(Photo= Yonhap news)

 

[Alpha Biz= Reporter Kim Jisun] As of the end of the first half of this year, the unused mileage of Korean Air and Asiana Airlines has accumulated to approximately 3.5 trillion won. However, the use of mileage for purchasing airline tickets has increased compared to before the COVID-19 pandemic.

According to the Financial Supervisory Service's electronic disclosure system (DART) on the 18th, as of the end of June, Korean Air's deferred revenue from mileage stood at 2.5278 trillion won, while Asiana's was 975.8 billion won. Combined, the deferred revenue amounts to 3.5486 trillion won.

Deferred revenue refers to the amount of mileage not yet recognized as revenue at the time of the initial sales transaction but is recognized when the mileage is eventually used. It is considered a liability on the financial statements. The deferred revenue amount reflects the total mileage accumulated.

Compared to the end of the first half of last year, deferred revenue has increased by 4.5% for Korean Air and 3.5% for Asiana Airlines. Compared to the end of the first half of 2019, Korean Air's deferred revenue has increased by 15.2%, while Asiana's has grown by 38.3%.

During the COVID-19 period, restrictions on aircraft operations led to measures such as extending the validity period of expiring mileage by up to three years. Both companies have a 10-year validity period for mileage accumulated since July 2008.

Although the number of passengers for both airlines has not yet recovered to pre-COVID levels, the increase in mileage seat availability has led to a rise in the number of passengers using mileage for ticket purchases. In the first half of this year, passenger recovery rates (for international routes) were 85% for Korean Air and 81% for Asiana Airlines.

For the first half of this year, Korean Air's Bonus Passenger Kilometer (BPK) increased by 8.8% compared to the same period last year and by 32.1% compared to the first half of 2019. Asiana Airlines recorded a 26.4% increase compared to the previous year and a 28.4% increase compared to the first half of 2019.

BPK represents the total mileage used for ticket purchases, calculated by multiplying the number of bonus passengers by the distance of the flight segment. Bonus passengers include those who used mileage 100% to purchase tickets as well as those who used some mileage for seat upgrades.

Moving forward, both airlines plan to continue promoting the use of unused mileage and expanding mileage redemption options beyond airline tickets to enhance customer convenience.

 

 

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