US AIRWAYS GROUP, INC. REPORTS FOURTH QUARTER RESULTS
$236 Million Net Loss for the Quarter; $611 Million Net Loss for Full Year
2004
Mainline Cost per Available Seat Mile, Excluding Fuel, Down 14 percent to
8.79 cents
ARLINGTON, Va., Jan. 31, 2005 -- US Airways Group, Inc. today reported
a net loss of $236 million for the fourth quarter 2004, compared to a $98
million net loss for the fourth quarter 2003. The fourth quarter 2004 pre-
tax loss of $238 million compares to a pre-tax loss of $99 million for the
same quarter in 2003. Excluding unusual items, the pre-tax loss for the
fourth quarter 2004 was $214 million compared to $129 million in 2003 (see
Note 5 for reconciliation).
The sustained high price of fuel continues to have a negative impact
on cash flow when coupled with pressure on unit revenue. The cost of
aviation fuel per gallon, including taxes, for the fourth quarter 2004 was
130.84 cents (124.32 cents excluding taxes), up 49.1 percent from the same
period in 2003. Fuel hedging benefits, which partially mitigated the
dramatic increase in fuel price, improved results by $47 million, or 21.9
cents per gallon.
"We have overcome what many claimed to be insurmountable obstacles,
and our dedicated employees deserve the credit for working with us," said
US Airways President and Chief Executive Officer Bruce R. Lakefield.
"Although the industry still faces a number of challenges, we are actively
managing those issues and working to build an airline that can be
successful in an operating environment of lower revenue and sustained high
fuel costs."
System passenger revenue per available seat mile (PRASM) for the
fourth quarter 2004 was 9.65 cents, down 10.9 percent compared to the
fourth quarter of 2003, reflecting the continuing downward pressure on
fares across the industry. Domestically, system PRASM fell 12.7 percent to
10.32 cents. System statistics encompass mainline, MidAtlantic Airways,
wholly owned airline subsidiaries of US Airways Group, Inc. and capacity
purchases from third parties operating regional jets as US Airways Express.
For US Airways mainline operations only, the PRASM of 8.71 cents was down
10.8 percent. Fourth quarter 2003 passenger transportation revenues
included a $34.2 million favorable adjustment related to the air traffic
liability.
System available seat miles (ASMs) were up 4.1 percent, while mainline
ASMs increased 0.8 percent during the fourth quarter 2004. System revenue
passenger miles (RPMs) increased 5.1 percent, while mainline RPMs increased
1.5 percent. The fourth quarter system load factor of 71.9 percent was up
0.7 percentage points year-over-year. The mainline passenger load factor
for the fourth quarter was up 0.5 percentage points to 73.2 percent. For
the fourth quarter 2004, US Airways Group Inc.'s system carried 14.1
million passengers, an increase of 4.4 percent, while mainline operations
carried 10.1 million passengers, a 2.3 percent decrease compared to the
same period of 2003. The fourth quarter 2004 yield for mainline operations
of 11.90 cents decreased 11.4 percent from the same period in 2003, while
system yield was down 11.8 percent to 13.42 cents. As noted above, fourth
quarter 2003 passenger transportation revenues included a $34.2 million
favorable adjustment related to the air traffic liability.
Excluding the fourth quarter 2003 favorable adjustment, system PRASM
declined 9.0 percent, system domestic PRASM declined 10.9 percent, and
mainline PRASM declined 8.4 percent. Yield decline, excluding the
adjustment, was 9.8 percent for the system and 8.9 percent for mainline.
Executive Vice President of Marketing and Planning Bruce Ashby said
that while US Airways fully expects continued expansion by low-cost, low-
fare airlines, especially in the East, the company is better positioned
today than ever before to compete aggressively. "We have made enormous
progress in reducing costs, leveraging our core strengths and building
schedules that meet the needs of the communities we serve, and now we are
improving operational reliability and enhancing technology and online
capabilities. As we meet various milestones and build momentum for our
restructuring, we have been pleased with the strong response to the
marketing initiatives of the past few weeks and the enthusiasm demonstrated
by our customers, corporate accounts and travel partners."
The mainline cost per available seat mile (CASM), excluding fuel and
unusual items, of 8.79 cents for the fourth quarter 2004 was a 14 percent
decrease over the same period in 2003 (for a reconciliation of unit costs,
see Note 3 to the Selected Airline Operating and Financial Statistics).
Substantially all of the company's unrestricted cash (includes cash,
cash equivalents and short-term investments) constitutes cash collateral
under the Air Transportation Stabilization Board (ATSB) loan agreement. As
of Dec. 31, 2004, $738 million of cash collateral was available for the
company's use, subject to the limitations of the cash collateral agreement
with the ATSB and approved by the Bankruptcy Court, including stringent
minimum cash balances. The cash collateral agreement has been extended
through June 30, 2005. Additionally, on Dec. 31, 2004, restricted cash was
$626 million, for a total cash position of $1.36 billion. This compares to
a total cash position of $1.84 billion on Dec. 31, 2003, which included
$1.29 billion of unrestricted cash.
Other notable developments:
* Ratified cost-savings agreements with all of its labor groups, including
non-unionized employees, totaling $1.1 billion in annualized value.
* Received ATSB extension to use cash proceeds from a federally guaranteed
loan through June 30, 2005, enabling the airline to continue operations
while it completes its restructuring and planned emergence from Chapter
11 this summer.
* Reached a comprehensive aircraft leasing and financing, and engine
services agreement with GE Capital Aviation Services (GECAS) and GE
Engine Services, to provide short-term liquidity, reduce debt, lower
aircraft ownership costs, and enhance engine maintenance services and
leases for new regional jets, while preserving the vast majority of
US Airways' mainline fleet owned by GECAS.
* Expect to take delivery of 12 new regional jets by the end of February.
These are the first regional jets delivered to the company since
US Airways filed for bankruptcy in September 2004. US Airways wholly
owned subsidiary PSA and MidAtlantic division today operate 62 of the
50-seat, 70-seat and 72-seat regional jets.
* Announced scheduling changes at Philadelphia International Airport to
improve operational reliability by reducing the number of flights
during peak hours, keeping fewer aircraft on the ground, and spreading
departure and arrival schedules to reduce congestion. US Airways also
will add 49 flights in February, for a total of 496 daily nonstop
departures.
* Announced six new routes (Atlanta, Cleveland, Dallas-Fort Worth,
Detroit, Houston Bush Intercontinental and Chicago O'Hare) from Reagan
Washington National Airport in February.
US Airways Group, Inc. and its domestic subsidiaries filed voluntary
petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code
on Sept. 12, 2004, providing the company the opportunity to implement its
Transformation Plan built on lower costs, a simplified fare structure, and
expanded service.
US Airways will not hold a fourth quarter results conference call.
Members of the media needing additional information should contact
US Airways Corporate Affairs at 703-872-5100. Analysts should contact
US Airways Investor Relations at 703-872-7923.
Certain of the statements contained herein should be considered "forward-
looking statements" within the meaning of the Private Securities Litigation
Reform Act of 1995, which reflect the current views of US Airways Group
(the "company") with respect to current events and financial performance.
You can identify these statements by forward-looking words such as "may,"
"will," "expect," "intend," "anticipate," "believe," "estimate," "plan,"
"could," "should," and "continue" or similar words. These forward-looking
statements may also use different phrases. Such forward-looking statements
are and will be, as the case may be, subject to many risks, uncertainties
and factors relating to the company's operations and business environment
which may cause the actual results of the company to be materially
different from any future results, express or implied, by such forward-
looking statements. Factors that could cause actual results to differ
materially from these forward-looking statements include, but are not
limited to, the following: the ability of the company to continue as a
going concern; the ability of the company to obtain and maintain any
necessary financing for operations and other purposes, whether debtor-in-
possession financing or other financing; the ability of the company to
maintain adequate liquidity; the ability of the company to absorb
escalating fuel costs; the company's ability to obtain court approval with
respect to motions in the Chapter 11 proceeding prosecuted by it from time
to time; the ability of the company to develop, prosecute, confirm and
consummate one or more plans of reorganization with respect to the Chapter
11 proceedings; risks associated with third parties seeking and obtaining
court approval to terminate or shorten the exclusivity period for the
company to propose and confirm one or more plans of reorganization, for the
appointment of a Chapter 11 trustee or to convert the cases to Chapter 7
cases; the ability of the company to obtain and maintain normal terms with
vendors and service providers; the company's ability to maintain contracts
that are critical to its operations; the potential adverse impact of the
Chapter 11 proceedings on the company's liquidity or results of operations;
the ability of the company to operate pursuant to the terms of its
financing facilities (particularly the financial covenants); the ability of
the company to fund and execute its Transformation Plan during the Chapter
11 proceedings and in the context of a plan of reorganization and
thereafter; the ability of the company to attract, motivate and/or retain
key executives and associates; the ability of the company to attract and
retain customers; the ability of the company to maintain satisfactory labor
relations; demand for transportation in the markets in which the company
operates; economic conditions; labor costs; financing availability and
costs; security-related and insurance costs; competitive pressures on
pricing (particularly from lower-cost competitors) and on demand
(particularly from low-cost carriers and multi-carrier alliances); weather
conditions; government legislation and regulation; impact of the Iraqi war
and the Iraqi occupation; other acts of war or terrorism; and other risks
and uncertainties listed from time to time in the company's reports to the
SEC. 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. The company assumes no obligation to update such
estimates to reflect actual results, changes in assumptions or changes in
other factors affecting such estimates other than as required by law.
Similarly, these and other factors, including the terms of any
reorganization plan ultimately confirmed, can affect the value of the
company's various pre-petition liabilities, common stock and/or other
equity securities. Accordingly, the company urges that the appropriate
caution be exercised with respect to existing and future investments in any
of these liabilities and/or securities.
US Airways Group, Inc. NEWS RELEASE
(Debtor-in-Possession)
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
(dollars in millions, except per share amounts)
Successor Company (1)
---------------------------------------------
Three Months Ended Twelve Months Ended
------------------------- -------------------
December 31, December 31, December 31,
2004 2003 (2) 2004
------------ ------------ -------------
Operating Revenues
Passenger transportation (3) $ 1,470 $ 1,585 $ 6,345
Cargo and freight 33 32 132
Other 157 147 640
------ ------ ------
Total Operating Revenues 1,660 1,764 7,117
Operating Expenses
Personnel costs 518 662 2,439
Aviation fuel 322 205 1,099
US Airways Express capacity
purchases 204 182 801
Aircraft rent 114 107 449
Other rent and landing fees 105 110 419
Selling expenses 84 112 394
Aircraft maintenance 90 100 361
Depreciation and amortization 62 57 248
Special items -- -- --
Government compensation -- -- --
Other 303 303 1,285
------ ------ ------
Total Operating Expenses 1,802 1,838 7,495
------ ------ ------
Operating Income (Loss) (142) (74) (378)
Other Income (Expense)
Interest income 1 5 12
Interest expense, net (73) (58) (242)
Reorganization items, net (24) -- (35)
Other, net -- 28 22
------ ------ ------
Other Income (Expense), Net (96) (25) (243)
------ ------ ------
Income (Loss) Before Income Taxes (238) (99) (621)
Provision (Credit) for Income
Taxes (2) (1) (10)
------ ------ ------
Net Income (Loss) $ (236) $ (98) $ (611)
====== ====== ======
Earnings (Loss) per Common Share (4)
Basic $ (4.30) $ (1.82) $(11.19)
Diluted $ (4.30) $ (1.82) $(11.19)
Shares Used for Computation (000)
Basic 54,862 53,968 54,597
Diluted 54,862 53,968 54,597
Successor Company (1) Predecessor Company (1)
---------------------- -----------------------
Nine Months Ended Three Months Ended
September 30, 2003 (2) March 31, 2003 (2)
--------------------- -----------------------
Operating Revenues
Passenger transportation (3) $ 4,775 $ 1,358
Cargo and freight 97 35
Other 440 141
------ ------
Total Operating Revenues 5,312 1,534
Operating Expenses
Personnel costs 2,040 622
Aviation fuel 617 213
US Airways Express capacity purchases 515 130
Aircraft rent 322 109
Other rent and landing fees 323 106
Selling expenses 316 91
Aircraft maintenance 314 88
Depreciation and amortization 172 70
Special items 34 --
Government compensation (214) --
Other 917 312
------ ------
Total Operating Expenses 5,356 1,741
------ ------
Operating Income (Loss) (44) (207)
Other Income (Expense)
Interest income 15 1
Interest expense, net (170) (73)
Reorganization items, net -- 1,917
Other, net 36 (3)
------ ------
Other Income (Expense), Net (119) 1,842
------ ------
Income (Loss) Before Income Taxes (163) 1,635
Provision (Credit) for Income
Taxes 11 --
------ ------
Net Income (Loss) $ (174) $ 1,635
====== ======
Earnings (Loss) per Common Share (4)
Basic $ (3.25) $ 24.02
Diluted $ (3.25) $ 24.02
Shares Used for Computation (000)
Basic 53,495 68,076
Diluted 53,495 68,076
(1) Successor Company refers to US Airways Group, Inc. (US Airways Group or
the Company) on and after March 31, 2003, after giving effect to the
cancellation of the then existing common stock and the issuance of new
securities in accordance with its plan of reorganization, and
application of fresh-start reporting. Predecessor Company refers to
US Airways Group prior to March 31, 2003. As a result of the
application of fresh-start reporting, the Successor Company's
financial statements are not comparable with the Predecessor Company's
financial statements.
(2) Certain prior year amounts have been reclassified to conform with the
2004 presentation.
(3) Includes revenues related to capacity purchase agreements with Mesa
Airlines, Chautauqua Airlines, Trans States Airlines and Midway
Airlines (through October 2003).
(4) Earnings (Loss) per Common Share amounts may not recalculate due to
rounding.
(5) Pursuant to SEC Regulation G, the table below shows a reconciliation of
Income (Loss) Before Income Taxes, Excluding Unusual Items, a non-GAAP
financial measure, to Net Income (Loss) reported on a GAAP basis. This
non-GAAP financial measure provides management the ability to measure
and monitor US Airways Group's financial performance excluding unusual
items which is more indicative of the Company's ongoing operating
performance and is more comparable to financial measures reported by
other major network airlines.
Successor Company
------------------------------------------
Three Months Ended Twelve Months Ended
----------------------- ----------------
December 31, December 31, December 31,
2004 2003 2004
------------ ------------ ------------
(dollars in millions)
Loss Before Income Taxes,
Excluding Unusual Items $ (214) $ (129) $ (586)
Unusual Items
Gain on sale of Hotwire (a) -- 30 --
Aircraft order
cancellation penalty (b) -- -- --
Government compensation (c) -- -- --
Reorganization items, net (d) (24) -- (35)
Other -- -- --
------ ----- -----
Total Unusual Items (24) 30 (35)
Income (Loss) Before Income Taxes $ (238) $ (99) $ (621)
===== ===== =====
Successor Company Predecessor Company
-------------------- ---------------------
Nine Months Ended Three Months Ended
December 31, 2003 March 31, 2003
-------------------- -----------------
(dollars in millions)
Loss Before Income Taxes,
Excluding Unusual Items $ (373) $ (282)
Unusual Items
Gain on sale of Hotwire (a) 30 --
Aircraft order cancellation penalty (b) (35) --
Government compensation (c) 214 --
Reorganization items, net (d) -- 1,917
Other 1 --
----- -----
Total Unusual Items 210 1,917
Income (Loss) Before Income Taxes $ (163) $ 1,635
===== =====
(a) During the fourth quarter of 2003, US Airways recorded a $30 million
gain as a result of the sale of its investment in Hotwire which is
included in Other,net.
(b) During the second quarter of 2003, US Airways, Inc. recorded a $35
million charge in connection with its intention to not take delivery
of certain aircraft scheduled for future delivery.
(c) During the second quarter of 2003, US Airways Group received proceeds
of $214 million (US Airways received $212 million), net of amounts due
to affiliates, from the Transportation Security Administration under
the 2003 Emergency Wartime Supplemental Appropriations Act as
reimbursement for certain security fees.
(d) During the first quarter of 2003, US Airways Group recognized $1.92
billion in Other Income (Expense) incurred as a direct result of its
2002 Chapter 11 filing. This income includes, among other things, a
$3.94 billion gain on discharge of liabilities, a $967 million gain on
restructured aircraft financings and a $387 million net gain on the
termination of certain pension plans partially offset by $1.11
billion of adjustments related to the revaluation of assets and
liabilities in connection with fresh start accounting, $2.17 billion
in damage and deficiency claims and $51 million in professional fees.
For the three months and twelve months ended December 31,2004, US
Airways Group recognized $24 million and $35 million, respectively, in
professional fees directly relating to its 2004 Chapter 11 filing.
US Airways, Inc. NEWS RELEASE
(Debtor-in-Possession)
(A Wholly Owned Subsidiary of US Airways Group, Inc.)
STATEMENTS OF OPERATIONS
(unaudited)
(in millions)
Successor Company (1)
----------------------------------------------
Three Months Ended
-------------------------- Twelve Months Ended
December 31, December 31, December 31,
2004 2003 (2) 2004
------------- ------------ -------------------
Operating Revenues
Passenger transportation (3) $ 1,470 $ 1,585 $ 6,345
Cargo and freight 33 32 132
Other 151 124 596
------ ------ ------
Total Operating Revenues 1,654 1,741 7,073
Operating Expenses
Personnel costs 456 598 2,188
Aviation fuel 294 190 1,012
US Airways Express capacity
purchases 324 305 1,304
Aircraft rent 107 99 414
Other rent and landing fees 100 102 398
Selling expenses 77 108 364
Aircraft maintenance 79 79 301
Depreciation and amortization 57 54 223
Special items -- -- --
Government compensation -- -- --
Other 288 279 1,217
------ ------ ------
Total Operating Expenses 1,782 1,814 7,421
------ ------ ------
Operating Income (Loss) (128) (73) (348)
Other Income (Expense)
Interest income 1 5 12
Interest expense, net (71) (56) (236)
Reorganization items, net (20) -- (32)
Other, net (2) 30 19
------ ------ ------
Other Income (Expense), Net (92) (21) (237)
------ ------ ------
Income (Loss) Before Income Taxes (220) (94) (585)
Provision (Credit) for Income Taxes(2) (5) (7)
------ ------ ------
Net Income (Loss) $ (218) $ (89) $ (578)
====== ====== ======
Successor Company (1) Predecessor Company
(1) ---------------------- -----------------
- -------
Nine Months Ended Three Months Ended
December 31, 2003 March 31, 2003 (2)
---------------------- -------------------
- -----
Operating Revenues
Passenger transportation (3) $ 4,775 $ 1,358
Cargo and freight 97 35
Other 378 119
------ ------
Total Operating Revenues 5,250 1,512
Operating Expenses
Personnel costs 1,848 562
Aviation fuel 574 197
US Airways Express capacity purchases 894 251
Aircraft rent 298 101
Other rent and landing fees 301 99
Selling expenses 293 83
Aircraft maintenance 250 70
Depreciation and amortization 161 66
Special items 34 --
Government compensation (212) --
Other 851 285
------ ------
Total Operating Expenses 5,292 1,714
------ ------
Operating Income (Loss) (42) (202)
Other Income (Expense)
Interest income 15 2
Interest expense, net (164) (73)
Reorganization items, net -- 1,888
Other, net 37 (2)
------ ------
Other Income (Expense), Net (112) 1,815
------ ------
Income (Loss) Before Income Taxes (154) 1,613
Provision (Credit) for Income Taxes 6 --
------ ------
Net Income (Loss) $ (160) $ 1,613
====== ======
(1) Successor Company refers to US Airways, Inc. on and after March 31,
2003, after giving effect to fresh-start reporting. Predecessor
Company refers to US Airways, Inc. prior to March 31, 2003. As a
result of the application of fresh-start reporting, the Successor
Company's financial statements are not comparable with the Predecessor
Company's financial statements.
(2) Certain prior year amounts have been reclassified to conform with the
2004 presentation.
(3) Includes revenues related to capacity purchase agreements with
Allegheny Airlines (through June 2004), Piedmont Airlines, PSA
Airlines, Mesa Airlines, Chautauqua Airlines, Trans States Airlines
and Midway Airlines (through October 2003).
US Airways, Inc. NEWS RELEASE
(Debtor-in-Possession)
(A Wholly-Owned Subsidiary of US Airways Group, Inc.)
SELECTED AIRLINE OPERATING AND FINANCIAL STATISTICS (1)
(unaudited)
Three Months Ended December 31,
--------------------------------
%
2004 2003 Change
------- ------- --------
Revenue passenger miles (millions)*
System 10,950 10,414 5.1
Mainline 9,511 9,374 1.5
Available seat miles (millions)*
System 15,233 14,629 4.1
Mainline 13,000 12,893 0.8
Total available seat miles (millions)
System 15,238 14,634 4.1
Mainline 13,005 12,897 0.8
Passenger load factor*
System 71.9% 71.2% 0.7
pts.
Mainline 73.2% 72.7% 0.5
pts.
Yield*
System 13.42c 15.22c (11.8)
Mainline (3) 11.90c 13.43c (11.4)
Passenger revenue per available
seat mile*
System 9.65c 10.83c (10.9)
Mainline (3) 8.71c 9.77c (10.8)
Revenue passengers (thousands)*
System 14,097 13,507 4.4
Mainline 10,147 10,384 (2.3)
Mainline revenue per available
seat mile* (3) 10.11c 10.96c (7.8)
Mainline cost per available seat
mile ("Mainline CASM")*(3) 10.96c 11.70c (6.3)
Mainline CASM excluding unusual
items* (3) 10.96c 11.70c (6.3)
Mainline CASM excluding aviation
fuel and unusual items* (3) 8.79c 10.22c (14.0)
Average stage length (miles)* 757 765 (1.0)
Cost of aviation fuel per gallon 130.84c 87.74c 49.1
Cost of aviation fuel per gallon
(excluding fuel taxes) 124.32c 82.54c 50.6
Gallons of aviation fuel consumed
(millions) 216 217 (0.5)
Scheduled mileage completion
factor* 99.1% 99.4%
(0.3)pts.
Number of aircraft in operating
fleet at period-end 281 282 (0.4)
Full-time equivalent employees at
period-end 24,628 26,797 (8.1)
Twelve Months Ended December 31,
---------------------------------
%
2004 2003(2) Change
------- ------- --------
Revenue passenger miles (millions)*
System 45,087 41,464 8.7
Mainline 39,964 37,741 5.9
Available seat miles (millions)*
System 61,353 58,017 5.8
Mainline 53,220 51,494 3.4
Total available seat miles (millions)
System 61,362 58,106 5.6
Mainline 53,229 51,584 3.2
Passenger load factor*
System 73.5% 71.5% 2.0
pts.
Mainline 75.1% 73.3% 1.8
pts.
Yield*
System 14.07c 14.79c (4.9)
Mainline (3) 12.43c 13.05c (4.8)
Passenger revenue per available
seat mile*
System 10.34c 10.57c (2.2)
Mainline (3) 9.33c 9.56c (2.4)
Revenue passengers (thousands)*
System 55,954 52,797 6.0
Mainline 41,510 41,251 0.6
Mainline revenue per available
seat mile* (3) 10.69c 10.75c (0.6)
Mainline cost per available seat
mile ("Mainline CASM")*(3) 11.34c 11.36c (0.2)
Mainline CASM excluding unusual
items* (3) 11.34c 11.70c (3.1)
Mainline CASM excluding aviation
fuel and unusual items* (3) 9.48c 10.21c (7.1)
Average stage length (miles)* 782 761 2.8
Cost of aviation fuel per gallon 112.08c 88.29c 26.9
Cost of aviation fuel per gallon
(excluding fuel taxes) 106.35c 83.02c 28.1
Gallons of aviation fuel consumed
(millions) 884 873 1.3
Scheduled mileage completion
factor* 99.0% 99.1%
(0.1)pts.
Number of aircraft in operating
fleet at period-end 281 282 (0.4)
Full-time equivalent employees at
period-end 24,628 26,797 (8.1)
* Scheduled service only (excludes charter service).
c - cents
(1) All statistics include US Airways' "Mainline" operations only unless
noted otherwise. System statistics encompass all wholly owned airline
subsidiaries of US Airways Group, including US Airways, Allegheny
Airlines (through June 2004), Piedmont Airlines and PSA Airlines as
well as operating and financial results from capacity purchase
agreements with Mesa Airlines, Chautauqua Airlines, Trans States
Airlines and Midway Airlines (through October 2003).
(2) Statistics for the twelve months ended December 31, 2003 include
amounts from both the Successor Company and the Predecessor Company.
(3) Pursuant to SEC Regulation G, US Airways, Inc. (the Company) is
providing disclosure of the reconciliation of reported non-GAAP
financial measures to their comparable financial measures reported on
a GAAP basis. The non-GAAP financial measures provide management the
ability to measure the Company's financial performance at the mainline
level both with and without unusual items and the cost of aviation
fuel as both the cost and availability of aviation fuel are subject to
many economic and political factors beyond the Company's control,
unusual items are not indicative of the Company's ongoing operating
performance and mainline measures are more comparable to financial
measures reported to the Department of Transportation by other major
network airlines.
---------------------- -----------------------
Three Months Ended Twelve Months Ended
December 31, December 31,
---------------------- -----------------------
2004 2003 2004 2003
------------ --------- ------------ ----------
(dollars in millions)
Passenger transportation revenue reconciliation:
GAAP passenger transportation
revenue $ 1,470 $ 1,585 $ 6,345 $ 6,133
Less: US Airways Express
and MidAtlantic
transportation revenue (338) (326) (1,379) (1,208)
-------- -------- ------ -------
Mainline passenger
transportation revenue $ 1,132 $ 1,259 $ 4,966 $ 4,925
Operating revenue reconciliation:
GAAP operating revenues $ 1,654 $ 1,741 $ 7,073 $ 6,762
Less: US Airways Express and
MidAtlantic operating
revenues (339) (327) (1,385) (1,214)
--------- -------- ------- --------
Mainline operating revenues $ 1,315 $ 1,414 $ 5,688 $ 5,548
Operating expenses reconciliation:
GAAP operating expenses $ 1,782 $ 1,814 $ 7,421 $ 7,006
Less: US Airways Express
capacity purchases (324) (305) (1,304) (1,145)
Less: MidAtlantic Airways
operating expenses (33) -- (79) --
--------- -------- ------- --------
Mainline operating expenses $ 1,425 1,509 $ 6,038 $ 5,861
Cost per available seat mile reconciliations: (1)
Cost per available seat mile excluding
US Airways Express capacity purchases
("Mainline CASM") 10.96 c 11.70 c 11.34 c 11.36 c
Unusual operating items:
Aircraft order
cancellation penalty -- -- -- (0.07)
Government compensation -- -- -- 0.41
------- ------ ------ ------
Mainline CASM excluding unusual
items 10.96 c 11.70 c 11.34 c 11.70 c
Aviation fuel - Mainline (2.17) (1.48) (1.86) (1.49)
------- ------ ------ ------
Mainline CASM excluding unusual
items and aviation fuel 8.79 c 10.22 c 9.48 c 10.21 c
c - cents
(1) Amounts may not recalculate due to rounding.