USAir has another bad quarter $56.8 million loss blamed on recession


July 27, 1991|By Michael Pollick

Will the red ink ever stop flowing for USAir Group Inc., the parent company of Baltimore-Washington International Airport's dominant carrier?

The company Thursday reported a net loss of $56.8 million on revenue of $1.7 billion in the second quarter.

That brought the losses for the first half of the year to $225.5 pTC million. USAir has had two consecutive years of losses -- $63.2 million in 1989 and $454.5 million last year.

At least one airline analyst, Thomas Longman of the New York investment firm of Bear Stearns Cos., is guessing that the company will get into the black in the second quarter of next year.

"On a full-year basis, it's harder to say," he added. "I forecast a loss for '92 and profitability in '93, but it's conceivable they could get into the black for full year '92 as well."

Mr. Longman expects a net loss of $29 million next year. Even though "we're looking at pretty substantial losses, I do think they will be a survivor," the analyst added.

As part of an overall retrenchment in May, USAir dropped 47 of its 251 daily flights at BWI. It was a serious loss for the region's air travelers, because USAir is nine times larger than the next-largest carrier serving BWI, American Airlines.

The company said in its earnings statement that second-quarter results were affected by the recession, which has slowed down air traffic in the eastern part of the country where the company's operations are concentrated.

"Although our yield, or revenue per passenger mile flown, was 2.5 percent higher during the second quarter compared with the same period of last year, it was not sufficient to offset our decline in traffic," said Seth E. Schofield, president and chief executive officer.

He said the company expects to begin "realizing the full benefits of our May 2 restructuring program by the fourth quarter of 1991."

Meanwhile, he said, the company is looking for new ways to generate revenues and cut costs.

Mr. Longman said that the company "needs a strong economic recovery."

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