Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: WEDNESDAY, September 6, 1995 TAG: 9509060146
SECTION: BUSINESS PAGE: B7 EDITION: METRO
SOURCE: THE WASHINGTON POST
DATELINE: WASHINGTON LENGTH: Medium
USAir Group Inc. issued a statement saying traffic and revenue were up more than expected and costs had increased less than expected. That means a profit for the third quarter, and ``barring any unforeseen events, for the full year as well,'' the airline said.
USAir stock rose $1.75 to $9.75 a share on the news, which was released before markets opened.
``The revenue trend that began earlier this year has continued through the summer,'' said USAir Chairman Seth E. Schofield.
Schofield also said the airline is preparing to make its first employee profit-sharing payments under a 1992 salary-reduction agreement. He said the company is taking a charge for the profit-sharing payments ``since we now believe it is likely the company will show a profit for the year.''
Following $2.5 billion in losses over five years, USAir turned its first quarterly profit in the second quarter of this year - $112.9 million. Some analysts had predicted the airline would slip back into losses later in the year.
USAir failed to persuade its unions this year to make $500 million a year in contract concessions over five years, but it pressed ahead toward a similar amount of internal cost savings. USAir said it would seek the concessions when its union contracts are renegotiated.
The airline also made route cuts, concentrating on more profitable routes. Not only did traffic increase, but the airline - with the demise of low-fare competitor Continental Lite and in the absence of cutthroat fare wars - was able to increase its yield per ticket.
by CNB