US Airways 8-K Us Airways Group, Inc. Reports Significantly Improved Third Quarter Earnings

EXHIBIT 99.1

Contact: Dan Cravens
480/693-5729

FOR IMMEDIATE RELEASE

US AIRWAYS GROUP, INC. REPORTS SIGNIFICANTLY
IMPROVED THIRD QUARTER EARNINGS

Highlights of the US Airways Group, Inc. (the Company) third quarter 2007 results:

• Net profit for the third quarter 2007 was $177 million, or $1.87 per diluted share versus a net loss of $78 million, or ($0.88) per share for the third quarter 2006.

• Excluding special items, third quarter 2007 net profit was $185 million or $1.96 per diluted share versus a net profit of $101 million or $1.09 per share in 2006.

• On a year to date basis, US Airways has accrued $55 million for its annual employee profit sharing program.

• The Company had $3.1 billion in total cash and investments, of which $0.5 billion was restricted, on September 30, 2007.

TEMPE, Ariz., Oct. 25, 2007 — US Airways Group, Inc. (NYSE: LCC) today reported its third quarter 2007 results. Net profit for the third quarter was $177 million, or $1.87 per diluted share, compared to a net loss of $78 million, or ($0.88) per share for the same period last year. Excluding net special items of $8 million, the Company reported a net profit of $185 million, or $1.96 per diluted share for its third quarter 2007. This compares to a net profit excluding special items of $101 million, or $1.09 per diluted share for the third quarter of 2006, which included $179 million of special items. See the accompanying notes in the Financial Tables section of this press release for a reconciliation of Generally Accepted Accounting Principles (GAAP) financial information to non-GAAP financial information.

US Airways Group Chairman and CEO Doug Parker stated, “We are very pleased to report a sharp improvement in our third quarter earnings. Customer demand has kept pace with supply and the revenue environment has held up well in spite of the credit market challenges and economic uncertainty experienced during the quarter. We are particularly pleased to note that overall industry capacity has remained in check during this period of recovery for our industry, which is a notable change from the past.

“We are especially pleased with the improvement we’ve seen in operating reliability as the result of our operational improvement plan. During September 2007, more than 80 percent of our flights arrived on time and we completed 99 percent of our flights as scheduled. This was our best on-time performance so far in 2007 and the second best month since our merger in September 2005. We have begun the fourth quarter well and are optimistic that we are on track to regain our position as an industry leader in operational reliability.

“Also during the third quarter, we completed the merger of our operating certificates and US Airways now operates under a single operating certificate. This accomplishment reflects two years of effort on the part of many employees to combine policies, procedures, flight operating systems and maintenance standards with the end goal to become one airline in the eyes of the Federal Aviation Administration (FAA). Our team did a fantastic job, and we applaud and recognize their accomplishment of making the cutover seamless for our passengers.

“These results are due to the great work of our 37,000 employees who remain committed to their airline while we complete our integration work and transition back to consistent operating fundamentals. As a result of their efforts, we are producing one of the top profit margins in our industry and have accrued $55 million year-to-date for our employee profit sharing program.

“Looking into the current quarter, demand remains robust and the yield environment also remains strong. Recent fuel price increases remain problematic, but so long as our industry continues its recent capacity restraint we are optimistic about prospects for 2008,” concluded Parker.

Revenue and Cost Comparisons

Mainline passenger revenue per available seat mile (PRASM) was 10.85 cents, up 6.5 percent over the same period last year. Express PRASM was 19.31 cents, up 4.0 percent over the third quarter 2006. Total mainline and Express PRASM for US Airways Group was 12.15 cents, which was up 5.6 percent over the third quarter 2006 on a 2.9 decline in total available seat miles (ASMs).

Mainline cost per available seat mile (CASM) at US Airways Group was 11.11 cents, down 2.6 percent versus the same period last year on a decrease in mainline capacity of 2.4 percent versus the third quarter of 2006. Excluding fuel, unrealized and realized gains/losses on fuel hedging instruments, and merger related transition expenses, mainline CASM was 7.68 cents, up 5.7 percent from the same period last year.

Chief Financial Officer Derek Kerr stated, “Our increase in CASM excluding fuel and special items was largely associated with the implementation of our operational improvement plan. We also pulled capacity down slightly to help ease some of the northeast air traffic control issues and other operational challenges. Because of the short-term nature of this capacity reduction, we were not able to pull out all of the corresponding fixed costs and as a result, experienced an increase in unit costs during the third quarter.

“While clearly not satisfied with our cost performance during the third quarter, we took the steps necessary to improve our operational reliability. We have seen a significant improvement in our operation and anticipate the rate of increase in CASM (excluding fuel and special items) to be lower as we move forward.”

Liquidity

As of Sept. 30, 2007, the Company had $3.1 billion in total cash and investments, of which $0.5 billion was restricted.

Second Quarter Special Items

During its third quarter, the Company recognized $8 million of net special items. Expenses for the quarter included $17 million of merger-related transition expenses and $4 million of special non-cash state tax provision from the utilization of pre-acquisition net operating losses (NOL). These expenses were offset by a $13 million non-cash credit for unrealized net gains associated with the change in fair value of the Company’s outstanding fuel hedge contracts.

Other Notable Accomplishments

Operations

• Marked a significant milestone by obtaining a single operating certificate from the FAA. The single certificate allows US Airways to operate as a single airline with one set of policies, procedures, computer systems, maintenance and flight control systems.

• Hired a new Chief Operating Officer (COO), Robert Isom, who has 15 years of airline experience and most recently served as Chief Restructuring Officer of GMAC, LLC. As COO, Isom oversees the airline’s operations, including flight operations, inflight services, maintenance and engineering, airport customer service, reservations, cargo and the Express operation.

• For the ninth consecutive year, Charlotte’s line maintenance facility earned the FAA’s highest award for excellence in maintenance — the AMT Diamond Award.

• The airline maintenance and reliability groups set a new V2500 engine operating hours performance record with the completion of more than 30,000 flight hours.

• Announced plans to offer recall to all pilots furloughed by pre-merger US Airways, move some 140 pilots at regional partners as part of the jets for jobs program back to mainline, and hire an additional 350 pilots by the end of 2008.

Marketing

• Awarded the right to fly the first ever route between Philadelphia and the Chinese capital city of Beijing by the U.S. Department of Transportation (DOT). The daily service to China will begin in 2009. The flight will originate at the airline’s hub in Charlotte, N.C.

• Announced new codeshare agreement with Air New Zealand, which gives passengers the ability to connect seamlessly between the United States, New Zealand, Australia, and the Pacific Islands from Los Angeles and San Francisco.

• Launched a mobile-device friendly version of usairways.com allowing customers to search for flights, purchase tickets, check flight status, make changes to an existing reservation, and access their Dividend Miles account conveniently with a handheld mobile device.

Analyst Conference Call/Webcast Details

US Airways will conduct a live audio webcast of its earnings call today at 12:30 p.m. EDT, which will be available to the public on a listen-only basis at www.usairways.com under the About US >> Investor Relations tab. An archive of the call/webcast will be available in the Public/Investor Relations portion of the Web site through Nov. 25, 2007.

The airline will also update its investor relations guidance on its Web site (www.usairways.com). Information that could be updated includes cost per available seat mile (CASM) excluding fuel and transition expenses, fuel prices and hedging positions, other revenues, estimated interest expense/income and merger related transition expense guidance. The investor relations update page also includes the airline’s capacity, fleet plan for 2007 and estimated capital spending for 2007.

About US Airways

US Airways is the fifth largest domestic airline employing nearly 37,000 aviation professionals worldwide. US Airways, US Airways Shuttle and US Airways Express operate approximately 3,600 flights per day and serve more than 230 communities in the U.S., Canada, Europe, the Caribbean and Latin America. The new US Airways — the product of a merger between America West and US Airways in September 2005 — is a member of the Star Alliance network, which offers our customers 16,000 daily flights to 855 destinations in 155 countries worldwide. This press release and additional information on US Airways can be found at www.usairways.com. (LCCF)

Forward Looking Statements

Certain of the statements contained herein should be considered “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may be identified by words such as “may,” “will,” “expect,” “intend,” “indicate,” “anticipate,” “believe,” “forecast,” “estimate,” “plan,” “guidance,” “outlook,” “could,” “should,” “continue” and similar terms used in connection with statements regarding the outlook of US Airways Group, Inc. (the “Company”). Such statements include, but are not limited to, statements about expected fuel costs, the revenue and pricing environment, the Company’s expected financial performance and operations, future financing plans and needs, overall economic conditions and the benefits of the business combination transaction involving America West Holdings Corporation and US Airways Group, including future financial and operating results and the combined companies’ plans, objectives, expectations and intentions. Other forward-looking statements that do not relate solely to historical facts include, without limitation, statements that discuss the possible future effects of current known trends or uncertainties or which indicate that the future effects of known trends or uncertainties cannot be predicted, guaranteed or assured. Such statements are based upon the current beliefs and expectations of the Company’s management and are subject to significant risks and uncertainties that could cause the Company’s actual results and financial position to differ materially from the Company’s expectations. Such risks and uncertainties include, but are not limited to, the following: the impact of high fuel costs, significant disruptions in the supply of aircraft fuel and further significant increases to fuel prices; our high level of fixed obligations and our ability to obtain and maintain financing for operations and other purposes; our ability to achieve the synergies anticipated as a result of the merger and to achieve those synergies in a timely manner; our ability to integrate the management, operations and labor groups of US Airways Group and America West Holdings; labor costs and relations with unionized employees generally and the impact and outcome of labor negotiations; the impact of global instability, including the current instability in the Middle East, the continuing impact of the military presence in Iraq and Afghanistan and the terrorist attacks of September 11, 2001 and the potential impact of future hostilities, terrorist attacks, infectious disease outbreaks or other global events that affect travel behavior; reliance on automated systems and the impact of any failure or disruption of these systems; the impact of future significant operating losses; changes in prevailing interest rates; our ability to obtain and maintain commercially reasonable terms with vendors and service providers and our reliance on those vendors and service providers; security-related and insurance costs; changes in government legislation and regulation;

our ability to use pre-merger NOLs and certain other tax attributes; competitive practices in the industry, including significant fare restructuring activities, capacity reductions and in court or out of court restructuring by major airlines; continued existence of prepetition liabilities; interruptions or disruptions in service at one or more of our hub airports; weather conditions; our ability to obtain and maintain any necessary financing for operations and other purposes; our ability to maintain adequate liquidity; our ability to maintain contracts that are critical to our operations; our ability to operate pursuant to the terms of our financing facilities (particularly the financial covenants); our ability to attract and retain customers; the cyclical nature of the airline industry; our ability to attract and retain qualified personnel; economic conditions; and other risks and uncertainties listed from time to time in our reports to the Securities and Exchange Commission. There may be other factors not identified above of which the Company is not currently aware that may affect matters discussed in the forward-looking statements, and may also cause actual results to differ materially from those discussed. All forward-looking statements are based on information currently available to the Company. The Company assumes no obligation to publicly update or revise any forward-looking statement to reflect actual results, changes in assumptions or changes in other factors affecting such estimates. Additional factors that may affect the future results of the Company are set forth in the section entitled “Risk Factors” in the Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2007, which is available at www.usairways.com.

Financial Tables to Follow

US Airways Group, Inc.
Condensed Consolidated Statements of Operations
(in millions except share and per share amounts)
(unaudited)

	3 Months Ended			3 Months Ended			Percent			9 Months Ended			9 Months Ended			Percent
	September 30, 2007			September 30, 2006			Change			September 30, 2007			September 30, 2006			Change
Operating revenues
Mainline passenger	$	2,133		$	2,052			4.0		$	6,233		$	6,048			3.1
Express passenger		692			703			(1.5	)		2,039			2,095			(2.7	)
Cargo		32			40			(19.7	)		102			114			(10.1	)
Other		179			173			2.9			550			514			6.8
Total operating revenues		3,036			2,968			2.3			8,924			8,771			1.7
Operating expenses
Aircraft fuel and related taxes		692			719			(3.8	)		1,900			1,943			(2.2	)
Loss (gain) on fuel hedging instruments, net:
Realized		(20	)		—		nm				17			(12	)	nm
Unrealized		(13	)		88		nm				(128	)		44		nm
Salaries and related costs		555			529			5.1			1,659			1,574			5.4
Express expenses:
Fuel		199			210			(5.2	)		539			585			(7.8	)
Other		450			443			1.4			1,382			1,345			2.8
Aircraft rent		182			181			0.7			542			546			(0.7	)
Aircraft maintenance		144			142			1.4			479			432			10.7
Other rent and landing fees		141			146			(4.0	)		408			432			(5.6	)
Selling expenses		116			120			(3.4	)		347			348			(0.3	)
Special items, net		17			27			(36.7	)		83			18		nm
Depreciation and amortization		47			42			11.9			137			132			3.9
Other		324			305			7.0			952			901			5.4
Total operating expenses		2,834			2,952			(4.0	)		8,317			8,288			0.3
Operating income		202			16		nm				607			483			25.8
Nonoperating income (expense)
Interest income		43			45			(2.8	)		131			111			18.4
Interest expense, net		(66	)		(74	)		(10.8	)		(206	)		(221	)		(7.0	)
Other, net		2			(4	)	nm				(11	)		(14	)		(15.9	)
Total nonoperating expense, net		(21	)		(33	)		(34.9	)		(86	)		(124	)		(30.6	)
Income (loss) before income taxes and cumulative effect of change in accounting principle		181			(17	)	nm				521			359			45.3
Income tax provision		4			61			(93.8	)		15			68			(78.2	)
Income (loss) before cumulative effect of change in accounting principle		177			(78	)	nm				506			291			74.1
Cumulative effect of change in accounting principle		—			—		nm				—			1		nm
Net income (loss)	$	177		$	(78	)	nm			$	506		$	292			74.1
Income (loss) per share before cumulative effect of change in accounting principle:
Basic	$	1.93		$	(0.88	)				$	5.54		$	3.41
Diluted	$	1.87		$	(0.88	)				$	5.33		$	3.20
Net income (loss) per share:
Basic	$	1.93		$	(0.88	)				$	5.54		$	3.42
Diluted	$	1.87		$	(0.88	)				$	5.33		$	3.21
Shares used for computation (in thousands):
Basic		91,542			88,212						91,461			85,286
Diluted		95,492			88,212						95,776			94,474

US Airways Group, Inc.
Operating Statistics

	3 Months Ended		3 Months Ended		Percent			9 Months Ended		9 Months Ended		Percent
	September 30, 2007		September 30, 2006		Change			September 30, 2007		September 30, 2006		Change
Mainline
Revenue passenger miles (in millions)		16,395		15,950		2.8			47,106		46,058		2.3
Available seat miles (ASM) (in millions)		19,669		20,156		(2.4	)		57,748		58,020		(0.5	)
Passenger load factor (percent)		83.4		79.1		4.3	pts		81.6		79.4		2.2	pts
Yield (cents)		13.01		12.86		1.2			13.23		13.13		0.8
Passenger revenue per ASM (cents)		10.85		10.18		6.5			10.79		10.42		3.6
Passenger enplanements (in thousands)		14,962		14,425		3.7			44,317		43,189		2.6
Aircraft (end of period)		359		357		0.6			359		357		0.6
Block Hours		340,146		352,316		(3.5	)		1,019,840		1,025,598		(0.6	)
Average stage length (miles)		945		956		(1.1	)		929		933		(0.5	)
Average passenger journey (miles)		1,558		1,576		(1.1	)		1,505		1,497		0.5
Fuel consumption (gallons in millions)		311.3		318.5		(2.3	)		909.8		912.5		(0.3	)
Average fuel price (dollars per gallon) with related taxes		2.22		2.26		(1.6	)		2.09		2.13		(1.9	)
Average fuel price including related taxes and realized loss (gain) on fuel hedging instruments, net (dollars)		2.16		2.26		(4.6	)		2.11		2.12		(0.5	)
Full-time equivalent employees (end of period)		34,321		33,252		3.2			34,321		33,252		3.2
Operating cost per ASM (cents)		11.11		11.40		(2.6	)		11.07		10.96		1.1
Operating cost per ASM excluding special items (cents)		11.09		10.83		2.4			11.17		10.85		2.9
Operating cost per ASM excluding special items, fuel and realized gain (loss) on fuel hedging instruments, net (cents)		7.68		7.26		5.7			7.85		7.52		4.3
Express*
Revenue passenger miles (in millions)		2,704		2,722		(0.7	)		7,827		8,058		(2.9	)
Available seat miles (in millions)		3,587		3,785		(5.2	)		10,592		11,204		(5.5	)
Passenger load factor (percent)		75.4		71.9		3.5	pts		73.9		71.9		2.0	pts
Passenger revenue per ASM (cents)		19.31		18.57		4.0			19.25		18.70		3.0
Passenger enplanements (in thousands)		6,662		6,556		1.6			19,474		19,527		(0.3	)
Fuel consumption (gallons in millions)		86.3		91.6		(5.8	)		256.6		267.2		(4.0	)
Average fuel price (dollars per gallon) with related taxes		2.30		2.29		0.5			2.10		2.19		(4.0	)
Operating cost per ASM (cents)		18.09		17.27		4.8			18.14		17.22		5.3
TOTAL — Mainline & Express
Revenue passenger miles (in millions)		19,099		18,672		2.3			54,933		54,116		1.5
Available seat miles (in millions)		23,256		23,941		(2.9	)		68,340		69,224		(1.3	)
Passenger load factor (percent)		82.1		78.0		4.1	pts		80.4		78.2		2.2	pts
Passenger revenue per ASM (cents)		12.15		11.51		5.6			12.10		11.76		2.9
Total revenue per ASM (cents)		13.06		12.40		5.3			13.06		12.67		3.1
Passenger enplanements (in thousands)		21,624		20,981		3.1			63,791		62,716		1.7
Operating cost per ASM (cents)		12.19		12.33		(1.2	)		12.17		11.97		1.6

* Express includes US Airways Group’s wholly owned regional airline subsidiaries, Piedmont Airlines and PSA Airlines, US Airways’ MidAtlantic regional jet division, through May 27, 2006, as well as operating and financial results from capacity purchase agreements with Mesa Airlines, Chautauqua Airlines, Air Wisconsin Airlines and Republic Airlines.

Reconciliation of GAAP Financial Information to Non-GAAP Financial Information and Operating Cost per ASM Excluding Special Items, Aircraft Fuel, Realized Gain (Loss) on Fuel Hedging Instruments, Net — Mainline only

US Airways Group, Inc. (the “Company”) is providing disclosure of the reconciliation of reported non-GAAP financial measures to their comparable financial measures on a GAAP basis. The Company believes that the non-GAAP financial measures provide investors the ability to measure financial performance excluding special items which is more indicative of the Company’s ongoing performance and is more comparable to measures reported by other major airlines. The Company believes that the presentation of mainline CASM excluding fuel and gain or loss on fuel hedging instruments is useful to investors as both the cost and availability of fuel are subject to many economic and political factors beyond the Company’s control.

	3 Months Ended			3 Months Ended			9 Months Ended			9 Months Ended
	September 30, 2007			September 30, 2006			September 30, 2007			September 30, 2006
	(in millions, except share and per share amounts)
Reconciliation of Income (loss) before Cumulative Effect of Change in Accounting Principle Excluding Special Items for US Airways Group, Inc.
Income (loss) before cumulative effect of change in accounting principle as reported	$	177		$	(78	)	$	506		$	291
Special items:
Unrealized gain (loss) on fuel hedging instruments, net (1)		(13	)		88			(128	)		44
Non-cash tax provision from utilization of pre-acquisition NOL (2)		4			59			10			59
Special items, net (3)		17			27			83			18
Other operating special items (4)		—			—			(9	)		—
Nonoperating special items (5)		—			5			18			9
Income before cumulative effect of change in accounting principle, as adjusted for special items	$	185		$	101		$	480		$	421
Shares used for computation (in thousands):
Basic		91,542			88,212			91,461			85,286
Diluted		95,492			95,307			95,776			94,474
Income per share before cumulative effect of change in accounting principle, as adjusted for special items:
Basic	$	2.02		$	1.15		$	5.25		$	4.93
Diluted (6)	$	1.96		$	1.09		$	5.06		$	4.57

	3 Months Ended			3 Months Ended			9 Months Ended			9 Months Ended
	September 30, 2007			September 30, 2006			September 30, 2007			September 30, 2006
Reconciliation of Operating Cost per ASM Excluding Special Items, Fuel, Realized Gain (Loss) on Fuel Hedging Instruments, Net — Mainline only
US Airways Group, Inc.
(in millions)
Total operating expenses	$	2,834		$	2,952		$	8,317		$	8,288
Less Express expenses:
Fuel		(199	)		(210	)		(539	)		(585	)
Other		(450	)		(443	)		(1,382	)		(1,345	)
Total mainline operating expenses		2,185			2,299			6,396			6,358
Special items:
Unrealized gain (loss) on fuel hedging instruments, net (1)		13			(88	)		128			(44	)
Special items, net (3)		(17	)		(27	)		(83	)		(18	)
Other operating special items (4)		—			—			9			—
Mainline operating expenses, excluding special items		2,181			2,184			6,450			6,296
Aircraft fuel		(692	)		(719	)		(1,900	)		(1,943	)
Realized gain (loss) on fuel hedging instruments, net		20			—			(17	)		12
Mainline operating expenses, excluding special items, fuel and realized gain (loss) on fuel hedging instruments, net	$	1,509		$	1,465		$	4,533		$	4,365
(in cents)
Mainline operating expenses per ASM		11.11			11.40			11.07			10.96
Special items per ASM
Unrealized gain (loss) on fuel hedging instruments, net (1)		0.07			(0.44	)		0.22			(0.08	)
Special items, net (3)		(0.09	)		(0.13	)		(0.14	)		(0.03	)
Other operating special items (4)		—			—			0.02			—
Mainline operating expenses per ASM, excluding special items		11.09			10.83			11.17			10.85
Aircraft fuel		(3.52	)		(3.57	)		(3.29	)		(3.35	)
Realized gain (loss) on fuel hedging instruments, net		0.10			—			(0.03	)		0.02
Mainline operating expenses per ASM, excluding special items, fuel and realized gain (loss) on fuel hedging instruments, net		7.68			7.26			7.85			7.52

Note: Amounts may not recalculate due to rounding.

Reconciliation of Operating Cost per ASM Excluding Special Items, Fuel, Realized Gain (Loss) on Fuel Hedging Instruments, Net — Mainline only

	FOOTNOTES:
1)	The 2007 third quarter and the 2007 nine month periods include $13 million and $128 million of unrealized gain, respectively. The 2006 third quarter and the 2006 nine month periods include $88 million and $44 million of unrealized loss, resulting from mark-to-market accounting for changes in the fair value of the Company’s fuel hedging instruments.
2)	For the three months and nine months ended September 30, 2007, the Company utilized $4 million and $10 million, respectively, of NOL acquired from US Airways. The valuation allowance associated with the acquired NOL was recognized as a reduction of goodwill rather than a reduction in tax expense. As a result, US Airways had a non-cash expense for income taxes of $4 million and $10 million, respectively, in the three and nine months ended September 30, 2007. For the three months and nine months ended September 30, 2006, the Company utilized $59 million of NOL acquired from US Airways. Similar to 2007, this resulted in a reduction of goodwill rather than a reduction in tax expense. As a result, US Airways had a non-cash expense for income taxes of $59 million in the three and nine months ended September 30, 2006.
3)	The 2007 third quarter and nine month periods include $17 million and $83 million, respectively, of merger related transition expenses. The 2006 third quarter includes $27 million of merger related transition expenses. The 2006 nine month period includes a $90 million gain associated with the return of equipment deposits upon forgiveness of a loan, offset by $108 million of merger related transition expenses.
4)	The 2007 nine month period includes $9 million of insurance settlement proceeds related to business interruption and property damages incurred as a result of Hurricane Katrina.
5)	The 2007 nine month period includes a $18 million write-off of debt issuance costs in connection with the refinancing of the $1.25 billion GE debt. The 2006 third quarter includes $5 million payment in connection with the inducement to convert $21 million of the 7% Senior Convertible Notes to common stock. The 2006 nine month period includes $6 million of prepayment penalties and a $5 million write-off of debt issuance costs in connection with the refinancing of the loan previously guaranteed by the ATSB and two loans previously provided to AWA by GECC, a $5 million payment in connection with the inducement to convert $21 million of the 7% Senior Convertible Notes to common stock less $7 million of interest income earned by AWA on certain prior year federal income tax refunds.
6)	The 2007 EPS computation excludes interest associated with the 7.0% senior convertible notes of $1 million and $4 million for the three and nine month periods, respectively. The 2006 EPS computation excludes interest associated with the 7.0% senior convertible notes of $2 million and $7 million for the three and nine months ended September 30, 2006, respectively and the 7.5% convertible senior notes of $4 million for the nine months ended September 30, 2006.

US Airways Group, Inc.
Condensed Consolidated Balance Sheets
(in millions)
(unaudited)

	September 30, 2007			December 31, 2006
Assets
Current assets
Cash, cash equivalents and short-term investments		2,680			2,365
Restricted cash		2			1
Accounts receivable, net		494			388
Materials and supplies, net		256			223
Prepaid expenses and other		516			377
Total current assets		3,948			3,354
Property and equipment
Flight equipment		2,298			2,051
Ground property and equipment		672			598
Less accumulated depreciation and amortization		(714	)		(583	)
		2,256			2,066
Equipment purchase deposits		78			48
Total property and equipment		2,334			2,114
Other assets
Goodwill		619			629
Other intangibles, net		535			554
Restricted cash		449			666
Other assets		219			259
Total other assets		1,822			2,108
Total assets	$	8,104		$	7,576
Liabilities and Stockholders’ Equity
Current liabilities
Current maturities of debt and capital leases		109			95
Accounts payable		391			454
Air traffic liability		944			847
Accrued compensation and vacation		214			262
Accrued taxes		132			181
Other accrued expenses		937			873
Total current liabilities		2,727			2,712
Noncurrent liabilities and deferred credits
Long-term debt and capital leases, net of current maturities		2,980			2,907
Deferred gains and credits		177			205
Employment benefit liabilities and other		754			782
Total noncurrent liabilities and deferred credits		3,911			3,894
Stockholders’ equity
Common stock		1			1
Additional paid-in capital		1,529			1,501
Accumulated deficit		(16	)		(522	)
Treasury stock		(13	)		(13	)
Accumulated other comprehensive income (loss)		(35	)		3
Total stockholders’ equity		1,466			970
Total liabilities and stockholders’ equity	$	8,104		$	7,576