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US Airways 2Q Profit Falls 14 Percent

Posted on: Thursday, 26 July 2007, 12:20 CDT

TEMPE, Ariz. - US Airways Group Inc. said Thursday its second-quarter profit fell 14 percent on higher maintenance and other expenses, but results topped Wall Street's expectations and the carrier began recalling furloughed flight attendants and pilots.

Quarterly earnings dropped to $263 million, or $2.77 per share, from $305 million, or $3.25 per share, in the prior-year period. Excluding special items, the airline earned $2.74 per share in the recent quarter.

Wall Street, on average, expected quarterly earnings of $2.64 per share, according to a Thomson Financial analyst survey.

Shares fell $2.12, more than 6 percent, to $32.72 at the open of trading Thursday.

Revenue slipped to $3.16 billion from $3.17 billion on weaker revenue from its cargo and express units, but matched analysts' expectations.

"Although high fuel prices will continue to have a material financial impact on our company, we are encouraged by the strengthening revenue environment and industry capacity outlook," Chairman and Chief Executive Doug Parker said in a statement. "Looking forward, we maintain our projections of profitability for the third quarter and full-year 2007."

Unit passenger revenue - a key industry gauge of revenue divided by capacity - across US Airways' mainline and express fleets grew by 0.2 percent, while mainline unit costs rose by 2.6 percent.

Among US Airways' increased costs, aircraft maintenance expenses rose to $170 million from $153 million due to the return of leased aircraft and other items.

Source: Associated Press/AP Online

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