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ALASKA AIR GROUP REPORTS SECOND-QUARTER LOSS

 ALASKA AIR GROUP REPORTS SECOND-QUARTER LOSS
 SEATTLE, July 21 /PRNewswire/ -- Alaska Air Group Inc.


(NYSE: ALK; PSE) today reported a second-quarter net loss of $17.8 million, or $1.46 per share (both primary and fully diluted). This compares with a profit of $4.5 million, or 21 cents per share, for the 1991 quarter.
 Despite a 14-percent increase in passenger traffic, operating revenues for the second quarter of 1992 declined to $277.1 million from $278.3 million last year. The traffic gains were offset by a 13-percent decline in yield (the average amount one passenger pays to fly one mile; each one-cent change in yield affects annual revenues by $60 million). The yield for the quarter fell to 16.1 cents from 18.5 cents last year.
 With a 16-percent increase in available seat mile capacity, operating expenses were contained at a 12-percent increase, amounting to $296.2 million, as compared to $264.8 million last year. The pretax loss for the current quarter was $25.9 million compared to a $7.1 million profit for the 1991 period.
 "Heavy fare cuts in Alaska and the continental U.S., coupled with a soft economy and rising fuel prices, converged to produce these severe losses," said Raymond J. Vecci, chairman and chief executive officer.
 For the six months ended June 30, 1992, the company reported a net loss of $33.5 million, or $2.77 per share. This compares with a 1991 first half net loss of $5.5 million, or 67 cents per share. Passenger traffic was up 15 percent for the period, but operating revenues rose only 2 percent to $535.4 million due to the decline in yields. Operating expenses were $574.5 million, a 10-percent increase over the $523.1 million for the 1991 six-month period.
 "In recognition of the economic and competitive climate, we are delaying and reducing capital spending and continuing efforts to contain and lower unit costs. We also have discontinued Los Angeles- Toronto service," Vecci added. "These efforts are continuing as we tailor our operation for the 1992-93 winter period. Because of the overriding impact of pricing, our growth will be cautious in this environment plagued by the desperation-pricing of financially troubled airlines."
 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 Six Months
 Ended June 30: 1992 1991 1992 1991
 Operating Revenues:
 Passenger $248,344 $250,995 $482,585 $474,783
 Freight and mail 18,495 18,219 34,138 34,503
 Other 10,306 9,047 18,630 15,696
 Total operating revenues 277,145 278,261 535,353 524,982
 Operating Expenses:
 Wages and benefits 90,688 82,065 179,366 160,235
 Aircraft fuel 41,807 35,849 77,457 76,448
 Aircraft maintenance 23,133 21,773 45,610 42,724
 Aircraft rent 29,242 25,057 55,664 50,805
 Commissions 21,165 21,533 41,606 40,695
 Depreciation and
 amortization 14,009 13,126 27,990 25,256
 Other 76,152 65,384 146,824 126,952
 Total operating expenses 296,196 264,787 574,517 523,115
 Operating income (loss) (19,051) 13,474 (39,164) 1,867
 Interest income 1,682 2,841 3,656 3,970
 Interest expense (10,794) (10,521) (21,610) (18,599)
 Interest capitalized 2,178 1,753 4,593 3,662
 Other income - net 112 (400) 516 (389)
 Total (6,822) (6,327) (12,845) (11,356)
 Income (loss) before tax (25,873) 7,147 (52,009) (9,489)
 Income tax expense
 (credit) (8,099) 2,668 (18,553) (3,986)
 Net income (loss) $(17,774) $ 4,479 $(33,456) $(5,503)
 Earnings (loss) per common share:
 Primary -
 Net income (loss) $(17,774) $ 4,479 $(33,456) $(5,503)
 Preferred stock dividend (1,663) (1,663) (3,327) (3,309)
 Loss applicable to
 common shares $ (19,437) $ 2,816 $(36,783) $(8,812)
 Average common shares
 outstanding (000) 13,314 13,435 13,298 13,186
 Earnings (loss) per
 common share $ (1.46) $ 0.21 $ (2.77) $ (0.67)
 Fully diluted Anti- Anti- Anti- Anti-
 dilutive dilutive dilutive dilutive
 ALASKA AIR GROUP INC.
 CONSOLIDATED BALANCE SHEET
 (In thousands)
 June 30: 1992 1991
 Cash and marketable securities $ 52,693 $ 143,733
 Total current assets $ 274,256 $ 292,119
 Property and equipment-net 792,836 765,630
 Other assets 164,731 168,929
 Total assets $1,231,823 $1,226,678
 Current liabilities $ 329,223 $ 315,604
 Long-term debt and capital
 lease obligations 496,117 473,715
 Other liabilities 95,783 105,345
 Redeemable convertible preferred stock 61,091 60,803
 Shareholders' equity 249,609 271,211
 Total liabilities and capital $1,231,823 $1,226,678
 AIRLINE DATA
 Selected airline data follows
 Alaska Horizon
 Quarter Ended June 30: 1992 1991 1992 1991
 Financial Data ($000):
 Operating revenues $226,448 $233,776 $50,883 $44,641
 Operating expenses 245,686 222,249 50,131 42,075
 Operating income (loss) (19,238) 11,527 752 2,566
 Other expense (3,890) (4,193) (548) (520)
 Income (loss) before tax $(23,128) $ 7,334 $ 204 $ 2,046
 Operating Data:
 Revenue passengers (000) 1,604 1,511 581 497
 RPMs (000,000) 1,423 1,258 118 99
 ASMs (000,000) 2,477 2,133 227 192
 Passenger load factor (pct) 57.4 59.0 52.2 51.4
 Breakeven load factor (pct) 66.1 57.2 52.1 48.7
 Revenue per psgr mile (cents) 14.1 16.6 40.9 42.8
 Operating cost per ASM (cents) 9.9 10.4 22.1 21.9
 Alaska Horizon
 Six Months Ended June 30: 1992 1991 1992 1991
 Financial Data ($000):
 Operating revenues $438,282 $439,207 $97,389 $86,060
 Operating expenses 475,172 438,129 98,753 84,235
 Operating income (loss) (36,890) 1,078 (1,364) 1,825
 Other expense (7,245) (8,315) (952) (1,145)
 Income (loss) before tax $(44,135) $ (7,237) $(2,316) $ 680
 Operating Data:
 Revenue passengers (000) 2,986 2,795 1,073 913
 RPMs (000,000) 2,668 2,339 219 182
 ASMs (000,000) 4,795 4,145 437 373
 Passenger load factor (pct) 55.6 56.4 50.2 48.7
 Breakeven load factor (pct) 64.0 58.1 51.7 48.2
 Revenue per psgr mile (cents) 14.6 16.8 42.2 44.9
 Operating cost per ASM (cents) 9.9 10.6 22.6 22.6
 ALASKA AIR GROUP INC.
 AIRLINE DATA (continued)
 Total(A)
 Quarter Ended June 30: 1992 1991
 Financial Data ($000):
 Operating revenues $277,145 $278,261
 Operating expenses 296,196 264,787
 Operating income (loss) (19,051) 13,474
 Other expense (6,822) (6,327)
 Income (loss) before tax $(25,873) $ 7,147
 Operating Data:
 Revenue passengers (000) 2,185 2,008
 RPMs (000,000) 1,541 1,357
 ASMs (000,000) 2,704 2,325
 Passenger load factor (pct) 57.0 58.4
 Breakeven load factor (pct) 63.8 56.4
 Revenue per psgr mile (cents) 16.1 18.5
 Operating cost per ASM (cents) 10.9 11.4
 Total(A)
 Six Months Ended June 30: 1992 1991
 Financial Data ($000):
 Operating revenues $535,353 $524,982
 Operating expenses 574,517 523,115
 Operating income (loss) (39,164) 1,867
 Other expense (12,845) (11,356)
 Income (loss) before tax $(52,009) $(9,489)
 Operating Data:
 Revenue passengers (000) 4,059 3,709
 RPMs (000,000) 2,887 2,521
 ASMs (000,000) 5,232 4,518
 Passenger load factor (pct) 55.2 55.8
 Breakeven load factor (pct) 62.1 57.0
 Revenue per psgr mile (cents) 16.7 18.8
 Operating cost per ASM (cents) 11.0 11.6
 (A) The "Total" columns include nonairline entities where appropriate.
 -0- 7/21/92
 /CONTACT: J. Ray Vingo, 206-433-3232, or Lou Cancelmi, 206-433-3170, both of Alaska Air Group/
 (ALK) CO: Alaska Air Group Inc; Alaska Airline Inc.; Horizon Air Industries
 Inc. ST: Washington IN: AIR SU: ERN


LM -- SE004 -- 1221 07/21/92 10:34 EDT
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