007 30,919 56,866 54,435 92,782 8,708

Effective income taxrate Reconciliation: taxrate Statutory Deferred taxliabilities: Deferred taxassets: Income 8. Other Other Inhabitants tax per capita levy taxpercapitalevy Inhabitants Change invaluationallowance andrelated adjustments Entertainment expensesnotqualifying for deduction Entertainment Other Special depreciation reserve Unrealized holdinggainonsecurities Other Allowance for doubtfulaccounts Accrued taxes enterprise Valuation lossoninvestments insecurities Tax losscarry-forward loss Impairment Intercompany profits andequipment oninventories andproperty Accrued expenses Unrealized gainonderivativefinancialinstruments Accrued employees’ retirement benefits is asfollows: 2006 isasfollows: The Companyissubjecttoanumberoftaxesonincome 2007 and2006. aggregate resultedinanormalstatutorytaxrateof40.16% (corporation tax,inhabitantstaxesandenterprisetax)whichin Net deferredtaxassets Total grossdeferredtaxliabilities Total netdeferredtaxassets Less valuationallowance Total gross deferred taxassets A reconciliationofthedifferencebetweenstatutorytaxrate and theeffectiveincometaxrateforyearendedMarch31,2007 The taxeffectoftemporarydifferencesthatgiverisetoasignificant portionofthedeferredtaxassetsandliabilitiesatMarch31,2007 .. . . taxes ......

qualified, wholly-owneddomesticsubsidiaries. taxation systempurposes,theCompanyhasconsolidatedall effective fromtheyearendedMarch31,2003.Forconsolidated The Companyadoptedtheconsolidatedtaxationsystem

¥ 44,543 ¥ 43,470 (25,891) (15,521) 69,361 77,972 12,536 2007 (2,729) (7,641) (8,611) 3,671 5,428 7,203 1,048 2,306 608 629

– Yen (Millions)

¥ 42,209 ¥ 64,525 (10,454) 2006 11,780 74,979 84,003 11,157 (2,716) (6,754) (9,024) 3,908 5,311 5,751 1,162 2,725 (984) – – $377,323 $368,234 (131,478) (219,322)

(Thousands) U.S. dollars 587,556 660,500 106,192 (23,117) (64,727) (72,944) 2007 31,097 45,981 61,017 19,534 34.02% 40.16% (2.80) (5.80) 5,150 5,328 8,878 2.01 0.45

55 All Nippon Airways Co., Ltd. Financial Section 56 All Nippon Airways Co., Ltd. Financial Section

Long-term financeleaseobligations offinanceleaseobligations Current portion Total: Others: Aircraft: Financeleases (a) Leases 9. Effective incometaxrate Reconciliation: taxrate Statutory Other Other Inhabitants tax per capita levy taxpercapitalevy Inhabitants Change invaluationallowance andrelated adjustments Estimated netbookvalue Estimated amountofaccumulateddepreciation Estimated acquisitioncost Estimated netbookvalue Estimated amountofaccumulateddepreciation Estimated acquisitioncost Estimated netbookvalue Estimated amountofaccumulateddepreciation Estimated acquisitioncost expensesnotqualifyingfor deduction Entertainment Finance lease transactions other than those that are expected to transfer ownership of the assets to the lessee are accounted for as opera leases. Informationonfinanceleaseswhicharenotrecordedasassetsand liabilitiesinthebalancesheetsissummarizedbelow. is asfollows: Outstanding financeleaseobligationsatMarch31,2007and2006 areasfollows: Estimated acquisition costs, accumulated depreciation and net book value of leased assets at March 31, 2007 and 2006 are as follows: A reconciliationofthedifferencebetweenstatutorytaxrate and theeffectiveincometaxrateforyearendedMarch31,2006 ......

¥223,363 ¥ 93,621 ¥97,510 ¥23,169 145,107 238,728 138,153 74,341 15,365 85,210 2007 2007 8,411 6,954

Yen (Millions) Yen (Millions)

¥114,022 ¥108,846 ¥278,217 ¥ 26,879 181,059 289,905 103,607 174,610 2006 87,143 11,688 2006 5,239 6,449 $826,005 $196,264 $793,062 1,229,199 2,022,261 1,170,292 $1,892,105

(Thousands) (Thousands) U.S. dollars U.S. dollars 629,741 130,156 721,813 2007 2007 71,249 58,907 10.23 51.28% 40.16% (1.22) 1.67 0.44 t ing

Type ofshares

June 28,2006 Dividends (b) (*2) Treasury stock decreased by 157thousandshares dueto thesaleofshares lessthanoneunitandby 1,814thousandshares dueto thesaleofshares by aconsolidated company. (*1) Treasury stock increased by 695thousandshares dueto therepurchase ofshares lessthanoneunit. Treasury stock: Issued stock: Typeandnumberofoutstandingshares (a) 10. Supplementary losswasallocatedNote: to No impairment leasedassets. Long-term operatingleaseobligations ofoperatingleaseobligations Current portion Operatingleases (b) Estimated interestcost bythestraight-linemethodoverleaseperiod Estimated amountofdepreciation Date ofapproval

Common stock (*1,*2) Common stock (1) Dividendspaidtoshareholders Supplementary informationforconsolidatedstatementsofchangesin netassetsatMarch31,2007consistedofthefollowing: The rentalpaymentsrequiredunderoperatingleasesthathaveinitial orremainingnon-cancelableleasetermsinexcessofoneyear at March31,2007and2006areasfollows: ended March31,2007,2006and2005,respectively. Total Annual leaseexpenseschargedtoincomewere¥30,048million($254,536 thousand),¥36,735millionand¥39,444fortheyears Estimated amountofdepreciationandfinancechargesfortheyears endedMarch31,2007,2006and2005areasfollows: Total . . . information .

. meeting ofshareholders Annual general approved by Resolution for .

consolidated . . Common statements Type of shares stock

(Millions of (Millions beginning ofyear Amount of ¥5,839 Yen) 1,949,959 1,949,959 (Thousands) ¥ Balance at changes 26,737 2007 2,099 3,211 3,211 (Thousands of (Thousands

U.S. dollars) $49,462 Amount in

net

¥ 32,824 assets ¥ Increase insharesIncrease Yen (Millions) during theyearduring 206,274 173,450 ¥31,476 (Thousands) 2007 2006 3,216 per share Amount

¥3.00 695 (Yen) 695

– – Yen (Millions)

(U.S. dollars) per share Amount $0.03 ¥153,725 ¥ 31,791 121,934 ¥33,616 Decrease inshares 2006 2005 during theyearduring 3,967 (Thousands) 1,971 1,971 Shareholders’ – – cut-off date cut-off March 31, 2006 Number ofshares $1,747,344 $ 278,052

(Thousands) (Thousands) 1,469,292 $226,488 U.S. dollars U.S. dollars 1,949,959 1,949,959 (Thousands) end ofyear Balance at June 29, 2007 2007 Effective 17,780

2006 date 1,935 1,935

57 All Nippon Airways Co., Ltd. Financial Section 58 All Nippon Airways Co., Ltd. Financial Section 12. Derivatives 11. Commitments June 25,2007 current fiscalyear Date ofapproval

At March31,2007,commitmentsoutstandingfortheacquisition (2) Dividendswithashareholders’cut-offdateduringthecurrentfiscal year,endingMarch31,2008,butaneffectivedatesubsequenttothe authorization levelsandtransactionvolumes.TheCompany to controlvariousaspectsofderivativetransactions,including not usederivativesfortradingpurposes. commodity pricesoffuel.TheCompanyanditssubsidiariesdo and optionsinitsmanagementofriskexposurerelatedtothe debt. Inaddition,theCompanyalsoentersintoavarietyofswaps impact ofinterestratefluctuationsrelatedtotheiroutstanding and itssubsidiariesutilizeinterestrateswapstominimizethe and foreign currency receivables and payables. Also, the Company related to purchase commitments, principally of flight equipment, exchange contracts to hedge certain foreign currency transactions these risks,theCompanyanditssubsidiariesutilizeforward interest ratesandcommoditypricesoffuel.Inordertomanage and areexposedtotheriskofchangesinforeignexchangerates, The Company and certain of its subsidiaries operate internationally liable asguarantorofbondswithdebtassumptioncontractsand ¥1,135,761 million($9,621,017thousand). or constructionofpropertyandequipmentamountedto but bothmaybeusedtoreduceoreliminateadeficitby nor thelegalreserveisavailableforpaymentofdividends, account. TheLawprovidesthatneitheradditionalpaid-incapital paid-in capitalaccountequals25%ofthecommonstock legal reserveuntilthetotalofandadditional disbursed asdistributionsofearningsbeappropriatedtothe that anamountequaltoatleast10%oftheamountsbe reserve whichisincludedinretainedearnings.TheLawprovides In accordancewiththeLaw,Companyprovidesalegal The Companyhasdevelopedinternalhedgingguidelines The Company and consolidated subsidiaries were contingently hrhles tc stock meeting ofshareholders and 26, June March 31, $0.03 ¥3.00 Retained $49,504 ¥5,844 Common Annual general and hedging approved by Resolution contingent

activities liabilities Type of shares

(Millions of (Millions Amount Yen)

of (Thousands U.S. dollars) Amount anns 07 2007 2007 earnings

Board ofDirectorsifcertainconditionsaremet. made atanytimebyresolutionoftheshareholdersor shareholders. UndertheLaw,however,suchdistributionscanbe return ofcapitalorasdividendssubjecttotheapproval the excessmaybedistributedtoshareholderseitherasa the legalreserveexceeds25%ofamountcommonstock, provides that, if the total amount of additional paid-in capital and stock byresolutionoftheBoardDirectors.TheLawalso resolution oftheshareholdersormaybetransferredtocommon institutions. the counterpartiesareinternationallyrecognizedfinancial counterparties willfailtomeettheirobligations,becausemostof to derivativefinancialinstruments,butitisnotexpectedthatany related lossesintheeventofnon-performancebycounterparties for hedgingactivitiesastheCompany. The consolidated subsidiaries have adopted the same procedures is examinedatinceptionand,onanongoingbasis,periodically. generally onamonthlybasis.Assessmentofhedgeeffectiveness their measuresandratios,havebeenmonitoredbymanagement the accountingdepartmentandthesetransactions,including by respectiveoperationaldepartmentshavebeenexamined internal guidelines.Derivativeandhedgingtransactionsinitiated enters intoderivativetransactionsinaccordancewiththese million ($10,860thousand)atMarch31,2007. ($255,587 thousand)atMarch31,2007. loans, principallytoaffiliates,amounting¥30,172million The Companyanditssubsidiariesarealsoexposedtocredit- TheCompanyisliablefordefectsintheamountof¥1,282 Paid from per share Amount (Yen) (U.S. dollars) per share Amount Shareholders’ cut-off date cut-off

Effective date

Capital expenditure Impairment loss Depreciation andamortization Identifiable assets Operating income Operating expenses Total Intra-group salesandtransfers Operating revenues As ofandfortheyearendedMarch31,2006 Capital expenditure Impairment loss Depreciation andamortization Identifiable assets Operating income Operating expenses Total Intra-group salesandtransfers Operating revenues As ofandfortheyearendedMarch31,2007 Capital expenditure Impairment loss Depreciation andamortization Identifiable assets Operating income Operating expenses Total Intra-group salesandtransfers Operating revenues As ofandfortheyearendedMarch31,2007 13. Segment

The Companyanditsconsolidatedsubsidiariesconduct consolidated travel and otherbusinesses.Businessesthanairtransportation, operations inairtransportation,travelservices,hotel . . . Segment informationfortheyearsendedMarch31,2007,2006and 2005isasfollows: services and hotel operations are insignificant to the information . . . results ofoperationstheCompanyandits ......

$ $ 1,6,3 $ $12,264,134 transportation transportation transportation transportation transportation transportation 27 ¥92,190 ¥(287) ¥92,477 ¥5,614 5,222 ¥ ¥ 1,920 ¥ 79,721

05846 ,6,8 5441 ,6,9 1,7,7 (,5,0) 12,618,873 (1,954,104) 14,572,977 1,667,895 564,481 1,762,185 10,578,416 ¥1,489,658 ¥1,447,781 ¥ – ¥1,489,658 ¥110,514 58,022 ¥ ¥186,872 ¥1,134,250 9,608,217 ¥1,476,599 ¥1,022,090 ¥ 74,113 ,5,2 2,0 2,5 3,0 21681 289 2,134,062 (2,829) 2,136,891 36,908 24,557 20,602 11,837,933 2,054,824 (1,951,673) 13,789,606 1,620,339 520,246 1,745,921 9,903,100 1,397,468 1,489,658 (230,395) (230,682) 1,627,863 1,720,340 191,281 196,895 61,415 66,637 206,106 208,026 1,169,061 1,248,782 425 $ $44,235 $16,264 675,316 1,058,551 1,132,664 9,8 1,1 3,0 1,1 750,614 17,611 32,402 10,512 251,926 (1,954,104) 1,954,104 (334) 690,089 731,732 252,260 72,978 4,357 179,195 2,899 970,199 2,432 (230,682) 230,682 242,572 86,381 8,615 21,154 114,532 189,501 110,574 Air Air Air Air Air Air 90,673 88,610 2,079 3,825 1,241 10,704 81,465 67,984 1,663 $

,8,9 $ 1,582,990 199,492 services services services services services services ¥ 8,7 $49368 (,3,7) $13,571,292 $(1,332,376) $14,903,668 $987,277 $1,212,867 439,390 ¥180,189 Travel Travel Travel Travel Travel Travel ¥ 3,218 180 1319 1658 17938 (5,8) ¥1,602,091 ¥(157,287) ¥1,759,378 ¥116,548 ¥143,179 51,870 ¥50,120 196,274 19,303 1,176 1,046 – – – operations operations operations operations operations operations

¥150,367 $12,618,873 $– $12,618,873 $936,163 491,503 66,376 Hotel Hotel Hotel Hotel Hotel Hotel ¥57,695 U.S. dollars(Thousands) ¥ 4,635 42,881 61,741 9,083 3,822 8,681 is notdisclosedbecauseofitsinsignificance. subsidiaries, suchasgeographicalbreakdownofsalesandassets, businesses” inthefollowingindustrysegmentinformation. consolidated subsidiariesand,accordingly,areincludedin“Other Yen (Millions) Yen (Millions) Other segmentinformationoftheCompanyandits 80 153 91,563 – 91,563 890 – 10,809 – 10,809 105 – businesses businesses businesses businesses businesses businesses

241 780,940 $(2,431) $783,371 47,556 ¥131,675 ¥108,818 ¥ 6,790 Other Other Other Other Other Other 184,123 190,913 82,095 9,705 3,349 2,224 ¥1,808,761 ¥1,368,792 ¥ 88,756 1,500,689 1,589,445 220,653 235,782 Total Total Total Total Total Total 20,451 76,201

Intercompany Intercompany Intercompany Intercompany Intercompany Intercompany eliminations eliminations eliminations eliminations eliminations eliminations ¥(141,918) ¥ 46 ¥ – (220,699) (220,653) (220,653) (202) 88,610 – 750,614 – – –

$ Consolidated Consolidated Consolidated Consolidated Consolidated Consolidated ¥1,666,843 ¥1,368,792 ¥ 88,802 1,279,990 1,368,792 235,580 20,451 76,201 – – – 59 All Nippon Airways Co., Ltd. Financial Section 60 All Nippon Airways Co., Ltd. Financial Section

Issuance ofnewstockbyexecutionacquisitionrights: Conversion ofconvertiblebonds: Cash andcashequivalents Marketable securitieswithmaturitiesofmorethanthreemonths Marketable securities Time depositswithmaturitiesofmorethanthreemonths Cash 14. Supplementary

Capital expenditure Depreciation andamortization Identifiable assets Operating income(loss) Operating expenses Total Intra-group salesandtransfers Operating revenues As ofandfortheyearendedMarch31,2005 Proceeds from sale of subsidiary’s stock withCash andcashequivalents ofsubsidiary changes in scope of consolidationSales priceofsubsidiary’s stock Gain onsaleofsubsidiary’sstock Fixed liabilities Current liabilities Goodwill Fixed assets Current assets

Credited tocapitalsurplus Credited tocommonstock Credited tocapitalsurplus Credited tocommonstock Reconciliation ofthedifferencebetweencashstatedinconsolidated balancesheetsasofMarch31,2007,2006and2005cash cash equivalentsforthepurposeofstatementsflowsisasfollows: . and theproceedsfromsaleofsubsidiary’sstockwithchanges inscope ofconsolidation. due tosaleofallinterestsbytheCompany,aswellareconciliation of thedifferencebetweensalespricesthissubsidiary’s stock . Significant non-cashtransactionsfortheyearsendedMarch31,2007,2006and2005areasfollows: The followingaremajorcomponentsofassetsandliabilitiesANA RealEstateCo.,Ltd.,whichhasbeenexcludedfromconsolidation ...... cash . . flow ......

information

. transportation transportation ¥1,326,276 ¥ 961,969 ¥ 68,041 1,066,941 104,972 998,900 195,963 Air Air 61,703 . services services ¥170,937 Travel Travel ¥ 3,124 187,170 ¥45,732 190,294 19,357 1,216 1,134 . . operations operations

¥117,122 Hotel Hotel ¥55,454 ¥ (467) 14,044 69,965 10,164 69,498 4,004 Yen (Millions) ¥ ¥ 172,274 172,958 2007 2007 2007 (711) businesses businesses ¥ ¥ 34 ¥ ¥ ¥ ¥ ¥180,856 ¥104,453 (7) – – ¥ 6,982 – – – – – – – – – – – – – Other Other 176,375 183,357

78,904

3,152 3,605 Yen (Millions) Yen (Millions) Yen (Millions) ¥242,785 ¥234,461 ¥ 12,219 ¥ 4,872 (15,418) (11,014) (26,496) 24,645 ¥8,418 ¥4,208 16,957 11,372 37,948 06 2005 2006 2005 2006 06 2005 2006 (4,738) 4,208 ¥1,669,986 ¥1,292,813 ¥ 77,680 (903)

1,432,410 1,510,090 275 217,277 210,495 Total Total – – – 70,446

¥163,155 ¥158,204 ¥31,582 ¥15,791 ¥ 9,466 ¥ 4,733 Intercompany Intercompany eliminations eliminations 15,791 5,730 4,733 ¥ 94 ¥ – (777) (217,277) (217,371) ¥(63,373) (217,277) ¥ – ¥ – (2) – – – – – – – (315) –

$1,459,331 $1,465,125 Consolidated Consolidated (Thousands) (Thousands) (Thousands) U.S. dollars U.S. dollars U.S. dollars ¥1,606,613 ¥1,292,813 ¥ 77,774 1,215,039 1,292,813 2007 2007 2007 210,180 (6,023) 70,446 288 (59) $ – $ – $ $ $ $ – – – – – – – – – – – – –

– Note: As ofandfor theyear endedMarch 31,2006 Note: As ofandfor theyear endedMarch 31,2007

16. Subsequent 15. Impairment

Idle assets Rental realestateassets Business assets Hotel businessassets Assets expectedtobesold Based ontheresolutionofBoardDirectors’meetingheld The assetsoftheCompanyanditsdomesticconsolidatedsubsidiaries aregroupedbyindividualpropertyinthecaseofhotelbusiness (3) (2) (1) Group”) companiesandcompletedthetransferonJune1,2007: to hotelsownedandleasedbytheCompany’sgroup(the“ANA transfer all the shares and assets in 14 subsidiary companies relating on April13,2007,theCompanyenteredintoanagreementto March 31,2007and2006,respectively. recoverable assets assets. Duetoslumpingperformanceinbusinessassetsandhotel assetsaswellfallingpricesofrentalrealestateand assets, rentalrealestateassetsexpectedtobesoldandidle bymanagementaccountingcategoriesinthecaseofbusiness rates of3.5% to 10.6%. rates of3.5% to 11.7%. The recoverable amountoftheassetswasmeasured usingthenetrealizable valuebasedonreal estate appraisalorsalesagreement, orusingthevalueinusemethodwithdiscount The recoverable amountoftheassetswasmeasured usingthenetrealizable valuebasedonreal estate appraisalorsalesagreement, orusingthevalueinusemethodwithdiscount Application Application June 1,2007 Date oftransfer: 14 hotelsubsidiarycompaniesand 3realestateproperties Transferred companiesandproperties: as announcedonJanuary31,2006. in linewithits2006-2009Midterm CorporateStrategy, To disposeoftheANAGroup’sownedandleasedhotelassets Reason fortransfer: expected to be sold, the net book values of assets whose profitability and market prices dropped notably were written down to the

amount andimpairmentlossesof¥10,809million($91,563thousand) ¥20,451millionwererecordedintheyearsended loss event

2 inKanto/5others 1 inKanto/5others 1 in 1 inKanto/2others

Hokkaido Location Location

Total Total Intangible fixedassetsandothers Total Land andothers Buildings andothers Land, Others Buildings andothers Total Total Buildings Aircraft Land



(5) (4) b

uildings andothers ¥130.0 billion($1,101million) Profits fromthedeal(Estimated): *  Registered Address:Koto-ku,Tokyo,Japan CEO: Mr.TomoakiYamada Company name:Y.K.ShiroyamaProperties* Transferee: of equityorpersonnelwiththeANAGroup. fund managedbyMorganStanley,andhasnolinkinterms Shiroyama PropertiesisaYugenKaisha(Y.K.)formedby Category Category Impairment loss Yen (Millions) Yen (Millions) ¥ ¥ ¥ ¥ ¥10,616 ¥ 7,462 ¥ 9,038 ¥ 8,232 ¥ ¥ 44 105 10,704 10,704

3,154 797 778

806 61 19 Impairment loss

(Thousands) U.S. dollars $ $ $ $ 890 373 90,673 90,673 517

61 All Nippon Airways Co., Ltd. Financial Section 62 All Nippon Airways Co., Ltd. Financial Section Report of Independent Auditors ofIndependent Report

Okinawa ANA Resort Co., Ltd. Resort ANA Okinawa ANA Business Create Co., Ltd. Business ANA Notes:  Notes: Trading Co., Ltd. Airways Nippon All Businesses Other Co., Tokyo Ltd. Hotel ANA Operations Hotel Co., Ltd. Sales ANA Travel Services Co., Ltd. Maintenance Aircraft ANA Co., Ltd. Service Catering ANA Co., Ltd. Utility Airport International Related Support Transportation Transportation: Air Co., Ltd. (CRF) Central Air Co., Ltd. (AJX) Japan Air Co., Ltd. (ANK) Nippon Air Co., Ltd. (ANA) Airways Nippon All Related Transportation Transportation: Air (As of March 31, 2007) andAffiliates ANA andPrincipal Subsidiaries

ANA Logistic Service Co., Ltd. Service Logistic ANA Co., Ltd. Planning Systems Information ANA Co., Ltd. (AJV) Express &JP ANA Co., Ltd. (NXA) Next Air Co., Ltd. (AKX) Network Nippon Air New Tokyo Airport Service Co., Ltd. Service Airport Tokyo New Sky Building Service Co., Ltd. Service Building Sky

The ANAGroup Total Other Businesses Other Hotel Operations Travel Services Operating segment Air Transportation

1. Figures for revenues and paid-in capital of each company are stated before intercompany eliminations. intercompany before stated are company each of capital paid-in and revenues for 1. Figures 2. ANA transferred its hotel business outside the Group in June 2007. June in Group the outside business hotel its transferred ANA 2. 2 Total 128 65 16 38

9 operations Hotel services introduction dispatch and inspection/HR ticket Air Trading and retail (development of airport stores and other stores stores other and stores airport of (development Trading retail and operations Hotel and domestic of sales and support, (development, Travel services equipment and aircraft of Maintenance, repair, improvement and meals in-flight of Preparation operations taxi/towing aircraft Airport Haneda using routes arrival/departure (mainly Nagoya transportation Air routes) resort (mainly Asian transportation Air aircraft) turbo-prop using routes using routes mid/long-distance (mainly domestic transportation Air transportation Air Principal Businesses

Air cargo imports warehousing and import/export administration administration import/export and warehousing imports cargo Air services cleaning and services integration system and consulting System methods) other and magazine in-flight ANA through sales direct and packages) travel international transportation cargo Air aircraft) narrow-body using routes arrival/departure Nagoya and (mainly Fukuoka transportation Air aircraft) turbo-prop arrival/departure Itami and Hokkaido (mainly within transportation Air aircraft) narrow-body operations taxi/towing aircraft Airport Narita Contracting of building/facility maintenance, management, maintenance, management, building/facility of Contracting Number ofsubsidiaries consolidated of which, 95 32 16 38 9 equity method equity of which, – – – 5 5

Total 44 35

3 1 5 ¥1,289,429 Revenues (Millions) 198,299 144,140 Number ofaffiliates 20,375 11,644 11,644 16,942 13,857 91,297 12,745 13,315 8,840 6,284 9,948 4,461 5,592 8,910 7,555 7,519 adi Percentage Paid-in 1

Capital ¥160,001 (Millions) 2,600 5,400 1,000 2,433 equity method equity 300 200 360 465 100 352 40 80 80 60 50 50 50 53 of which, 1 theParent by Owned 20 12 2 1 5 Parent

100.0 100.0 100.0 100.0 100.0 100.0 100.0 44.8 60.0 86.7 98.7 50.0 50.0 39.5 51.7 57.0 97.5 0.0

63 All Nippon Airways Co., Ltd. The ANA Group ANA Route System (As of June 8, 2007)

Domestic Network Wakkanai Number of routes: 130 Rishiri Okhotskmonbetsu

Number of flights: 938 per day Asahikawa Memanbetsu Nakashibetsu Sapporo (Okadama) Kushiro Sapporo (Chitose) Number of routes: 5 Hakodate

Number of flights: 8 per day Odate-Noshiro ● Cities served by ANA Group, including Akita Shonai code-sharing with (IBX), International Network

Air Do (ADO), Skynet Asia (SNA), and Sendai Niigata Starflyer (SFJ). Noto Fukushima Cargo-only route Toyama Number of routes: 38 Kanazawa Tottori (Komatsu) Number of flights: 596 per week Yonago Tokyo Narita Osaka (Haneda) Iwami (Itami) (ANA Group total, excluding code-share flights) Tsushima Okayama Kobe Nagoya Hiroshima Osaka (Chubu) Yamaguchi/Ube Takamatsu (Kansai) Oshima Fukuoka Matsuyama Kitakyushu Tokushima Saga Nagasaki Oita Kochi Hachijojima Gotofukue Kumamoto Number of routes: 20 Miyazaki Kagoshima Number of flights: 108 per week ● Cities served by ANA Group ● Cities served by code-sharing Cargo-only routes

Toronto Columbus Ottawa Okinawa Richmond (Naha) Pittsburgh Cincinnati Montreal Miyako Minneapolis Cleveland 国際線 (旅客便+貨物便) Ishigaki Bu alo Baltimore Philadelphia コードシェア便(※)を含む Anchorage ANA Route System ANA Route Boston 276路線4,657便/週 Vancouver Chicago New York (J.F. Kennedy, Newark) Seattle St. Louis ANAグループ運航便:52路線704便/週 64 Portland Denver Nashville Washington, D.C. (Dulles) Salt Lake City Charlotte 提携他社運航コードシェア便:241路線3,953便/週 Atlanta Orlando San Francisco Las Vegas (ANAまたはANKマーケティング便) Warsaw Phoenix Aberdeen Hamburg Los Angeles Houston Tampa Miami Santa Ana *臨時便・チャーター便は除く Edinburgh Berlin San Diego Leeds London Linz * は貨物便のみの運航路線 Glasgow Frankfurt Salzburg Vienna Belfast Manchester Dusseldorf Graz Mexico City ●ANAグループが就航している都市 Dublin Munich Innsbruck Zurich Honolulu ●コードシェア便が就航している都市 Paris Geneva Milan Asahikawa Detroit Birmingham (※)コードシェア(路線提携)とは Indianapolis Sapporo Raleigh-Durham 提携会社の運航する便に自社の便名(コード)を付与するこ Winnipeg New Orleans All Nippon AirwaysLtd. Co., Knoxville Dayton とで、より広範で利便性の高い路線ネットワークを提供する Westchester Dallas Shenyang Sendai Toyama Syracuse Allentown Dalian Fukushima Yonago Albany Beijing Seoul (Incheon) Louisville Austin Busan Kansai Narita Tianjin Hiroshima Centrair San Antonio Hartford Takamatsu Burlington Xian Qingdao Jeju Fukuoka Rochester Chicago Kumamoto Matsuyama Roanoke Columbia Shanghai Charleston Guangzhou Hangzhou Miyazaki Portland Des Moines Chongqing Xiamen Providence Taipei Grand Rapids Shenzhen Okinawa Norfolk Chiang Rai Hong Kong Guam Omaha Greensboro Hanoi Greenville Chiang Mai Madison Jacksonville Milwaukee Bangkok Ho Chi Minh City Lexington Kansas City Hat Yai Manchester Memphis Harrisburg Phuket Kota Kinabalu Doha Kuala Lumpur Cairo Singapore Luxor Baltimore Norfolk Burlington Portland Cleveland Albuquerque Albany Providence Austin Syracuse New York Bakerseld (Newark, J.F. Kennedy, La Guardia) Rochester Philadelphia San Boise Detroit Washington, Richmond Tucson Francisco D.C. Fresno Cleveland Greensboro Sacramento Harrisburg Raleigh-Durham Santa Barbara Monterey Pittsburgh Columbia Palm Springs Greenville Charleston San Antonio Roanoke Jacksonville Reno

Johannesburg (As of March 31, 2007) Association Ownership Co., Airways Ltd.All Nippon Employee Stock Nagoya Co., Railroad Ltd. ShareholdersMajor Tokyo, andLondon Osaka, Stock Listings 274,736 Number ofShareholders Issued: 1,949,959,257shares Authorized: 3,900,000,000shares Number ofShares ofCommon Stock ¥160,001 million Paid-in Capital 32,460 (Consolidated) Number ofEmployees City, Yangon, Lumpur, Kuala Singapore, Bombay HoChiMinh Hangzhou, Guangzhou, Hong Kong, Seoul, Bangkok, Beijing, Tianjin, Shenyang, Dalian,Qingdao, Shanghai,Xiamen, Asia Brussels, Moscow, Rome, Madrid London, Paris, Frankfurt, Hamburg, Dusseldorf, Geneva, Zurich, Europe Honolulu; Guam Los Angeles;New York; Washington, D.C.; Chicago;SanFrancisco; United States other cities Sapporo, Tokyo, and39officesin Fukuoka, Okinawa, Nagoya, Osaka, Japan Offices FAX: 81-3-6735-1185 TEL: 81-3-6735-1030 Investor Relations URL: http://www.ana.co.jp/ FAX: 81-3-6735-1005 TEL: 81-3-6735-1000 Minato-ku, Tokyo 105-7133,Japan 1-5-2 Higashi-Shimbashi, Center,Shiodome City Head Office 27,1952 December Date ofFoundation Investor Information Corporation Banking Sumitomo Mitsui Life CompanyNippon Insurance Japan Ltd.Trustee Bank, (trustaccount) Service The Master Trust Ltd. BankofJapan, (trustaccount) The Asahi ShimbunCompany Ltd. Corporate Bank, Mizuho Co., Sumitomo Insurance Ltd.Mitsui Tokio Fire &Nichido Co., Marine Insurance Ltd.

Total (Thousands) shares held Number of 378,090 24,518 26,753 26,820 29,755 30,681 34,770 42,073 43,397 47,341 71,982

Percentage of total shares 19.39% inissue 1.26 1.37 1.38 1.53 1.57 1.78 2.16 2.23 2.43 3.69 % (¥) per Share (¥) Stock Price* (¥): Stock Price (Consolidated) andRatios Stock Price * Tokyo Stock Exchange Cash Dividends PBR (times): (times): Ratio Price /Cash Flow PER (times): Depositary: CUSIP: 016630303 Symbol: ALNPY Exchange: OTC (Over-the-Counter) (ADR:ORD): 1:2 Ratio Receipts Depositary American & YoungErnst ShinNihon AuditorsIndependent Fuchu, 1-10, Nikko-cho, Tokyo 183-8701,Japan The Sumitomo Trust Co., andBanking Ltd. Transfer Agent per Share (¥) (Loss)Net Income

Equity perShareEquity (¥) 150 300 450 600 Stock Price R High High High High Low Low Low Low 0 URL: http://www.adrbny.com U.S. Toll Free: 1-888-269-2377(888-BNY-ADRS) TEL: 1-212-815-2042 101 Barclay Street, 22 West, New York, NY10286,U.S.A. The Bank ofNew York 5 4 7 6 2004 9 8 ange

10

11 12 2 1 3 204.42 5 4 16.77 2007 3.00 23.4 29.2 392 489 2005 7 6 1.9 2.4 6.3 7.9

9 8 10 11 177.89 15.64 06 05 04 2003 2004 2005 2006 12 3.00 20.5 32.5 321 509 1.8 2.9 5.6 8.9 2 1

3 5 4 2006 128.31 7 6 17.26 3.00 18.1 23.3 312 403 2.4 3.1 5.3 6.8 9 8 1 1 0 1 1 2 16.14 97.66 1 3.00 11.8 22.6 191 364 2.0 3.7 3.3 6.3 4 2 2007 3 6 5 (18.42) 79.57 17.4 202 380 2.5 4.8 9.2 – – – 65 All Nippon Airways Co., Ltd. Investor Information All Nippon Airways Co., Ltd. ALL NIPPON AIR WA YS

CO ., LT D.

ANNU AL REPORT 2007

Staying on Course— Annual Report 2007 Working to Be Asia’s Number One Airline For the Year Ended March 31, 2007

Printed on recycled paper Printed in Japan

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Profi le Investor Information (As of March 31, 2007)

In the more than 50 years since its founding in 1952, All Nippon Airways Co., Ltd. (ANA), Date of Foundation Transfer Agent December 27, 1952 The Sumitomo Trust and Banking Co., Ltd. has provided air transportation services, with the highest priority on safe operations. Head O ce 1-10, Nikko-cho, Fuchu, Tokyo 183-8701, Japan ANA is proud of the high level of trust that customers have placed in the Company. As a Shiodome City Center, Independent Auditors 1-5-2 Higashi-Shimbashi, Ernst & Young ShinNihon result of that trust, ANA has grown into a world-class airline, with more than 51 million Minato-ku, Tokyo 105-7133, Japan American Depositary Receipts passengers a year. TEL: 81-3-6735-1000 Ratio (ADR:ORD): 1:2 FAX: 81-3-6735-1005 Exchange: OTC (Over-the-Counter) With an overriding emphasis on safety and URL: http://www.ana.co.jp/ Symbol: ALNPY customer satisfaction, the ANA Group will continue Investor Relations CUSIP: 016630303 TEL: 81-3-6735-1030 Depositary: working to be the number one airline group in Asia. FAX: 81-3-6735-1185 The Bank of New York O ces 101 Barclay Street, 22 West, New York, NY 10286, U.S.A. Japan TEL: 1-212-815-2042 Sapporo, Tokyo, Nagoya, Osaka, Fukuoka, Okinawa, and 39 o ces in U.S. Toll Free: 1-888-269-2377 (888-BNY-ADRS) other cities URL: http://www.adrbny.com United States Stock Price and Ratios (Consolidated) Los Angeles; New York; Washington, D.C.; Chicago; San Francisco; Honolulu; Guam 2007 2006 2005 2004 2003 Stock Price* (¥): Europe High 489 509 403 364 380 London, Paris, Frankfurt, Dusseldorf, Hamburg, Zurich, Geneva, Low 392 321 312 191 202 Brussels, Moscow, Rome, Madrid PER (times): Asia High 29.2 32.5 23.3 22.6 – Beijing, Tianjin, Shenyang, Dalian, Qingdao, Shanghai, Xiamen, Low 23.4 20.5 18.1 11.8 – Hangzhou, Guangzhou, Hong Kong, Seoul, Bangkok, Ho Chi Minh Price / Cash Flow City, Yangon, Kuala Lumpur, Singapore, Bombay Ratio (times):

High 7.9 8.9 6.8 6.3 17.4 rmation fo

Number of Employees Low 6.3 5.6 5.3 3.3 9.2 In 32,460 (Consolidated) PBR (times): vestor Paid-in Capital High 2.4 2.9 3.1 3.7 4.8 In Low 1.9 1.8 2.4 2.0 2.5 ¥160,001 million Contents Net Income (Loss) 65 Number of Shares of Common Stock per Share (¥) 16.77 15.64 17.26 16.14 (18.42)

Authorized: 3,900,000,000 shares Equity per Share (¥) 204.42 177.89 128.31 97.66 79.57 d. Issued: 1,949,959,257 shares Cash Dividends Lt ., 1 ANA Group Corporate Philosophy Forward-Looking Statements Number of Shareholders per Share (¥) 3.00 3.00 3.00 3.00 – ways Co ways 2 Consolidated Financial Highlights This annual report contains statements to signi cant  uctuations. It is possible 274,736 * Tokyo Stock Exchange based on ANA’s current plans, estimates, that these conditions will change dramati-

4 ANA at a Glance strategies, and beliefs; all statements cally due to a number of factors, such as Stock Listings Stock Price ippon Air

that are not statements of historical fact demand trends, sales prices, crude oil price Tokyo, Osaka, and London All N 6 To Our Shareholders Stock Price Range are forward-looking statements. These  uctuations, the international situation, the Major Shareholders 10 Corporate Governance statements represent the judgments and economic environment, foreign exchange Number of Percentage of hypotheses of the Company’s management rate  uctuations, and others. Due to these (¥) 12 Management Members and Group Organization shares held total shares 600 based on currently available information. risks and uncertainties, it is possible that the (Thousands) in issue Air transportation, the Company’s core Company’s future performance will di er 14 Special Feature Nagoya Railroad Co., Ltd. 71,982 3.69% business, involves government-mandated signi cantly from the contents of this annual 450 Fleet Strategy: costs that are beyond the Company’s report. Accordingly, there is no assurance The Master Trust Bank of Japan, Ltd. (trust account) 47,341 2.43 A Key Part of Our Mission to Become control, such as airport utilization fees and that the forward-looking statements in this Tokio Marine & Nichido Fire Insurance Co., Ltd. 43,397 2.23 fuel taxes. In addition, conditions in the annual report will prove to be accurate. Japan Trustee Service Bank, Ltd. (trust account) 42,073 2.16 300 Asia’s Number One Airline markets served by the Company are subject 19 Review of Operations Mitsui Sumitomo Insurance Co., Ltd. 34,770 1.78 Nippon Life Insurance Company 30,681 1.57 150 29 CSR (Corporate Social Responsibility) All Nippon Airways Co., Ltd. Employee Stock 31 Financial Section Ownership Association 29,755 1.53 0 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1 23 4 5 6 63 The ANA Group Sumitomo Mitsui Banking Corporation 26,820 1.38 2004 2005 2006 2007 64 ANA Route System Mizuho Corporate Bank, Ltd. 26,753 1.37 65 Investor Information The Asahi Shimbun Company 24,518 1.26 Total 378,090 19.39% ANA Fact Book 2007 (separate) Please refer to the various data contained therein.

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