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Airline Finance News - North America.

For more airline finance news, data and analysis, please go to: http://www.airguideonline.com/professional.htm Aug 14, 2006

MarketWatch reported that the Amex airline Index fell to its lowest level in 10 months yesterday before bouncing back to 46.98, up 1.3%. The late recovery mirrored what occurred at airports throughout the US, according to MarketWatch, said that while delays in the morning were "significant," they "smoothed themselves out" as the day wore on and passengers had a better idea of what to expect at security checkpoints. "We haven't had anywhere near the number of cancellations we thought we might have," he said. May said he could not quantify cancellations, delays or their effect on the network, and he was unwilling to speculate about the economic impact on airlines during the first day. He noted that the Transportation Security Administration resumed random gate checks at 25 airports yesterday and said, "There will be significantly more airports covered with gate checks tomorrow" as all domestic flights are subjected to the new security regulations. Aug 11, 2006

US Airlines On Recovery Path Despite Fears. Security fears may dampen demand for air travel in the short term, industry watchers said on Thursday, after British police foiled a plan to blow up transatlantic jets, but they won't throw US airlines off their long recovery from the September 11, 2001 attacks. It took US airlines almost five years to regain pre-2001 passenger levels, as Americans regained a taste for travel, helped on by a resurgent economy and cheaper fares. This summer, several carriers reported their fullest planes on record. The latest travel scare may put a dent in that upswing, as the consequences of the plot unravel, analysts said, but existing concerns about record-high oil prices, an economic slowdown and global security remain more of a threat. Aug 10, 2006

US Airlines Raise Fares By Up To USD$10. US airlines raised fares by up to USD$10 one-way for tickets aimed at business travelers, taking advantage of robust demand at the tail end of the peak summer travel season. US airlines, helped by a cut in domestic capacity and fuller planes, have been raising fares to offset the effect of high fuel prices and boost profits. The most recent round of price increases was about two weeks ago. Aug 7, 2006

Air Canada

Air Canada Jazz reported a second-quarter net profit of C$36.6 million ($32.6 million), doubled from net income of C$18 million in the year-ago period, on a 47.1% jump in operating revenues to C$340.1 million. The Regional attributed the strong results to decreasing all unit costs except aircraft rent and fuel, which surged 91.5% to C$34 million, and a 27.8% increase in block hr. The growth is "mainly due to the eight CRJ200s, 12 CRJ705s and 24 CRJ100s that were received in the last half of 2005 and the first half of 2006," it said. Operating income rose 33.2% to $36.5 million as total expenses climbed 48.9% to $99.8 million. With the addition of the new aircraft, capacity grew 66.8% while CASM excluding fuel fell 18.2%. Aug 11, 2006

Air Canada

Air Canada parent ACE Aviation's outright sale of Air Canada Technical Services and the possibility of further offerings of equity in Aeroplan and Jazz, could eventually mean an end to the holding company structure, ACE Chief Executive Robert Milton said. Investors lauded the plan, driving ACE's B-series shares up CAD$2.09, or 7.5 percent, to CAD$29.99 on the Toronto Stock Exchange, their highest level in more than a month. Montreal-based ACE became Air Canada's publicly traded parent in October 2004 following the airline's lengthy restructuring under bankruptcy protection. The current plan is to reduce ACE's capital by up to CAD$2 billion (USD$1.8 billion) over an indefinite period. Shareholders are slated to meet and review the arrangement in October. The various operating entities can benefit from relationships with each other through operating contracts rather than cross ownership, executives said. Aug 11, 2006

Air Canada

Air Canada parent ACE Aviation's said its jump in second-quarter profit was aided by a big gain from the sale of US Airways shares and higher fares, which offset surging fuel costs. It earned CAD$236 million, up from CAD$169 million a year earlier. The latest quarter included a pretax gain of CAD$100 million on the sale of 3.25 million US Airways Group shares. Net income also included a foreign exchange gain of CAD$107 million. Operating income was CAD$181 million, up CAD$3 million from the second quarter of 2005. Revenue was CAD$2.7 billion, up 8 percent from CAD$2.5 billion. It said system-wide yield improved by 3 percent, despite an increase in fuel costs of CAD$101 million, or 19 percent, as the airline's capacity rose 3 percent. Most of the capacity increase was on international and Western Canadian routes. On Thursday, Aeroplan reported a 25 percent increase in net income and Jazz Air said profit jumped more than 50 percent. Aug 11, 2006

American Airlines, Continental Airlines

There was some market concern that the crisis could help stall carriers' nascent economic recovery as Standard & Poor's Equity Research Services said yesterday afternoon that it lowered its outlook on the airline subindustry to Neutral from Positive. It specifically downgraded American Airlines and Continental Airlines, two of the carriers allegedly targeted by the terrorists, and said, "Given today's attempted attacks against a backdrop of high oil prices heading into a seasonally weaker demand period, we think the risks have become too high to continue to recommend purchase of the shares." Aug 11, 2006

Delta Air Lines

Bankruptcy charges push Delta into $2.2 billion loss as operating result improves. Hit hard by costs associated with its Chapter 11 reorganization, Delta Air Lines yesterday reported a second-quarter net loss of $2.2 billion, widened from a deficit of $382 million in the year-ago period.The airline said it earned $175 million in net income for the quarter excluding restructuring items, reversing a net loss of $304 million excluding special items in the year-ago quarter. "Delta's second quarter results continue to reflect both the solid progress we are making in our restructuring and the substantial challenges we are facing from high fuel prices," CFO Edward Bastian said. "We are aggressively restructuring our business." Aug 10, 2006

Delta Air Lines

Delta Air Lines also reiterated its commitment to restructuring its route network to reduce domestic capacity and expand international operations, although yesterday it announced the launch of a daily Atlantic City-Orlando service from Nov. 15. Delta's international capacity increased 21.5% in the second quarter compared to the previous year. As of June 30, it was operating 65 fewer mainline aircraft compared to last year. Aug 10, 2006

Delta Air Lines

Delta Air Lines CEO Gerald Grinstein said Delta remains "on track" to exit bankruptcy in the first half of 2007. He said termination of its pilots pension plan will be critical to the reorganization effort, although second-quarter earnings were weighed down heavily by a $2.1 billion charge related to the reopening of the pilots' collective bargaining agreement. Aug 10, 2006

Delta Air Lines

Delta Air Lines's operating revenues rose 9.6% to $4.7 billion while expenses fell 2.1% to $4.3 billion, net of a 5.4% fuel cost increase to $1.1 billion, reflecting a 30% rise in cost per gallon offset by an 18.7% reduction in consumption. Operating income was $369 million, nearly a $500 million positive swing from an operating loss of $129 million a year ago. Yield grew 15% to 14.07 cents as RPMs declined 5.1% to 30.1 billion. With capacity down 6.8% to 37.7 billion ASMs, load factor rose 1.4 points to 79.68%, pushing RASM up 17.5% to 12.34 cents while CASM excluding fuel fell 5.5% to 8.42 cents. Aug 10, 2006

Delta Air Lines

Delta Air Lines Posts USD$2.2 Bln Q2 Net Loss Delta on Wednesday posted a wider quarterly loss as it recorded more than USD$2 billion in bankruptcy related costs. Delta, which has been cutting costs and reorganizing operations under bankruptcy protection since last September, reported a quarterly net loss of USD$2.2 billion, compared with a net loss of USD$382 million in the same quarter a year ago. The large quarterly loss was chiefly the result of a USD$2.1 billion charge taken by Delta relating to a collective bargaining agreement it struck with its pilots in May. Excluding reorganization costs, Delta reported income of USD$175 million for the quarter, compared with a loss of USD$304 million on the same basis in the year-ago quarter, helped by some ticket price increases and restructuring its route network. Operating revenues rose 10 percent to USD$4.65 billion. The airline "remains on track to exit bankruptcy in the first half of 2007," said Chief Executive Aug 9, 2006

Delta Air Lines

Delta Air Lines flew 11.76 billion system RPMs in July, a drop of 0.6% from the year-ago month. Capacity fell 2.1% to 13.77 billion ASMs and load factor rose 1.3 points to 85.4%. Domestic RPMs declined 10.6% to 8.03 billion against a 12.6% decrease in ASMs to 9.38 billion. Load factor rose 2 points to 85.7%. International traffic was up 31.3% to 3.73 billion RPMs, capacity grew 31.8% to 4.4 billion ASMs and load factor fell 0.3 point to 84.9%. Aug 8, 2006

Delta Air Lines

Delta Air Lines on Friday filed for final US Bankruptcy Court clearance to terminate its pilots' pension plan effective Sept. 2. The move, which the pilots union has agreed not to oppose, would affect 13,000 active and retired workers and is part of the carrier's effort to cut costs in order to emerge from Chapter 11 bankruptcy protection. Defined retirement programs for 91,000 active and retired flight attendants and ground employees will not be terminated, the airline said. Aug 7, 2006

Delta Air Lines

Delta Air Lines said pension reform legislation passed by the US Senate last week does not mitigate its need to jettison the heavy costs of the pilots' retirement program. The plan's "costs are unaffordable and would prevent the company from successfully reorganizing and emerging from bankruptcy," it said in a statement. "The pilot plan's costs are expected to exceed $1 billion in the near term alone, even if pension reform legislation passed by Congress is signed into law." Aug 7, 2006

Hawaiian Airlines

Hawaiian reports widened second-quarter loss as competition stiffens. Hawaiian Airlines parent Hawaiian Holdings reported a second-quarter net loss of $26.4 million, widened from a net loss of $1.67 million in the year-ago quarter.President and CEO Mark Dunkerley said the carrier's earnings were affected negatively by rising fuel costs and an "increase in competitor capacity" on both inter-island flights and transpacific routes. He acknowledged that Hawaiian's "progress in this quarter has lagged that of several of our competitors." The airline faced new competition during the quarter when Mesa Air Group launched its go! subsidiary on June 9. Aug 9, 2006

Hawaiian Airlines

Hawaiian's operating expenses increased 5.8% to $213.3 million, including a 22.8% rise in fuel costs to $59.2 million. Operating income was $9 million, improved from $155,000 last year. Net income for the quarter was much lower because of a $28 million special charge related to the redemption of outstanding convertible notes and a $4.3 million tax provision, the company said. Yield grew 7.1% to 12.17 cents as RPMs rose 2.6% to 1.66 billion. With capacity up 0.8% to 1.91 billion ASMs, load factor increased 1.5 points to 86.9%, pushing RASM up 9.4% to 11.43 cents while CASM excluding fuel costs fell 0.3% to 7.92 cents. Hawaiian's Dunkerley said the airline is looking forward to deploying four 767-300s it purchased in the first quarter and will take delivery of in the second half. Aug 9, 2006

Hawaiian Airlines

Hawaiian's revenues for the quarter totaled $222.3 million, up 10.2% from the 2005 period. Year-ago figures combine those of Hawaiian Airlines and Hawaiian Holdings, which technically acquired the bankrupt carrier on June 2, 2005, and does not officially include Hawaiian Airlines results from April 1-June 1, 2005, as part of its earnings. Aug 9, 2006

Mesaba Airlines, Big Sky Airlines

MAIR Holdings, parent of Mesaba Airlines and Big Sky Airlines, reported a net loss of $2.5 million for its first fiscal quarter ended June 30 compared to a profit of $1.2 million in the same quarter a year ago. "The company's financial result in the first quarter of fiscal 2007 was primarily the result of additional expenses the company associated with Mesaba's bankruptcy," MAIR President and CEO Paul Foley said. "While Big Sky's financial results improved year-over-year, increased fuel expenses have affected its efforts to reach breakeven results." Operating revenues totaled $6 million compared to restated revenues of $114.6 million for the same period a year ago. Operating loss was $3.7 million. Mesaba Aviation reported a 48.3% drop in net income to $86,000 for the quarter as operating revenues dipped 24.2% to $83.4 million. Operating loss was $1.6 million. ASMs declined 34% to 506 million while RPMs fell 29% to 365.9 million, sending load factor up 5 points to 72.3%. Aug 8, 2006

Northwest Airlines

Northwest Airlines flew 7.31 billion consolidated RPMs in July, a 9.4% decrease from the year-ago month. Capacity fell 11.1% to 8.3 billion ASMs and load factor rose 1.6 points to 88.1%. Domestic traffic declined 9.4% to 4.05 billion RPMs against an 11.8% decrease in capacity to 4.62 billion ASMs, raising load factor 2.3 points to 87.6%. International RPMs dropped 7.7% to 2.78 billion as ASMs fell 8% to 3.04 billion, lifting load factor 0.3 point to 91.3%. Aug 10, 2006

Northwest Airlines

Northwest Airlines received approval yesterday from a US Bankruptcy Court for $1.38 billion in debt refinancing that the carrier said will save it money on interest payments and increase its liquidity. The bankrupt company was allowed to refinance an existing $1.125 billion loan, which reportedly will save it $34 million annually in interest payments and an additional $900 million in debt repayment through 2010, as well as secure a new loan from Citigroup for $250 million to increase its liquidity, according to press reports. The court postponed a ruling on whether NWA's flight attendants can strike in protest of a new labor contract imposed by airline management. The flight attendants, who have rejected two tentative concessions agreements, are threatening unannounced work actions starting Aug. 15. An NWA official told the Associated Press that such work actions "would clearly put us on the brink of collapse and in danger of liquidation." Aug 10, 2006

Northwest Airlines

Judge Delays Ruling On Northwest Strike Issue. A US federal judge on Wednesday delayed a decision on whether flight attendants at bankrupt Northwest Airlines have a right to strike as a means to pressure the company back into contract negotiations. Aug 9, 2006

Northwest Airlines

Northwest Airlines cited several areas of progress, including finalizing concessionary agreements with nearly all of its labor unions. Its flight attendants, however, twice have rejected tentative accords and are threatening a strike. The company also said it has either rejected or entered into "new, more favorable lease or debt arrangements" covering 243 aircraft. It is targeting $400 million in annual fleet ownership cost savings. Aug 8, 2006

Northwest Airlines

Northwest Airlines operating revenues increased 3% to $3.3 billion while expenses decreased 11.5% to $3 billion. Operating income was $295 million, reversing an operating loss of $190 million a year-ago quarter. Yield grew 12% to 13.93 cents as RPMs fell 6.3% to 20.25 billion. With capacity down 9.9% to 23.45 billion ASMs, load factor rose 3.3 points to 86.4%, pushing up RASM 16.1% to 11.41 cents while CASM excluding fuel costs fell 13.1% to 7.44 cents. Aug 8, 2006

Northwest Airlines

Northwest Airlines President and CEO Doug Steenland said yesterday that NWA received a boost when Congress passed pension reform legislation that "will enable [it] to preserve its frozen defined benefit pension plans" and that NWA has achieved $1.4 billion in annual savings, more than halfway to the targeted $2.5 billion. Aug 8, 2006

Northwest Airlines

Northwest Airlines reports $285 million quarterly loss but claims 'steady progress'. Northwest reported a second-quarter net loss of $285 million, widened from $234 million in the year-ago period, but insisted it is making "steady progress" as it works toward emerging from bankruptcy protection.Excluding reorganization-related items, the carrier said it earned $179 million in the period, improved from a net loss of $288 million excluding unusual items last year. Aug 8, 2006 Northwest Airlines

US Senate passes pension overhaul aimed at saving airlines' plans. The US Senate passed legislation late Thursday that significantly reforms US pension law and gives struggling airlines needed extra time to fund defined retirement programs.The bill, identical to one passed by the House in late July, moves to the desk of President Bush, who is expected to sign it into law. Bankrupt Northwest Airlines, a major beneficiary of the legislation, said the new law "will save the pension benefits of 73,000 current and former Northwest employees." Aug 7, 2006

US Airways

Discover the World Marketing said US Airways expanded its agreement to cover the carrier in Australia, China, Hong Kong, Denmark, Finland, Iceland, New Zealand, Norway, Philippines and Taiwan. Discover already represented US in Argentina, Japan, Malaysia, Singapore, South Africa and Uruguay. Aug 8, 2006

WestJet

WestJet flew 894.2 million RPMs in July, an increase of 17% over the year-ago month, against a nearly identical increase in ASMs to 1.1 billion. Load factor inched up 0.2 point to 81.5%. Aug 10, 2006
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Publication:Airguide Online
Geographic Code:1USA
Date:Aug 14, 2006
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