US Airways says April unit revenue down 4 percent

TEMPE, Ariz., Fri May 3, 2013 — US Airways Group on Friday said an important revenue measure fell in April, as it grappled with disruptions caused by furloughs of U.S. air traffic control staffers.

Unit revenue, or passenger revenue per available seat mile, fell about 4 percent last month from a year earlier for US Airways and its regional airlines, the carrier said.

US Airways, which plans to merge with AMR Corp. unit American Airlines and form the world’s largest carrier, cautioned last week that business demand was being pressured by federal spending cuts under the U.S. sequestration process.

Staff furloughs at U.S. air traffic control towers began April 21, causing flight delays at some airports. The Federal Aviation Administration suspended the furloughs after passage last week of a bill allowing the agency to shift money within its budget to halt them.

“We are pleased that the situation is resolved and we have returned to a more normal operating environment,” US Air President Scott Kirby said in the company’s Friday statement.

On Thursday, Delta Air Lines Inc. reported a 2 percent drop in April unit revenue due to soft U.S. demand and unfavorable effects from the weaker yen.

Delta, US Airways top estimates on strong demand

NEW YORK, Wed Jul 25, 2012 – Delta Air Lines and US Airways Group (LCC.N) topped Wall Street’s second-quarter profit estimates on Wednesday on strong passenger revenue, sending the major U.S. carriers’ shares higher.
Delta reported a net loss after it took charges for fuel hedge contracts and staff buyouts, but said it expected a profit for the third quarter.
Maxim Group aerospace specialist Ray Neidl said higher passenger revenue had aided profitability for both companies in the second quarter, which is traditionally a solid one for airlines as travel picks up during warmer months.
“They are selling more expensive seats and less cheap seats,” Neidl said.
On Wednesday, discounter JetBlue Airways said its profit had doubled in the quarter, helped by gains in leisure and business travelers. Southwest Airlines Co. topped earnings estimates last week because of higher fares and robust demand.
Still, Neidl expressed concern that U.S. airlines’ growth would slow after the summer. Oil prices, another wild card, have crept up in recent weeks, although they are still below their highs for the year.
“The question is post-Labor Day and with the weak economy, will airlines have to start discounting to fill seats,” he said.

US Airways says April unit revenue rose 9 percent

PHOENIX, Ariz., Thu May 3, 2012 – U.S. Airways Group Inc. said on Thursday that its unit revenue had increased about 9 percent in April from a year earlier amid higher passenger traffic.

In a monthly operating statement, the airline said passenger traffic had risen 2.1 percent, while it increased its capacity – the number of seats for sale – by 1.6 percent.

The airline said its load factor, which is a measure of how full airplanes are, increased 0.4 percentage point to 83 percent.

Airline shares tumble on oil price rally on stock market

NEW YORK – Airline shares fell broadly on Tuesday, with US Airways Group’s stock leading the decline, as the price of oil rallied, which directly influences the cost of jet fuel.

US Airways shares plummeted 10.4 percent to $7.97 on the New York Stock Exchange. Shares of United Continental Holdings were down 7.78 percent at $21.55, and Delta Air Lines’ shares fell 6 percent to $10.18, both on the NYSE.

U.S. crude oil futures rose $1.52 to $104.76 after trading beyond $105 for the first time since May 2011. The gains followed news on Monday that Iran halted exports to British and French companies ahead of a European Union embargo.

Jet fuel is one of the highest costs for airlines. US Airways, which does hedge its fuel consumption to offset shocks, is more vulnerable than rivals to price spikes, said Basili Alukos, an airline analyst at Morningstar.

The airline industry has been struggling to maintain stability after a years-long downturn that was exacerbated by volatile fuel prices.

AMR bankruptcy could spur more airline consolidation

FORT WORTH ― For US Airways , the merger-hungry fifth-largest U.S. airline, a bankrupt American Airlines may present an irresistible takeover target, but many in the aviation world think the headaches and hassles of consolidation are not worth the payoff of such a tie-up.xxAmerican, a unit of AMR Corp., filed for Chapter 11 bankruptcy protection on Tuesday in a bid to shed some of its uncompetitive costs and restructure its debt.

Bankruptcy leaves the company vulnerable to potential takeover attempts from would-be suitors like US Airways, whose chief executive Doug Parker has long promoted consolidation as a means to slim down an industry plagued by overcapacity. US Airways once tried and failed to buy Delta Air Lines as it restructured in bankruptcy.xxSince the Delta/Northwest and United/Continental mergers, American and US Airways have been considered logical partners for a potential combination, but analysts have said American’s high labor costs and unresolved contracts with its unions make any deal too difficult to negotiate.xxSweeping cost cuts in bankruptcy could remove one potential hurdle, but analysts and bankers noted that US Airways still has its own challenges of having to integrate labor groups following its 2005 merger with America West Airlines.

“Strategically that’s one of the final combinations that could make sense, but there’s a real issue for US Airways to do a deal, as well as the fact that US Airways is still slightly smaller,” said one industry banker who asked not to be named because he was not authorized to speak with the media.

A second industry banker added: “US Airways still has two airlines. If they can’t combine those two houses, how they can combine with American? Today there is no labor deal at US Airways, and those labor deals still need to be negotiated.”

Analysts also said the benefits of any merger are less clear for American Airlines.

“From the standpoint of US Airways, it would be a huge opportunity,” said airline industry consultant Robert Mann. “It would take them into markets they don’t have access to today from a hub standpoint.

“Looking at it from the American Airlines’ perspective, it doesn’t make the combined American and US Airways network competitive with Delta or United (Airlines),” he said.

xFor a merger to appeal to American Airlines, Mann said, it would have to bolster American’s international routes. American Airlines is a global airline that hopes to lure business travelers with international partnerships and a hub-and-spoke model that focuses on cities that are major business centers.

US Airways has a strong presence on the U.S. East Coast but has less to offer in foreign markets.

Airlines in bankruptcy are logical targets for a rival willing to attempt a takeover, because the would-be acquirer can present a proposal to a committee of airline creditors rather than directly to the management team, which might be less inclined to take the deal.

Bankrupt airlines also are attractive takeover targets because they have court protection to cut costs and restructure debt.

Neither American nor US Airways would comment on merger prospects on Thursday.