Fuel costs drive airline profits down

July 22, 2008 at 3:01 PM
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TEMPE, Ariz., July 22 (UPI) -- US Airways Group, Inc. said its second quarter losses were reflective of the rising cost of jet fuel, a problem plaguing the airline industry.

The owners of US Airways and America West Airlines reported a net loss of $567 million in the second quarter, compared with a profit of $263 million a year ago, the Pittsburgh Tribune-Review reported.

The results "reflect the unprecedented rise in fuel process," Chief Executive Officer Doug Parker said.

On the positive side, revenue grew 3.2 percent in the quarter to nearly $3.26 billion and Parker said the company's cash level, at $2.8 billion, was "strong," the newspaper reported.

Looking forward, Parker said the airline was expecting a $400 million boost from new fees, sales of drinks and operating cost reductions in 2008, the report said.

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