|
US Airways Books First Quarter Profit
By JOSHUA FREED, AP Airlines Writer
(article can also be read
HERE)
US Airways reported better-than-expected results for the first quarter
on Wednesday as it raised fares to offset the rising price of fuel.
The nation's fifth-largest airline earned $48 million, or 28 cents per
share, for the quarter because of one-time gains. Not counting special
items it lost money, although less than analysts expected.
Like other airlines, US Airways has been raising fares to offset higher
fuel prices. Per-seat passenger revenue rose 8.2 percent. Even with
higher fares, passenger traffic rose 4.7 percent.
"As we prepare for the busy summer travel period, we continue to be
encouraged with the overall strength in passenger demand," Chairman and
CEO Doug Parker said in a prepared statement.
The first three months of the year are seasonally weak for travel. US
Airways would have lost $22 million, or 13 cents per share, if not for a
one-time $73 million gain related to its trade with Delta for landing
rights in Washington and New York. Analysts surveyed by FactSet had been
expecting a loss of 25 cents per share.
A year ago, the airline lost $114 million, or 71 cents per share.
Revenue rose 10.3 percent to $3.27 billion, more than analysts had
expected.
Fuel expenses jumped 17 percent to $859 million.
US Airways, based in Tempe, Ariz., said last week that it has the
support of unions at American Airlines for a merger of the two airlines.
American is reorganizing under bankruptcy protection.
In its quarterly filing with the Securities and Exchange Commission, US
Airways said it is continuing to study American's parent AMR Corp., and
has concluded that merging with AMR while it's in bankruptcy "represents
a unique opportunity for our company."
US Airways Group Inc. shares rose 36 cents, or 3.9 percent, to $9.67 in
premarket trading.
Copyright © 2012 The Associated Press. All rights reserved.
-----
American Tells Judge it Needs More Union Concessions
by JASON WHITELY
(article can also be read
HERE)
NEW YORK - American Airlines parent company AMR Corp. told a federal
bankruptcy judge in New York Tuesday it is squeezing out savings as it
restructures.
A top executive of the carrier told the court that cutting labor costs
is the only option it has left on the table.
The future of a storied airline and 13,000 union workers is being laid
out in the courtroom more than 1,500 miles from its Fort worth
headquarters, in sight of the Statue of Liberty.
Taking the stand on Tuesday was Beverly Goulet, American's Chief
Restructuring Officer. She said the company and its consultants have
squeezed out all the savings they can from the airline - $4 billion
worth.
She said pilots, flight attendants and ground workers must now take a 20
percent pay cut, worth another billion dollars.
Laura Glading, representing the Association of Professional Flight
Attendants, said she understands the airline's strategy in the wake of
similar restructurings at other airlines. "I think American looked at
the other bankruptcies and said, 'We're going to get what we want.
Everyone else has. And so we won't be denied.'"
She's right; no other airline has been.
Still, American's unions continue to suggest to the court that a merger
is the carrier's only option to save jobs - and the airline itself.
In court, Goulet admitted to union attorneys: "I think there are
advantages to larger [airline] networks," but she wouldn't concede that
American must merge to grow.
"American Airlines has a business plan going forward," said American
spokesman Bruce Hicks. "It isn't like we're trying to follow five
different plans; we know what we want. We're heading in that direction.
It's the plan that will return American Airlines to sustainable
profitability and success."
Tuesday's testimony sometimes got mired in the mundane. The judge
half-joked to attorneys: "We'd like to finish this hearing sometime this
calendar year. We seem to be hop-scotching around."
One of the flight attendants' lawyers pointed out the problem - that the
court is dealing with three different groups, all of them facing an
uncertain future - a future that's likely to be decided in this New York
courtroom.
E-mail
jwhitely@wfaa.com
|
