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U.S. Airways Posts 2Q Loss on Fuel Costs

Posted on: Friday, 29 July 2005, 09:00 CDT

ARLINGTON, Va. - U.S. Airways Group Inc., which is operating under bankruptcy protection and has agreed to be acquired by low-cost carrier America West Airlines, posted a $62 million loss for the second quarter as fuel costs surged nearly 70 percent.

U.S. Airways's loss amounted to $1.13 per share, in the three months ended June 30 compared with earnings of $34 million, or 59 cents, a year ago. Before special items, the adjusted loss for the latest quarter was $36 million.

Revenue totaled $1.95 billion, down slightly from $1.96 billion a year earlier. Passenger revenue edged up to $1.77 billion from $1.76 billion, the company added.

U.S. Airways' traffic increased 4.3 percent to 12.53 billion revenue passenger miles - one customer flown a mile - on a 6.2 percent rise in overall capacity, but occupancy, or load factor, slipped to 76 percent from 77.4 percent.

The company's mainline operations saw revenue per available seat mile fall 4.8 percent to about 11 cents, while per-mile costs fell 5.3 percent to 10.6 cents.

However, the average cost of fuel swelled 57 percent to $1.68 per gallon, resulting in a 69 percent rise in quarterly fuel costs to $445 million.

In May, America West, the operating unit of parent America West Holdings Inc., offered to buy U.S. Airways out of bankruptcy to form a nationwide discount airline that would better compete with rival companies.

The deal has cleared most regulatory hurdles, but must receive final approval from a bankruptcy court in Alexandria, Va.

Source: Associated Press/AP Online

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