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Continued: Delta, US Airways report 2Q profits as cheaper fuel provides a tail wind

  • Article by: DAVID KOENIG , AP Airlines Writer
  • Last update: July 24, 2013 - 6:30 PM

US Airways, the nation's fifth-biggest airline, predicted that passengers would pay 2 to 4 percent more per mile in July, August and September compared with last year.

Airlines have reduced flights and eliminated unprofitable routes, leaving fewer empty seats. Delta and US Airways both averaged 85 percent occupancy on flights in the second quarter. That has allowed them to cut costs while carrying roughly the same number of passengers as before.

"Demand is strong, load factors (average seats filled) are strong, margins are up," said Hunter Keay, an analyst with Wolfe Trahan. "That's how airlines are running their businesses now."

US Airways, which expects to close a merger with American Airlines in the next few weeks, reported net income of $287 million, or $1.40 per share, down from $306 million, or $1.54 per share, in last year's second quarter. The company blamed an $85 million income tax provision that was triggered as it used up an allowance for operating losses carried over from previous years.

Excluding merger and debt-retirement costs, US Airways said that it would have earned $1.58 per share. That topped the $1.52 per share that analysts expected, according to FactSet. Revenue rose 3 percent to $3.87 billion, beating forecasts.

Delta's $685 million profit equaled 80 cents per share and reversed a $168 million loss a year earlier, when the company was weighed down by accounting losses tied to fuel-price-hedging bets.

Delta said that excluding special items, it would have earned 98 cents per share, which beat analysts' forecast of 95 cents per share. Revenue was about flat at $9.71 billion, a bit less than analysts expected.

United Continental Holdings Inc. and Southwest Airlines Co. are scheduled to report quarterly results before the market opens on Thursday.

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