America West (NYSE:AWA)
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America West Reports Second Quarter Results
Airline Posts Quarterly Profit
PHOENIX, July 21 /PRNewswire-FirstCall/ -- America West Holdings Corporation
(NYSE:AWA), parent company of America West Airlines, Inc., today reported
second quarter 2005 net income of $13.9 million or $0.29 per diluted share.
This compares to a net profit of $10.7 million or $0.20 per diluted share for
the same period last year. The Company's second quarter 2005 profit included a
$2.7 million unrealized loss associated with the Company's fuel hedging
transactions and a $4.3 million loss on the sale and leaseback of an aircraft
acquired during the period. The second quarter 2004 results included an
unrealized gain on fuel hedging transactions of $7.2 million. Excluding these
special items, the airline's second quarter 2005 net income was $20.9 million
or $0.41 per diluted share versus net income of $3.5 million or $0.07 per
diluted share in the second quarter 2004. 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.
(Logo: http://www.newscom.com/cgi-bin/prnh/20050223/LAW097LOGO)
Chairman and CEO Doug Parker stated, "We are pleased to report an improvement
in year-over-year earnings despite a 43 percent increase in average fuel price.
Our 14,000 employees did a terrific job of taking care of a record number of
passengers and these results reflect their efforts. We are particularly
pleased with our nearly 12 percent increase in passenger revenue per available
seat mile, which we believe will be the greatest improvement by any major
carrier.
"Our proposed merger with US Airways is well on track with $565 million of
committed equity, Department of Justice approval and teams from both companies
working diligently on integration. We continue to anticipate closing this
important transaction in the fall."
Revenue and Cost Performance
The airline's operating revenues increased 20.0 percent to $833.0 million
during its second quarter 2005 compared to the same period last year. Revenue
passenger miles (RPMs) during the second quarter increased 8.0 percent to a
record 6.4 billion on increased available seat miles (ASMs) of 2.7 percent.
This resulted in a second quarter 2005 load factor of 82.3 percent versus the
second quarter 2004 load factor of 78.3 percent. The increase in load factor,
along with a 6.5 percent increase in the airline's yield during its second
quarter 2005, contributed to an 11.9 percent increase in RASM during the second
quarter 2005 as compared to the same period last year.
The airline's operating cost per available seat mile (CASM) increased 12.2
percent to 8.58 cents during its second quarter 2005, led primarily by a 43.6
percent increase in total fuel expenses. CASM excluding fuel, fuel hedging and
special items increased 2.7 percent to 6.17 cents. On average, the airline paid
$1.67 per gallon for fuel during the second quarter 2005, an increase of 43.0
percent over the per gallon price paid in the same period last year. The
airline hedged approximately 58 percent of its fuel during its second quarter
2005, realizing gains on fuel hedging instruments of $11.4 million that reduced
total fuel expense. Including these gains, the average net fuel price was $1.57
per gallon.
Chief Financial Officer Derek Kerr said, "While we are pleased with our revenue
performance these improvements are not enough to offset the ongoing high price
of fuel. Fuel expense for the quarter was the Company's greatest expense item,
exceeding even salaries and benefits for only the second time in Company
history, and we do not see any signs of this trend altering itself in the
foreseeable future."
Liquidity
As of June 30, 2005, the Company had $413.9 million in cash and investments, of
which $322.3 million was unrestricted.
Additional Marketing/Business Developments
* Announced increased service between the U.S. and Jordan through its
code-share agreement with partner Royal Jordanian Airlines.
* Continued to grow Las Vegas by introducing service to six new markets:
Bakersfield, Pittsburgh, Long Beach, Anchorage, Oklahoma City, and
Monterey, Calif.
* Celebrated a "Three-Peat" when FlightFund, the airline's loyalty
program, earned the Freddie Award's "Best Elite Program" recognition
for the third straight year.
* Introduced a unique brand of in-flight entertainment with
Cranium, Inc., which offers passengers fun and innovative games on
video-equipped aircraft.
* Partnered with Vegas.com to offer tickets to Las Vegas' premier
shows and LookTours.com, which offers activity packages for
passengers' vacations.
Analyst Conference Call/Webcast Details
America West will conduct a live audio webcast of its earnings call today at
1:00 p.m. EDT, which will be available to the public on a listen-only basis at
http://www.americawest.com/ < http://www.americawest.com/ > under the About
AWA/Investor Relations tab. A replay of today's call will be available in the
About AWA/Investor Relations portion of the airline's Web site through August
21, 2005.
America West Holdings Corporation is an aviation and travel services company.
Wholly owned subsidiary America West Airlines is the nation's second largest
low-fare carrier with 14,000 employees serving approximately 60,000 customers a
day in more than 90 destinations in the U.S., Canada, Mexico and Costa Rica.
(AWAF)
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," "anticipate,"
"believe," "estimate," "plan," "could," "should," and "continue" and similar
terms used in connection with statements regarding our outlook, expected fuel
costs, the revenue environment, our expected 2005 financial performance and the
proposed merger with US Airways Group, Inc. ("US Airways" and, together with
America West Holdings Corporation, the "companies"). Such statements include,
but are not limited to, statements about the benefits of the business
combination transaction involving the companies, including future financial and
operating results, the companies' plans, objectives, expectations and intentions
and other statements that are not historical facts. Such statements are based
upon the current beliefs and expectations of the companies' management and are
subject to significant risks and uncertainties that could cause the companies'
actual results and financial position to differ materially from these
statements. Such risks and uncertainties include, but are not limited to, the
following: the ability of the companies to obtain and maintain any necessary
financing for operations and other purposes, whether debtor-in-possession
financing, in the case of US Airways, or other financing; the ability of the
companies to maintain adequate liquidity; the duration and extent of the
current soft economic conditions; the impact of global instability caused by
military actions, terrorism, disease outbreaks and natural disasters;
limitations on the companies' flexibility in responding to industry conditions
due to high fixed costs and restrictions imposed by debt instruments; changes
in prevailing interest rates; the ability to attract and retain qualified
personnel; the ability of the companies to attract and retain customers; the
cyclical nature of the airline industry; competitive practices in the industry,
including significant fare restructuring activities by major airlines; the
impact of historically high fuel prices; economic conditions; reliance on
automated systems and the impact of any failure of those systems; labor costs;
security-related and insurance costs; weather conditions; government
legislation and regulation; relations with unionized employees generally and
the impact and outcome of the labor negotiations; US Airways ability to
continue as a going concern; US Airways' ability to obtain court approval with
respect to motions in the Chapter 11 proceedings prosecuted by it from time to
time; the ability of US Airways 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 US Airways to propose and
confirm one or more plans of reorganization, to appoint a Chapter 11 trustee or
to convert the cases to Chapter 7 cases; the ability of US Airways to obtain and
maintain normal terms with vendors and service providers; US Airways' ability to
maintain contracts that are critical to its operations; the potential adverse
impact of the Chapter 11 proceedings on US Airways' liquidity or results of
operations; the ability of US Airways to operate pursuant to the terms of its
financing facilities (particularly the financial covenants); the ability of US
Airways to fund and execute its Transformation Plan during the Chapter 11
proceedings and in the context of a plan of reorganization and thereafter; and
other risks and uncertainties listed from time to time in the companies'
reports to the SEC. There may be other factors not identified above of which
the companies are 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 companies assume no obligation to
publicly update any forward-looking statement 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 of US Airways ultimately confirmed, can
affect the value of the US Airways' various prepetition liabilities, common
stock and/or other equity securities. Accordingly, the companies urge that the
appropriate caution be exercised with respect to existing and future investments
in any of these liabilities and/or securities. Additional factors that may
affect the future results of America West Holding Company and US Airways are
set forth in their respective filings with the SEC, which are available at
http://www.shareholder.com/americawest/edgar.cfm and
http://investor.usairways.com/edgar.cfm, respectively.
ADDITIONAL INFORMATION AND WHERE TO FIND IT
In connection with the proposed transaction, US Airways has filed a
registration statement, including a proxy statement of America West, and other
materials with the Securities and Exchange Commission (the "SEC"). WE URGE
INVESTORS TO READ THE REGISTRATION STATEMENT AND PROXY STATEMENT AND THESE
OTHER MATERIALS CAREFULLY BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT
THE PROPOSED TRANSACTION. Investors may obtain free copies of the registration
statement and proxy statement, as well as other filed documents containing
information about US Airways and America West at http://www.sec.gov/, the SEC's
website. Free copies of America West's SEC filings are also available on
America West's website at http://www.shareholder.com/americawest/edgar.cfm, or
by request to Investor Relations, America West Holdings Corporation, 111 West
Rio Salado Pkwy, Tempe, Arizona 85281. Free copies of US Airways' SEC filings
are also available on US Airways' website at
http://investor.usairways.com/edgar.cfm or by request to Investor Relations, US
Airways Group, Inc., 2345 Crystal Drive, Arlington, VA 22224.
This communication shall not constitute an offer to sell or the solicitation of
an offer to buy any securities, nor shall there by any sale of securities in any
jurisdiction in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such
jurisdiction. No offering of securities shall be made except by means of a
prospectus meeting the requirements of Section 10 of the Securities Act of
1933, as amended.
PARTICIPANTS IN THE SOLICITATION
America West, US Airways and their respective executive officers and directors
may be deemed, under SEC rules, to be participants in the solicitation of
proxies from America West's stockholders with respect to the proposed
transaction. Information regarding the officers and directors of America West
is included in its definitive proxy statement for its 2005 Annual Meeting filed
with the SEC on April 15, 2005. Information regarding the officers and
directors of US Airways is included in its 2004 Annual Report filed with the
SEC on Form 10-K on March 1, 2005. More detailed information regarding the
identity of potential participants, and their interests in the solicitation, is
set forth in the registration statement and proxy statement and other materials
filed with the SEC in connection with the proposed transaction.
America West Holdings Corporation
Condensed Consolidated Statements of Operations
(in thousands except per share amounts)
(unaudited)
3 Months Ended 3 Months Ended Percent
June 30, 2005 June 30, 2004 Change
Operating revenues:
Passenger $654,893 $569,166 15.1
Express 129,426 85,466 51.4
Cargo 8,126 6,817 19.2
Other 40,752 32,709 24.6
Total operating revenues 833,197 694,158 20.0
Operating expenses:
Salaries and related costs 173,752 161,977 7.3
Aircraft rental 80,673 75,346 7.1
Rentals and landing fees 45,727 42,011 8.8
Aircraft fuel 191,006 132,977 43.6
Loss (gain) on fuel
hedging instruments, net:
Realized (11,344) (2,297) --
Unrealized 2,671 (7,188) --
Agency commissions 6,710 6,253 7.3
Aircraft maintenance
materials and repairs 49,359 52,350 (5.7)
Depreciation and amortization 11,587 12,587 (7.9)
Special charges, net -- -- --
Express expenses
Fuel 44,304 23,644 87.4
Other 91,744 66,158 38.7
Other 116,731 104,525 11.7
Total operating expenses 802,920 668,343 20.1
Operating income 30,277 25,815 17.3
Nonoperating income (expenses):
Interest income 2,476 1,779 39.2
Interest expense, net (19,736) (19,237) 2.6
Gain on disposition of
property and equipment 334 1,437 (76.8)
Other, net 557 867 (35.8)
Total nonoperating
expenses, net (16,369) (15,154) 8.0
Income before income
tax expense 13,908 10,661 30.5
Income tax expense -- -- --
Net income $13,908 $10,661 30.5
Earnings per share:
Basic $0.39 $0.30 28.7
Diluted $0.29 $0.20 46.1
Shares used for computation:
Basic 36,032 36,005 0.1
Diluted 53,553 52,020 2.9
America West Holdings Corporation
Condensed Consolidated Statements of Operations
(in thousands except per share amounts)
(unaudited)
6 Months Ended 6 Months Ended Percent
June 30, 2005 June 30, 2004 Change
Operating revenues:
Passenger $1,230,306 $1,106,499 11.2
Express 232,782 158,117 47.2
Cargo 16,770 13,720 22.2
Other 76,151 65,149 16.9
Total operating revenues 1,556,009 1,343,485 15.8
Operating expenses:
Salaries and related costs 348,900 328,252 6.3
Aircraft rental 157,510 150,531 4.6
Rentals and landing fees 87,266 83,252 4.8
Aircraft fuel 342,869 247,189 38.7
Loss (gain) on fuel
hedging instruments, net:
Realized (22,879) (5,197) --
Unrealized (46,277) (4,692) --
Agency commissions 12,264 13,003 (5.7)
Aircraft maintenance
materials and repairs 97,347 102,404 (4.9)
Depreciation and amortization 23,447 26,378 (11.1)
Special charges, net 811 (600) --
Express expenses
Fuel 76,662 41,097 86.5
Other 170,212 122,007 39.5
Other 227,521 198,957 14.4
Total operating expenses 1,475,653 1,302,581 13.3
Operating income 80,356 40,904 96.5
Nonoperating income (expenses):
Interest income 4,375 3,297 32.7
Interest expense, net (38,715) (38,989) (0.7)
Gain on disposition of
property and equipment 428 2,079 (79.4)
Other, net 1,041 1,807 (42.4)
Total nonoperating
expenses, net (32,871) (31,806) 3.3
Income before income
tax expense 47,485 9,098 --
Income tax expense -- -- --
Net income $47,485 $9,098 --
Earnings per share:
Basic $1.32 $0.25 --
Diluted $0.92 $0.17 --
Shares used for computation:
Basic 36,015 35,928 0.2
Diluted 62,551 52,070 20.1
America West Airlines, Inc.
Consolidated Statements of Operations
(in thousands)
(unaudited)
3 Months Ended 3 Months Ended Percent
June 30, 2005 June 30, 2004 Change
Operating revenues:
Passenger $654,893 $569,166 15.1
Express 129,426 85,466 51.4
Cargo 8,126 6,817 19.2
Other 40,582 32,539 24.7
Total operating revenues 833,027 693,988 20.0
Operating expenses:
Salaries and related costs 173,399 161,617 7.3
Aircraft rental 80,673 75,346 7.1
Rentals and landing fees 45,727 42,011 8.8
Aircraft fuel 191,006 132,977 43.6
Loss (gain) on fuel
hedging instruments, net:
Realized (11,344) (2,297) --
Unrealized 2,671 (7,188) --
Agency commissions 6,710 6,253 7.3
Aircraft maintenance
materials and repairs 49,359 52,350 (5.7)
Depreciation and amortization 11,587 12,587 (7.9)
Special charges, net -- -- --
Express expenses
Fuel 44,304 23,644 87.4
Other 91,744 66,158 38.7
Other 115,469 103,779 11.3
Total operating expenses 801,305 667,237 20.1
Operating income 31,722 26,751 18.6
Nonoperating income (expenses):
Interest income 4,021 3,418 17.6
Interest expense, net (21,448) (20,948) 2.4
Gain on disposition
of property and equipment 334 1,437 (76.8)
Other, net 557 867 (35.8)
Total nonoperating
expenses, net (16,536) (15,226) 8.6
Income before income
tax expense 15,186 11,525 31.8
Income tax expense -- -- --
Net income $15,186 $11,525 31.8
America West Airlines, Inc.
Consolidated Statements of Operations
(in thousands)
(unaudited)
6 Months Ended 6 Months Ended Percent
June 30, 2005 June 30, 2004 Change
Operating revenues:
Passenger $1,230,306 $1,106,499 11.2
Express 232,782 158,117 47.2
Cargo 16,770 13,720 22.2
Other 75,811 64,809 17.0
Total operating revenues 1,555,669 1,343,145 15.8
Operating expenses:
Salaries and related costs 348,252 327,546 6.3
Aircraft rental 157,510 150,531 4.6
Rentals and landing fees 87,266 83,252 4.8
Aircraft fuel 342,869 247,189 38.7
Loss (gain) on fuel
hedging instruments, net:
Realized (22,879) (5,197) --
Unrealized (46,277) (4,692) --
Agency commissions 12,264 13,003 (5.7)
Aircraft maintenance
materials and repairs 97,347 102,404 (4.9)
Depreciation and amortization 23,447 26,378 (11.1)
Special charges, net 811 (600) --
Express expenses
Fuel 76,662 41,097 86.5
Other 170,212 122,007 39.5
Other 225,518 197,591 14.1
Total operating expenses 1,473,002 1,300,509 13.3
Operating income 82,667 42,636 93.9
Nonoperating income (expenses):
Interest income 7,485 6,619 13.1
Interest expense, net (42,118) (42,410) (0.7)
Gain on disposition of
property and equipment 428 2,079 (79.4)
Other, net 1,041 1,807 (42.4)
Total nonoperating
expenses, net (33,164) (31,905) 3.9
Income before income
tax expense 49,503 10,731 --
Income tax expense -- -- --
Net income $49,503 $10,731 --
America West Airlines, Inc.
Mainline Operating Statistics
(Excluding Express Operations)
3 Months 3 Months 6 Months 6 Months
Ended Ended Ended Ended
June 30, June 30, Percent June 30, June 30, Percent
2005 2004 Change 2005 2004 Change
Revenue
passenger
miles
(in
millions) 6,386 5,915 8.0 12,057 11,222 7.4
Available
seat miles
(ASM) (in
millions) 7,755 7,552 2.7 15,057 14,904 1.0
Passenger
load
factor
(percent) 82.3 78.3 4.0 pts 80.1 75.3 4.8 pts
Yield per
revenue
passenger
mile
(cents) 10.25 9.62 6.5 10.20 9.86 3.4
Passenger
revenue
per ASM
(cents) 8.44 7.54 11.9 8.17 7.42 10.1
Total
revenue per
available
seat mile
(cents) 9.07 8.06 12.5 8.79 7.95 10.6
Passenger
enplanements
(in
thousands) 5,752 5,343 7.7 10,924 10,241 6.7
Aircraft
(end of
period) 143 140 2.1 143 140 2.1
Average
daily
aircraft
utilization
(hours) 11.1 11.0 0.9 11.1 10.9 1.8
Block
hours 143,365 139,202 3.0 279,862 275,880 1.4
Average
stage
length
(miles) 1,037 1,058 (2.0) 1,030 1,047 (1.6)
Average
passenger
journey
(miles) 1,681 1,692 (0.7) 1,653 1,644 0.5
Fuel
consumption
(gallons
in
millions) 114.5 113.9 0.5 221.7 222.4 (0.3)
Average
fuel
price
(cents
per
gallon) 166.9 116.7 43.0 154.7 111.2 39.1
Average
fuel
price
including
realized
gains on
fuel
hedging
instruments,
net (cents) 157.0 114.7 36.9 144.4 108.8 32.7
Average
number
of
full-time
equivalent
employees 12,200 11,936 2.2 12,177 11,881 2.5
Operating
cost per
ASM (cents) 8.58 7.65 12.2 8.14 7.63 6.7
Operating
cost per
ASM
excluding
special
items
(cents) 8.49 7.74 9.7 8.39 7.67 9.4
Operating
cost per
ASM
excluding
special
items,
fuel and
realized
gains on
fuel
hedging
instruments,
net (cents) 6.17 6.01 2.7 6.27 6.04 3.8
The Company is using the term mainline to reflect operating statistics
and financial measures associated with aircraft operated by America West.
Reconciliation of GAAP Financial Information to Non-GAAP Financial
Information
The Company believes that the presentation of certain non-GAAP financial
measures such as net income (loss) and CASM excluding special items is
useful to investors because it is more indicative of the Company's true
recurring operating performance and more comparable to financial measures
reported by other major airlines that are submitted to the Department of
Transportation. The Company believes that the presentation of CASM
excluding fuel and gains and losses on fuel hedging instruments is useful
to investors because it provides the ability to monitor the airline's
cost performance absent fuel price volatility, which is subject to many
economic and political factors and therefore beyond the Company's
control.
Reconciliation of Net Income Excluding Special Items
3 Months 3 Months 6 Months 6 Months
Ended Ended Ended Ended
June 30, June 30, June 30, June 30,
2005 2004 2005 2004
(in millions except per share amounts)
Net income used
to calculate
basic earnings
per share:
Net income
as reported $13.9 $10.7 $47.5 $9.1
Special items:
Special charges (1) -- -- 0.8 --
Revision of
estimated
special
charges (2) -- -- -- (0.6)
Loss on
aircraft
sale
leaseback
transaction (3) 4.3 -- 8.0 --
Unrealized
(gain) loss
on fuel
hedging
instruments,
net (4) 2.7 (7.2) (46.3) (4.7)
Net income,
as adjusted
for special
items $20.9 $3.5 $10.0 $3.8
Basic earnings
per share $0.39 $0.30 $1.32 $0.25
Special items:
Special charges -- -- 0.02 --
Revision of
estimated
special
charges -- -- -- (0.01)
Loss on
aircraft
sale
leaseback
transaction 0.12 -- 0.22 --
Unrealized
(gain) loss
on fuel
hedging
instruments,
net 0.07 (0.20) (1.28) (0.13)
Basic earnings
per share, as
adjusted for
special items $0.58 $0.10 $0.28 $0.11
Basic shares
(in thousands) 36,032 36,005 36,015 35,928
Net income used
to calculate
diluted earnings
per share:
Net income
as reported $13.9 $10.7 $47.5 $9.1
Interest expense
on 7.5%
convertible
senior notes (5) 3.1 -- -- --
Interest
expense
on 7.25%
senior
exchangeable
notes (5) 1.7 -- -- --
Special items:
Special charges (1) -- -- 0.8 --
Revision of
estimated
special
charges (2) -- -- -- (0.6)
Loss on
aircraft
sale
leaseback
transaction (3) 4.3 -- 8.0 --
Unrealized (gain)
loss on fuel
hedging
instruments,
net (4) 2.7 (7.2) (46.3) (4.7)
Net income, as
adjusted for
interest expense
and special items $25.7 $3.5 $10.0 $3.8
Diluted earnings
per share $0.22 $0.21 $1.05 $0.17
Interest expense
on 7.5%
convertible
senior notes (5) 0.05 -- -- --
Interest expense
on 7.25%
senior
exchangeable
notes (5) 0.03 -- -- --
Special items:
Special charges -- -- 0.02 --
Revision of
estimated
special charges -- -- -- (0.01)
Loss on aircraft
sale leaseback
transaction 0.07 -- 0.18 --
Unrealized (gain)
loss on fuel
hedging
instruments, net 0.04 (0.14) (1.03) (0.09)
Diluted earnings
per share, as
adjusted for
interest expense
and special items $0.41 $0.07 $0.22 $0.07
Diluted shares
(in thousands):
Weighted average
common shares
outstanding 36,032 36,005 36,015 35,928
Assumed exercise
of stock
options and
warrants 9,425 16,015 9,082 16,142
Assumed conversion
of 7.5%
convertible senior
notes (5) 9,358 -- -- --
Assumed conversion
of 7.25%
senior exchangeable
notes (5) 8,096 -- -- --
Diluted shares,
as adjusted
(in thousands) 62,911 52,020 45,097 52,070
Notes:
(1) The 2005 six-month period includes $0.8 million of special charges
related to the final Boeing 737-200 aircraft which was removed from
service in January 2005.
(2) The 2004 six-month period includes a credit of $0.6 million related
to the revision of the estimated costs associated with the sale and
leaseback of certain aircraft.
(3) The second quarter of 2005 includes a $4.3 million loss on the sale
and leaseback of one new Airbus A320 aircraft acquired during the
period. The 2005 six-month period includes a total of $8.0 million
loss on the sale and leaseback of two new Airbus A320 aircraft
acquired during the period.
(4) The 2005 second quarter and the 2005 six-month period includes a
$2.7 million unrealized loss and $46.3 million unrealized gain,
respectively, and the 2004 second quarter and the 2004 six-month
period includes a $7.2 million and $4.7 million unrealized gain,
respectively, resulting from mark-to-market accounting for changes
in the fair value of the Company's fuel hedging instruments.
(5) This reflects the use of the "if converted" method to incorporate
convertible notes into the diluted earnings per share computation.
Under this method, the convertible notes are assumed to have been
converted at the beginning of the accounting period, or at their
date of issuance, if later. Therefore, the interest expense, net of
tax, that would not have been paid if the notes had been converted
is recognized as an adjustment to net income. Concurrently, the
number of shares are adjusted to assume conversion of the notes to
shares.
Reconciliation of Airline Operating Cost per ASM Excluding Special Items,
Fuel and Realized Gains on Fuel Hedging Instruments, Net - Mainline only
3 Months 3 Months 6 Months 6 Months
Ended Ended Ended Ended
June 30, June 30, June 30, June 30,
2005 2004 2005 2004
(in thousands)
Total operating expenses $801,305 $667,237 $1,473,002 $1,300,509
Less: Express expenses (136,048) (89,802) (246,874) (163,104)
Total mainline operating
expenses 665,257 577,435 1,226,128 1,137,405
Special items:
Special charges -- -- (811) --
Revision of estimated
special charges -- -- -- 600
Loss on aircraft sale
leaseback transaction (4,278) -- (8,013) --
Unrealized gain (loss) on
fuel hedging instruments,
net (2,671) 7,188 46,277 4,692
Operating expenses, excluding
special items 658,308 584,623 1,263,581 1,142,697
Fuel expense (191,006) (132,977) (342,869) (247,189)
Realized gains on fuel
hedging instruments, net 11,344 2,297 22,879 5,197
(179,662) (130,680) (319,990) (241,992)
Operating expenses, excluding
special items, fuel and
realized gains on fuel
hedging instruments, net $478,646 $453,943 $943,591 $900,705
3 Months 3 Months 6 Months 6 Months
Ended Ended Ended Ended
June 30, June 30, June 30, June 30,
2005 2004 2005 2004
(in cents)
Operating cost per ASM $8.58 $7.65 $8.14 $7.63
Special items:
Special charges -- -- (0.01) --
Revision of estimated special
charges -- -- -- 0.01
Loss on aircraft sale
leaseback transaction (0.06) -- (0.05) --
Unrealized gain (loss)
on fuel hedging
instruments, net (0.03) 0.09 0.31 0.03
Operating cost per ASM,
excluding special items 8.49 7.74 8.39 7.67
Fuel expense (2.47) (1.76) (2.27) (1.66)
Realized gains on fuel hedging
instruments, net 0.15 0.03 0.15 0.03
(2.32) (1.73) (2.12) (1.63)
Operating expenses,
excluding special items,
fuel and realized gains
on fuel hedging instruments,
net $6.17 $6.01 $6.27 $6.04
America West Holdings Corporation
Condensed Consolidated Balance Sheets
(in thousands of dollars)
(unaudited)
June 30, December 31,
2005 2004
Assets
Current assets
Cash equivalents and short-term
investments $322,278 $275,742
Restricted cash -- 41,264
Other current assets, net 371,728 307,971
Total current assets 694,006 624,977
Property and equipment, net 684,203 656,535
Other assets
Investments in debt securities -- 30,000
Restricted cash 91,633 72,091
Other assets 134,975 91,661
Total assets $1,604,817 $1,475,264
Liabilities and Stockholders' Equity
Current liabilities
Current maturities of long-term
debt $119,276 $154,658
Other liabilities 653,278 510,058
Total current liabilities 772,554 664,716
Long-term debt, less current
maturities 593,184 640,190
Deferred credits and other
noncurrent liabilities 154,941 133,911
Stockholders' equity 84,138 36,447
Total liabilities and
stockholders' equity $1,604,817 $1,475,264
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DATASOURCE: America West Holdings Corporation
CONTACT: Elise Eberwein of America West Holdings Corporation,
+1-480-693-5729
Web site: http://www.americawest.com/