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ALASKA AIR GROUP REPORTS THIRD QUARTER PROFIT

 SEATTLE, Oct. 21 /PRNewswire/ -- Alaska Air Group Inc. (NYSE: ALK; PSE), posted its first profitable quarter in two years. The company reported a third quarter net profit of $8.0 million compared to a loss of $2.2 million last year. Primary earnings per share were $.60 ($.47 fully diluted) compared with last year's loss of $.29 per share (both primary and fully diluted).
 Revenues in the third quarter rose to $323.4 million from $321.1 million last year on a 2 percent increase in passenger traffic. Operating expenses dropped 5 percent or $14.6 million to $302.7 million. And operating profit increased to $20.7 million from $3.8 million last year.
 Passenger yields (a measure of the average ticket price) decreased 2 percent from the prior year. Revenue passenger miles (traffic) increased 2 percent while available seat miles (capacity) increased 5 percent.
 "Despite pricing pressure that kept fares below last summer's level, we are encouraged by the substantial improvement in our profitability, which reflects the cost reduction measures taken earlier in the year," said Raymond J. Vecci, chairman and chief executive officer. Vecci said operating expenses for the first nine months of 1993 were down $46.6 million from 1992. In the third quarter, Alaska Airlines' unit costs declined 12 percent to 8.9 cents per available seat mile. Including Horizon, the consolidated cost per seat mile declined to 10 cents from 11 cents. "Our ongoing efforts to further cut costs and improve operating efficiencies will continue these trends," said Vecci. "We are also pleased with the excellent customer response to the new Reno, Las Vegas, and Sacramento service introduced by Alaska Airlines this summer," said Vecci.
 For the nine months ended Sept. 30, 1993, the company reported a net loss of $10.6 million, or $.98 per share, compared to a net loss of $35.7 million, or $3.06 per share for the 1992 period. Including an accounting change, last year's nine-month loss was $40.2 million, or $3.40 per share. Passenger traffic declined 7 percent for the period, but operating revenues were almost equal to last year due to the 5 percent increase in yields. Operating expenses were $845.2 million, a 5 percent decrease from the $891.8 million for the 1992 nine-month period.
 Both Alaska Airlines and Horizon Air showed improvements in year-to-date operating results. For the nine months ended Sept. 30, 1993, Alaska posted a pretax loss of $14.5 million, compared to $51.2 million for the 1992 period. Operating expenses were down $56.9 million. Horizon's year-to-date pretax profit was $6.6 million, compared to $3.7 million for the 1992 period.
 Alaska Air Group Inc. is the parent company of Alaska Airlines Inc. and Horizon Air Industries Inc.
 ALASKA AIR GROUP, INC.
 CONSOLIDATED STATEMENT OF INCOME
 (In thousands, except per share)
 Quarter Ended Nine Months Ended
 Sept. 30 Sept. 30
 1993 1992 1993 1992
 Operating Revenues:
 Passenger $ 289,468 $ 289,276 $ 760,526 771,861
 Freight and mail 22,773 22,251 59,456 56,389
 Other 11,145 9,560 31,129 28,190
 Total operating
 revenues 323,386 321,087 851,111 856,440
 Operating Expenses:
 Wages and benefits 95,583 95,760 275,581 275,126
 Aircraft fuel 40,189 47,628 106,230 125,085
 Aircraft maintenance 18,154 20,463 52,530 66,073
 Aircraft rent 39,837 33,719 114,525 89,383
 Commissions 22,844 24,952 61,736 66,558
 Depreciation and
 amortization 14,522 14,076 43,379 42,066
 Other 71,570 80,696 191,207 227,520
 Total operating
 expenses 302,699 317,294 845,188 891,811
 Operating Income
 (Loss) 20,687 3,793 5,923 (35,371)
 Interest income 1,731 1,847 5,470 5,503
 Interest expense (9,280) (10,659) (28,396) (32,269)
 Interest capitalized 112 1,865 333 6,458
 Other income - net 754 (305) 2,026 211
 (6,683) (7,252) (20,567) (20,097)
 Income (loss) before tax
 and accounting change 14,004 (3,459) (14,644) (55,468)
 Income tax expense (credit) 5,976 (1,244) (4,050) (19,797)
 Income (loss) before
 accounting change 8,028 (2,215) (10,594) (35,671)
 Cumulative effect of
 accounting change
 (FAS 106) -- -- -- (4,567)
 Net Income (Loss) $ 8,028 $ (2,215) $ (10,594) $ (40,238)
 Earnings (Loss) Per Share
 Calculations:
 Primary -
 Income (loss) before
 accounting change $ 8,028 $ (2,215) $ (10,594) $ (35,671)
 Preferred stock dividends -- (1,681) (2,525) (5,007)
 Income (loss) before
 accounting change
 applicable to
 common shares 8,028 (3,896) (13,119) (40,678)
 Cumulative effect of
 accounting change -- -- -- (4,567)
 Net income (loss)
 applicable to
 common shares $ 8,028 $ (3,896) $ (13,119) $ (45,245)
 Avg common shares
 outstanding (000) 13,348 13,320 13,339 13,306
 Income (loss) per
 common share:
 Income (loss) before
 accounting change $ .60 $ (.29) $ (.98) $ (3.06)
 Cumulative effect of
 accounting change -- -- -- (.34)
 Net income (loss) per
 share $ .60 $ (.29) $ (.98) $ (3.40)
 Anti- Anti- Anti-
 Fully Diluted $ .47 dilutive dilutive dilutive
 ALASKA AIR GROUP INC.
 CONSOLIDATED BALANCE SHEET
 (In thousands)
 Sept. 30, Dec. 31,
 1993 1992
 Cash and marketable securities $ 99,017 $ 83,431
 Total current assets $ 258,672 $ 250,485
 Property and equipment-net 740,232 790,910
 Other assets 168,682 166,963
 Total assets $ 1,167,586 $ 1,208,358
 Current liabilities $ 323,585 $ 335,718
 Long-term debt and capital
 lease obligations 537,238 487,847
 Other liabilities 119,915 126,834
 Redeemable convertible preferred
 stock -- 61,235
 Shareholders' equity 186,848 196,724
 Total liabilities and capital $ 1,167,586 $ 1,208,358
 AIRLINE DATA -- Selected airline data follows
 Quarter Ended Sept. 30 Alaska Horizon
 1993 1992 1993 1992
 Financial Data ($000):
 Operating revenues $ 261,829 $ 263,911 $ 62,114 $ 57,441
 Operating expenses 245,868 266,686 57,178 50,908
 Operating income (loss) 15,961 (2,775) 4,936 6,533
 Other expense (4,601) (4,332) (187) (505)
 Income (loss) before
 tax $ 11,360 $ (7,107) $ 4,749 $ 6,028
 Operating Data
 Revenue passengers(000) 2,004 1,933 818 707
 RPMs (000,000) 1,739 1,715 165 145
 ASMs (000,000) 2,760 2,652 272 241
 Passenger load
 factor (percents) 63.0 64.6 60.7 60.2
 Breakeven load
 factor (percents) 60.0 67.6 55.4 53.0
 Revenue per psgr mile
 (cents) 13.2 13.7 35.8 37.8
 Operating cost per ASM
 (cents) 8.9 10.1 21.0 21.2
 Nine Months Ended Sept. 30 Alaska Horizon
 1993 1992 1993 1992
 Financial Data ($000):
 Operating revenues $ 684,638 $ 702,193 $ 167,640 $ 154,830
 Operating expenses 684,956 741,858 160,461 149,661
 Operating income (loss) (318) (39,665) 7,179 5,169
 Other expense (14,145) (11,577) (604) (1,457)
 Income (loss) before
 tax $ (14,463) $ (51,242) $ 6,575 $ 3,712
 Operating Data:
 Revenue passengers (000) 4,646 4,919 2,011 1,781
 RPMs (000,000) 4,032 4,383 409 364
 ASMs (000,000) 6,992 7,447 731 677
 Passenger load
 factor (percents) 57.7 58.9 55.9 53.7
 Breakeven load
 factor (percents) 60.0 65.4 53.4 52.4
 Revenue per psgr
 mile (cents) 14.9 14.3 39.1 40.5
 Operating cost per
 ASM (cents) 9.8 10.0 21.9 22.1
 ALASKA AIR GROUP IN
 AIRLINE DATA -- Selected airline data follows (continued)
 Quarter Ended Sept. 30 Total(A)
 1993 1992
 Financial Data ($000):
 Operating revenues $ 323,386 $ 321,087
 Operating expenses 302,699 317,294
 Operating income (loss) 20,687 3,793
 Other expense (6,683) (7,252)
 Income (loss) before tax $ 14,004 $ (3,459)
 Operating Data
 Revenue passengers (000) 2,822 2,640
 RPMs (000,000) 1,904 1,860
 ASMs (000,000) 3,032 2,893
 Passenger load
 factor (percents) 62.8 64.3
 Breakeven load
 factor (percents) 59.3 65.0
 Revenue per psgr mile (cents) 15.2 15.6
 Operating cost per ASM (cents) 10.0 11.0
 Nine Months Ended Sept. 30 Total(A)
 1993 1992
 Financial Data ($000):
 Operating revenues $ 851,111 $ 856,440
 Operating expenses 845,188 891,811
 Operating income (loss) 5,923 (35,371)
 Other expense (20,567) (20,097)
 Income (loss) before tax $ (14,644) $ (55,468)
 Operating Data:
 Revenue passengers (000) 6,656 6,700
 RPMs (000,000) 4,440 4,747
 ASMs (000,000) 7,723 8,124
 Passenger load factor (percents) 57.5 58.4
 Breakeven load factor (percents) 58.8 63.3
 Revenue per psgr mile (cents) 17.1 16.3
 Operating cost per ASM (cents) 10.9 11.0
 (A) The "Total" columns include nonairline entities where appropriate.
 -0- 10/21/93
 /CONTACT: J. Ray Vingo, 206-433-3232, of Alaska Air Group, or Lou Cancelmi of Alaska Airlines, 206-433-3170, /
 (ALK)


CO: Alaska Air Group; Alaska Airlines Inc. ST: Washington IN: AIR SU: ERN

RB -- SE002 -- 5077 10/21/93 10:32 EDT
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Date:Oct 21, 1993
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