TOKYO: Japanese airline ANA Holdings logged a fourth-quarter operating loss, hit hard by the country’s COVID curbs but forecast a return to a profit this financial year as domestic demand recovers and international restrictions ease.

The 57.3 billion yen ($440 million) operating loss for the three months ended March 31, calculated by Reuters, narrowed from 102.4 billion yen a year earlier.

The operating loss, flagged by the airline last week, was its eighth in nine quarters.

ANA’s prediction of 50 billion yen in annual operating profit this financial year was higher than an average 42.3 billion yen forecast from 12 analysts surveyed by Refinitiv.

“The sustained focus on reducing our operating expensesalong with increased domestic travel, strong cargo sales and favorable conditions for growth of international traffic point to a better FY2022,” ANA Chief Financial Officer Kimihiro Nakahori said in a statement.

Revenue surged 40% to 1.02 trillion yen in the last financial year, driven in part by a record cargo performance.

There are encouraging signs of a post-pandemic passenger recovery in Japan, which in late March lifted all domestic pandemic restrictions.

ANA has said as of last week, the number of passengers who booked flights for next week’s string of public holidays known as “Golden Week” increased by about 47% compared to a year ago.

Still, ANA and rival Japan Airlines Co Ltd (JAL) face uncertainties from Japan’s prolonged international border restrictions and rising fuel costs worsened by the war in Ukraine.

Prime Minister Fumio Kishida has repeatedly decided against opening the nation’s borders to overseas tourists, lifting pandemic-related bans only for students and business travellers.

The tourist ban may not be lifted until after Japan’s election in July, according to analysts.