Korean Air reported a net loss of ₩566.4bn for the six months to 30 June 2026, against a profit of ₩907.1bn a year earlier, in its semiannual securities report filed with Japan's Kanto Local Finance Bureau on 30 September. Sales rose 9.3% to ₩13.89tn, but operating profit fell 61.3% to ₩310.3bn.
Fuel and currency ate the growth
The filing attributes the operating-profit drop mainly to higher jet fuel prices and exchange-rate swings, plus higher airport charges and depreciation. Fuel expense rose to ₩4.74tn from ₩3.43tn in the same half of 2025. Below the operating line, the pre-tax result turned from a ₩1.23tn profit to a ₩686.3bn loss, which the company ties to weaker operating profitability and large foreign-currency translation losses after the won weakened.
The loss was not evenly spread. Of the ₩566.4bn net loss, ₩266.1bn belongs to Korean Air's shareholders and ₩300.4bn to minority holders. Asiana Airlines alone posted a consolidated half-year net loss of ₩658.8bn and an operating loss of ₩408.6bn before intragroup eliminations. Korean Air holds 63.88% of Asiana.
A thinner balance sheet
Total borrowings, which include lease liabilities, reached ₩24.65tn at the end of June, up ₩2.16tn from December. Leases account for ₩13.67tn of that. The filing says total liabilities rose mainly on aircraft-related borrowings and lease liabilities and on higher advance receipts for ticket sales, and that equity fell because of the net loss and the cash dividend paid for the prior year.
| Measure | 30 Jun 2026 | 31 Dec 2025 |
|---|---|---|
| Total borrowings | ₩24,646.6bn | ₩22,488.1bn |
| Debt ratio | 390.69% | 339.90% |
| Current ratio | 58.69% | 64.38% |
| Equity ratio | 20.38% | 22.73% |
Current liabilities of ₩17.23tn now exceed current assets of ₩10.11tn. Korean Air's bond terms include a covenant on its won-denominated bonds that caps the debt ratio at 1,500%. The report does not state how much headroom that leaves. The half-year figures are unaudited: the financial statements were reviewed, not audited, and the management analysis is based on internal accounting records.
The Asiana terms
Korean Air's and Asiana's boards approved a merger agreement on 13 May 2026, and the two signed it the next day. Korean Air will be the surviving company and will take over all of Asiana's assets, liabilities and rights and obligations, plus its employees. Asiana shareholders will receive 0.2736432 Korean Air common shares for each Asiana common share, a ratio set on market prices under Korea's capital markets law. Korean Air expects its share capital to rise by about ₩101.7bn.
Korea's transport ministry gave conditional approval on 25 June. The filing's post-period notes say Korean Air's board approved the small-scale merger on 12 August in place of a shareholder meeting, the route it says is open because the deal meets the simplified-merger test. The effective date is planned for 16 December 2026. Overseas aviation authorities are to be approached after domestic approvals are complete. The filing itself warns that the merger and integration process is complex and requires substantial expense and time, and could see unexpected delays or fail to go as planned, citing mileage programmes, IT systems, brand transition and staff retention.
For fairness, Korean Air's ESG committee acted as a special committee on the terms, and an independent outside expert checked the ratio and valuation method.