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STATESWEST ANNOUNCES FIRST QUARTER RESULTS AND JANUARY STATISTICS

STATESWEST ANNOUNCES FIRST QUARTER RESULTS AND JANUARY STATISTICS
 PHOENIX, Feb. 10 /PRNewswire/ -- StatesWest Airlines Inc. (NASDAQ: SWAL, SWALP) announced a net loss of $996,000, or $.18 per share for its first fiscal quarter ended Dec. 31, 1991, compared with a net loss for the quarter ended Dec. 31, 1990, of $1,622,000, or $.37 per share. Total operating revenues for the current quarter were $6,580,000, a 61.5 percent increase over the revenues of $4,058,000 during the first quarter of the prior year. The reduced net loss was principally the result of a 53.5 percent increase in ASMs and a 5.9 percent increase in load factor, while operating expenses increased only 35.8 percent in comparison to the prior period.
 "First quarter operating trends were extremely encouraging and we expect further increases in passenger enplanements, revenue passenger miles and load factor as our relationships with USAir and Northwest Airlines continue to develop," said Rudy R. Miller, chairman of StatesWest. "At the same time, we will constantly analyze opportunities to reduce operating expenses and increase yield. With anticipated growth in passenger revenues, recent fare increases and stabilized fuel prices, we believe that we will achieve profitability by the third quarter of fiscal 1992."
 At Dec. 31, 1991, the company had a working capital deficit of $2.8 million, a current ratio of .62 to 1.00, and negative stockholders' equity of $692,000. The company requires infusion of additional cash resources. The company had intended to redeem its Class B Warrants in mid-February, but the conditions to redemption are not currently satisfied. Accordingly, the company announced that it has temporarily reduced the exercise price of the Class B Warrants to $.65 from $.75 until March 13, 1992, in order to encourage early exercise by Class B Warrantholders. If all of the 1,904,955 outstanding Class B Warrants were exercised, at the reduced price, the proceeds to the company would be approximately $1,200,000. The company intends to redeem any Class B Warrants which are not exercised as soon as possible after the conditions to redemption have been met. The company is also pursuing the exercise of its 1987 Series A Warrants and the conversion of $1,245,000 of convertible subordinated debt to equity, in connection with which the company would receive $1,245,000 cash in repayment of amounts owed to the company by the convertible debt holder. In order to address short-term cash flow issues, the company has entered into negotiations to establish a receivable based financing line.
 The company had anticipated making a preferred stock dividend payment on or about Feb. 5, 1992, from cash escrowed from its February 1991 public offering proceeds. However, after completing its preliminary financial review of the quarter ended Dec. 31, 1991, the company determined that it did not have surplus or earnings legally available to pay the dividend in accordance with Delaware corporate law. The company intends to make preferred stock dividend payments as soon as it is legally permitted.
 StatesWest, operating under code-share agreements with both USAir and Northwest Airlines, has one of the most fuel efficient fleets of prop-jet aircraft in the United States. The airline operates more than 4,000 monthly departures serving 14 cities in California, Arizona and Nevada.
 The following is a summary of the first quarter results for the fiscal years 1992 and 1991.
 STATESWEST AIRLINES FINANCIAL SUMMARY
 First Quarter
 (unaudited)
 Dec. 31,
 1991 1990
 Operating revenues (000) $6,580 $4,058
 Operating expenses (000) 7,102 5,230
 Operating loss (000) (522) (1,172)
 Net loss (000) (996) (1,622)
 Net loss per common share ($.18) ($.37)
 Average shares outstanding 6,267,005 4,351,455
 STATESWEST AIRLINES OPERATING RESULTS
 Percent
 1991 1990 change
 Passenger enplanements 89,381 55,303 +61.6
 Available seat miles
 (ASM) (000) 33,512 21,829 +53.5
 Revenue passenger
 miles (RPM) (000) 14,730 8,315 +77.1
 Load factor (percent) 44.0 38.1 +5.9 pts.
 STATESWEST AIRLINES OPERATING RESULTS
 FOR THE MONTH OF JANUARY 1992 AND 1991
 Percent
 1992 1991 change
 Passenger enplanements 23,907 17,548 +36.2
 Available seat miles
 (ASM) (000) 10,194 9,491 +7.4
 Revenue passenger miles
 (RPM) (000) 3,568 3,115 +14.5
 Load factor (percent) 35.0 32.8 +2.2 pts.
 -0- 2/10/92
 /CONTACT: Rudy R. Miller or Mary A. Nance of StatesWest Airlines, 602-225-0504/
 (SWAL SWALP) CO: StatesWest Airlines, Inc. ST: Arizona IN: AIR SU: ERN


JL-AL -- LA038 -- 8457 02/10/92 16:36 EST
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Date:Feb 10, 1992
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