America West posts strong 2Q profit
America West Airlines Thursday posted stronger than expected second-quarter results, with the airline's earnings per share easily exceeding Wall Street expecations despite a 43 percent gain in fuel prices.
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America West (NYSE: AWA) reported net income of $13.9 million, or 29 cents per share, up from net income of $10.7 million, or 20 cents per share, in the second quarter of 2004.
The consensus of Wall Street analysts was for America West to post earnings per share of 13 cents.
Revenue for the quarter was $833 million, up from $694 million in the year-earlier period.
The net income figures included a $2.7 million unrealized loss associated with the airline's fuel hedging transactions and a $4.3 million loss on the sale and leaseback of an aircraft acquired during the quarter. The second quarter 2004 net income included a $7.2 million unrealized gain on fuel hedging transactions. Excluding the one-time items, the airline said, net income would have been $20.9 million, or 41 cents per share, up from $3.5 million, or 7 cents per share, in 2004.
"We are pleased to report an inprovement in year-over-year earnings despite a 43 percent increase in fuel price," said Doug Parker, America West's chairman and chief executive. "We are particularly pleased with our nearly 12 percent improvement in passenger revenue per available seat mile, which we believe will be the greatest improvement by any major carrier."
During the quarter the airline's load factor, or percentage of seats filled, rose to 82.3 percent from 78.3 percent in 2004. Revenue passenger miles were up 8 percent, while the available seat capacity was up only 2.7 percent in the quarter, helping the load factor increase.
The airline's fuel expenses increase was softened by its hedging of 58 percent of its fuel during the second quarter 2005. America West realized gains of $11.4 million to reduce total fuel expense.
"While we are pleased with our revenue performance, these improvements are not enough to offset the ongoing high price of fuel," said Derek Kerr, America West's chief financial officer. "Fuel expense for the quarter was the company's greatest expense item, exceeding even salaries and benefits for only the second time in company history, and we do not see this trend altering itself in the forseeable future."
Parker said that America West's proposed merger with US Airways (OTCBB: UAIRQ), announced in May, is on track and is expected to close in the fall.
Tempe-based America West serves more than 90 destinations in the U.S., Canada, Mexico and Costa Rica.
America West Airlines Thursday posted stronger than expected second-quarter results, with the airline's earnings per share easily exceeding Wall Street expecations despite a 43 percent gain in fuel prices.
Recent Company News
» America West Airlines
» US Airways
Latest News
» Mobile Mini gains on industry growth
» Meritage sets earnings record
» United flight attendants threaten 'chaos'
» Paradise Valley, Mesa stores to close
» Pulte's quarterly revenue jumps 31 percent
More
» Companies in the News
» People in the News
America West (NYSE: AWA) reported net income of $13.9 million, or 29 cents per share, up from net income of $10.7 million, or 20 cents per share, in the second quarter of 2004.
The consensus of Wall Street analysts was for America West to post earnings per share of 13 cents.
Revenue for the quarter was $833 million, up from $694 million in the year-earlier period.
The net income figures included a $2.7 million unrealized loss associated with the airline's fuel hedging transactions and a $4.3 million loss on the sale and leaseback of an aircraft acquired during the quarter. The second quarter 2004 net income included a $7.2 million unrealized gain on fuel hedging transactions. Excluding the one-time items, the airline said, net income would have been $20.9 million, or 41 cents per share, up from $3.5 million, or 7 cents per share, in 2004.
"We are pleased to report an inprovement in year-over-year earnings despite a 43 percent increase in fuel price," said Doug Parker, America West's chairman and chief executive. "We are particularly pleased with our nearly 12 percent improvement in passenger revenue per available seat mile, which we believe will be the greatest improvement by any major carrier."
During the quarter the airline's load factor, or percentage of seats filled, rose to 82.3 percent from 78.3 percent in 2004. Revenue passenger miles were up 8 percent, while the available seat capacity was up only 2.7 percent in the quarter, helping the load factor increase.
The airline's fuel expenses increase was softened by its hedging of 58 percent of its fuel during the second quarter 2005. America West realized gains of $11.4 million to reduce total fuel expense.
"While we are pleased with our revenue performance, these improvements are not enough to offset the ongoing high price of fuel," said Derek Kerr, America West's chief financial officer. "Fuel expense for the quarter was the company's greatest expense item, exceeding even salaries and benefits for only the second time in company history, and we do not see this trend altering itself in the forseeable future."
Parker said that America West's proposed merger with US Airways (OTCBB: UAIRQ), announced in May, is on track and is expected to close in the fall.
Tempe-based America West serves more than 90 destinations in the U.S., Canada, Mexico and Costa Rica.
