Awa Reports Strong Quarter Earnings

[airlinedivalish]

Fuel tops America West expenses
With US Air deal in background quarterly earnings rise


SAN FRANCISCO (MarketWatch) -- Despite spending more on fuel than on labor, America West Holdings on Thursday reported stronger-than-expected second-quarter earnings on a 20% increase in operating revenue.




The Phoenix-area company (AWA: news, chart, profile) , in the midst of merging with bankrupt US Airways Group (UAIRQ: news, chart, profile) , reported quarterly earnings of $13.9 million, or 29 cents a share, up from $10.7 million, or 20 cents a share, last year.

Analysts polled by Thomson First Call, on average, expected America West to report a 13-cent profit. Individual estimates ranged from of a loss of 15 cents to earnings of 35 cents a share.

Top executive Doug Parker said that the US Airways deal is "on track" and that the transaction should close this fall.

Excluding a $2.7 million loss related to fuel hedging and a $4.3 million loss related to the sale and leaseback of planes, America West said it would have earned $20.9 million, or 41 cents a share, vs. $3.5 million, or 7 cents a share, last year.

Revenue came to $833.2 million, up from $694.2 million.

Fuel costs rose 44% to $191 million while labor costs rose 7.3% to $173.8 million. The carrier paid a $1.67 a gallon on average during the second quarter - a 43% higher price than last year.

Cost per available seat mile rose 12% but excluding fuel it would have fallen 2.7%.

Chief Financial Officer Derek Kerr noted that fuel costs look to continue to be larger than salaries and benefits expenses.

The company ended the quarter with $413.9 million in cash and investments.

Shares of America West rose 1.6% to $8.32.

 

[jimntx]

Congratulations, AWA!

 

[airlinedivalish]

Thank you ! Here's some more good news for US.


US Airways Says It Can Profit By '07

US Airways predicts it will make a profit by 2007, if creditors allow it to merge with America West.

The airline painted a relatively rosy picture of its future, even if oil prices remain near $60 per barrel, in filings submitted to U.S. Bankruptcy Court late Monday. The financial forecasts are part of the company's effort to convince its creditors to vote for the proposed merger.

A merger provides US Airways, Charlotte's dominant carrier and employer of 5,300 locally, its best chance to survive, management says. The combined carrier would have a network that stretches from Europe to the Caribbean to Hawaii and could compete with low-cost carriers on fares, the airlines say.

If the creditors vote against the merger and US Airways had to liquidate, the airline said in this week's filings that unsecured creditors would get nothing for the $3.1 million the airline owes them.

All the cash generated in a hypothetical Chapter 7 liquidation by selling US Airways' planes, de-icing fluid, uniforms and airport gates would produce just enough to pay back secured creditors at the front of the payment line, it said.

Secured creditors are generally the airline's biggest, such as banks and other key financiers. The unsecured creditors are often smaller vendors but also include big companies such as plane-maker Bombardier Aerospace.

If creditors allow US Airways to merge with America West, the airlines say they would trim their net loss to $65 million in 2006 and turn a $316 million profit in 2007.

 

[coolflyingfool]

The fact that anyone makes a profit is good. The fact that their profit margin went up by $3 MM is even better.

 

[1ab]

Does HP offer stock option to its employees or any profit sharing schemes

 

[barbeetantrums]

Does HP offer stock option to its employees or any profit sharing schemes

[post="283218"][/post]​

Nope. Lost that in BK back in the day.