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Midwest Cuts First-Quarter Loss: Airline Adds Passengers but Has More Fuel Costs

Posted on: Tuesday, 25 April 2006, 03:02 CDT

By Tom Daykin, Milwaukee Journal Sentinel

Apr. 25--Midwest Airlines flew more passengers in the first three months of the year, helping the Oak Creek-based air carrier cut its first-quarter loss nearly in half.

Midwest Air Group Inc., which operates Midwest Airlines and regional carrier Skyway Airlines, said Monday that its loss narrowed to $8.68 million, or 49 cents a share, from $15.94 million, or 91 cents, in first-quarter 2005.

Analysts surveyed Thomson Financial had projected a loss of 40 cents.

After results were announced, the airline's stock closed at $5.50 a share, up 17 cents, or 3.2%.

Midwest Air boosted revenue 34.6% to $150.7 million from $112 million.

The company reported market share gains at Milwaukee's Mitchell International Airport, where Midwest Airlines is the largest carrier, and in Kansas City, Mo., the company's second-largest market.

But the company's fuel costs increased 50%, to $52.8 million from $35.2 million.

Some of that higher cost was tied to greater fuel usage, with the company adding flights to accommodate more passengers.

But $11 million of the cost increase was due to higher prices for jet fuel.

That was the biggest factor in boosting Midwest Air's expenses to $160 million from $127.9 million, a 25.1% increase.

"We're encouraged the continuing improvement in the industry environment, as well as strong advance bookings for travel on Midwest," Timothy Hoeksema, chairman and chief executive officer, said in a statement. "We expect our earnings to reflect these positive changes as we move into the busy summer travel season, though, of course, fuel prices continue to be a concern."

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AMEX:MEH,

Source: The Milwaukee Journal Sentinel

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