U Reports 4th Qtr Results

[BoeingBoy]

US AIRWAYS GROUP, INC. REPORTS FOURTH QUARTER RESULTS

$236 Million Net Loss for the Quarter; $611 Million Net Loss for Full Year 2004

Mainline Cost per Available Seat Mile, Excluding Fuel, Down 14 percent to 8.79 cents

ARLINGTON, Va., Jan. 31, 2005 -- US Airways Group, Inc. today reported a net loss of $236 million for the fourth quarter 2004, compared to a $98 million net loss for the fourth quarter 2003. The fourth quarter 2004 pre-tax loss of $238 million compares to a pre-tax loss of $99 million for the same quarter in 2003. Excluding unusual items, the pre-tax loss for the fourth quarter 2004 was $214 million compared to $129 million in 2003 (see Note 5 for reconciliation).

Company Press Release

Jim

 

[PSA1979]

What's the Union employees salary figure for the 4th quarter? Is it right around 236 million? If so, then there's the answer, let's all work for free, then there won't be any loss, of course, there won't be a profit either! We are doomed! It's not the employees, it's the failed business plan, if there even is one!

 

[unit4clt]

As long as US can depend on its unions to subsidize a failing business plan they will continue replacing mainline aircraft with RJ's. No surprise here.

 

[etops1]

What's the Union employees salary figure for the 4th quarter? Is it right around 236 million? If so, then there's the answer, let's all work for free, then there won't be any loss, of course, there won't be a profit either! We are doomed! It's not the employees, it's the failed business plan, if there even is one!

[post="244049"][/post]​

i am surprised to read such negative statement from you. anyway, hope your doing well.

 

[nycbusdriver]

What's the Union employees salary figure for the 4th quarter? Is it right around 236 million? If so, then there's the answer, let's all work for free, then there won't be any loss, of course, there won't be a profit either! We are doomed! It's not the employees, it's the failed business plan, if there even is one!

[post="244049"][/post]​

No. I disagree. If working for free can keep the airline alive, it's imperative that we do it. How else can we secure the birthright of every U.S. resident to fly from Allentown to Las Vegas for $19?

Get with the program!!!

 

[wench]

And...as long as the jackass's threaten us WITH GIVEBACKS( I VOTED NO IN EVERY ONE)<
They will keep posting LOSSES Until 2011...

WAKEUP PEOPLE>

 

[FM2436]

There was alot of bad press about threats of liquidation, strikes, CHASO, and the Christmas meltdown. Could that of had an impact on revenues. Weren't travel agents booking passengers way from US Airways because US Airways was suppose to have shut its doors by now. It will be interesting to see passenger confidence in US Airways in the spring and early summer. At least the 8.79 cents CASM is impressive.

 

[BoeingBoy]

OK, I see the problem with attaching the consolidated statement of operations - the board won't let me attach an Excel file.

In the company press release (the link in the post that started this thread) there is a link at the bottom for the consolidated statement of operations. Anyone interested can use that.

Jim

 

[PSA1979]

i am surprised to read such negative statement from you. anyway, hope your doing well.

[post="244058"][/post]​

etops,
If I see a viable business plan, then I will be gung ho to get it going. But so far the only plan I have seen is more employee give backs. The PHL hub is a night mare, everyday FLL has airtraffic delays due to saturation, we are giving back 25 737's and adding a few E170's (that mainline isn't flying may I add). Will the bk judge allow US to pay off employees to quit? Or is he going to say that the creditors need to be paid prior to any buyouts? I am not by nature a negative person and I am here for the duration. I would love to see this company survive and be the hybrid LCC/Legacy to prove everyone wrong. But, (and a big BUT) show me the plan, start making important changes right now, and quit blaming everyone else. Oil is not going down to $30 a barrel soon. Let's start getting the other costs down. RIGHT NOW, not next month or next year!!!!

 

[funguy2]

To me, there are a few interesting things in these results:

1. U Group lost 236Net and 142Operating. US Airways, Inc (which I presume includes MidAtlantic, with the exception of CASM figures, since they specifically denote that later) lost 218net and 128Operating. This implies that Express lost between $15 and $20mil, depending on Net or Operating.

2. CASM, while still high, is within comparable range, and better than NW's:

Airline (Mainline only) - CASM - CASM ex-fuel
NW - 11.36cents - 8.87cents
US - 10.96 - 8.79
AS - 10.79 - 7.83
UA - 10.68 - 8.34
DL - 10.40 - not listed
AA - 10.25 - not listed
CO - 9.98 - 7.82
FL - 8.32 - 6.00
HP - 7.98 - 6.00
WN - 7.59 - 6.22
B6 - 6.32 - 4.74

So, $1.1bil in annual concessions represents about 15% of total costs. Thus, we can expect CASM (all else equal) to drop by about 15% next quarter. That would be 9.31cents CASM and 7.47cents CASM ex-fuel. So, the concessions get US Airways firmly to the lowest cost legacy carrier and within 15% of the LCC's. Of course, the employee concessions were the "easy" 15% from management's standpoint. Other structural changes to get more is much more difficult to acheive.

Again, the problem with this for US Airways is that mainline capacity is being reduced, and higher cost E170's and CRJ700's are being added.

There is proof here that US Airways is making strides. I am surprised at my own "guesstimates" for CASM including the concessions. On the cost side, the company is coming close to being positioned for success.

I guess the questions now revolve around the revenue impact of the DAL restructuring. It seems clearer to me now, that DAL's fare restructure is a full assault on US Airways. An attempt by DAL to get US Airways' cash balance even lower, before it can attempt to generate cash using the new, lowered cost structure. Its become a game of chicken, with the goal to be that US Airways goes away.

US Airways prospects today are much brighter than three months ago... Although, again, success is not assured. The new reduced revenue picture, particularly at smaller cities where US Airways was not competing as intensely on price (the Binghamtons, and Roanoake, and Charlestons), remains gloomy, and thanks to Delta, a wild card.

 

[usairways_vote_NO]

Get ready for round 4 who votes yes again?

 

[BoeingBoy]

So, $1.1bil in annual concessions represents about 15% of total costs. Thus, we can expect CASM (all else equal) to drop by about 15% next quarter. That would be 9.31cents CASM and 7.47cents CASM ex-fuel. So, the concessions get US Airways firmly to the lowest cost legacy carrier and within 15% of the LCC's. Of course, the employee concessions were the "easy" 15% from management's standpoint. Other structural changes to get more is much more difficult to acheive.

[post="244078"][/post]​

The only thing I can see that you might want to consider (and if you have, forgive me) is that concessions in some form were in place for 2/3 of the 4th quarter - Nov and Dec.

Admittedly, for most except ALPA, they were the interim cuts ordered by the judge, but those provide more short term savings than most of the agreements call for.

In short, expecting a 15% drop in expenses in the 1st quarter 05 (vs 4th quarter 04) is probably unrealistic.

Jim

 

[SVQLBA]

To me, there are a few interesting things in these results:

[snip]
2. CASM, while still high, is within comparable range, and better than NW's:

Airline (Mainline only) - CASM - CASM ex-fuel
NW - 11.36cents - 8.87cents
US - 10.96 - 8.79
AS - 10.79 - 7.83
UA - 10.68 - 8.34
DL - 10.40 - not listed
AA - 10.25 - not listed
CO - 9.98 - 7.82
FL - 8.32 - 6.00
HP - 7.98 - 6.00
WN - 7.59 - 6.22
B6 - 6.32 - 4.74

[snip]

[post="244078"][/post]​

You also have to remember that avg stage length for US is still very short -- 757 nm in Q4 vs 950 or so for NW, 100+ for DL , higher for UA, AA, CO etc. So getting below NW's costs is no mean feat. (Delta Mainline CASM, not consolidated, was 9.75 c/ASM, BTW)

There's still a big gap to Soyuthwest which, of course, operates at even shorter stage lengths.

Don't look at CASM numbers without looking at the stage-lengths. If UA, AA, and CO were operating US stage lengths they'd probably have higher CASM's right now.

 

[genejockey]

Well that does it! In lieu of the 4Q results, I am thoroughly convinced that the unionized employees need to pony up some wage & benefit cuts so that "US Airways can live to fight another day". And this time I mean some really significant contributions. None of this 30% crap, I'm talking big time contributions. By the way, June 30, 2005 will be the deadline for the next round of concessions.

I think I have finally got this whole union negotiated wage concession process down now. Upon analyzing the details of the companys demands the union rank and file do the following just like clock work. It is so predictable:

(1) moan, piss, #### and complain about the companys demands
(2) threaten to strike if the company tries to impose any pay/benefit cuts
(3) vote YES in favor of an official strike
(4) vote YES in favor of the companys demands for addtional wage/benefit cuts
(5) act very suprised when they have to live with terms of the contract they voted
YES for
(6) repeat this process over and over and over and over......

BOHICA my friends.........BOHICA

 

[funguy2]

Boeing Boy... The 15% figure is based on the full $1.1bil/year vs. 7.3bil/year Labor expenses. But you do have a valid point. Also, not all concessions included in that $1.1bil were cash give backs, some were increased productivity. So I guess you could say that 15% is being generous.