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US airlines on road to recovery
The long-troubled North American airline industry appears to be heading towards profitability again, according to second quarter profit reports from American Airlines and Southwest Airlines.
American posted second-quarter profits of US$291 million or US$1.14 per share, five times higher than last year’s $58 million and 30 cents a share.
Chief executive Gerard Arpey said: “Our performance indicates very clearly that we are on the right track, but also demonstrates, just as clearly, that we have more work to do.”
Meanwhile Southwest Airlines reported a doubling of second quarter earnings, with net profits rising to US$333 million from US$144 million the year before.
“We generated higher recent yields to offset significantly higher jet fuel prices,” said chief executive Gary Kelly.
Southwest said its third-quarter bookings are strong and that the increase in operating costs, including fuel, should be less than the 4.9% rise in the second quarter.
Kelly said the company should easily exceed its goal of increasing earnings by 15% in 2006.
Report by David Wilkening
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Bev
Editor in chief Bev Fearis has been a travel journalist for 25 years. She started her career at Travel Weekly, where she became deputy news editor, before joining Business Traveller as deputy editor and launching the magazine’s website. She has also written travel features, news and expert comment for the Guardian, Observer, Times, Telegraph, Boundless and other consumer titles and was named one of the top 50 UK travel journalists by the Press Gazette.
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