NEW YORK -- USAir Group Inc. announced another quarter of dismal results yesterday, losing $84.9 million in the latest three-month period and showing no sign of a turnaround.
"Industrywide fare reductions that began early in the second quarter sharply eroded the positive momentum that we had developed in the first quarter of this year," said USAir Chief Executive Officer Seth Schofield.
The results posted by the company, which receives almost all its revenues from its principal subsidiary, USAir, compared with a loss of $56.8 million in the second quarter of 1991. Because of some improvement registered earlier in the year, results for the first half of the year were not quite as bad as those for the first half of 1991. Net losses declining from $243.9 million to $173.8 million.
Mr. Schofield said he was hopeful that a fare increase of 4.4 percent and compensation concessions from pilots could reverse USAir's current trend.
The grim tidings were no surprise to Wall Street. USAir's share price closed at $13.75, unchanged.
"The industry is terrible, and these guys are part of a terrible industry," said Helane Becker, an analyst at Shearson Lehman Brothers. "It's called a profitless prosperity: Planes are packed, passengers feel they are like sardines, but no one is making any money."
USAir had little choice but to match fare cuts started by others, analysts said. Its condition, however, was particularly precarious because of a heavy debt load and the failure to maintain passenger good will in critical markets purchased at great cost in acquisitions of PSA and Piedmont Aviation Inc. during the past decade.
Several of the nation's largest carriers, including Continental Airlines, America West Airlines and Trans World Airlines, are operating under bankruptcy, and several others, including Braniff, Pan Am and Midway Airlines, have ceased operating. Any immediate concern over the solvency of USAir, however, evaporated earlier this week when it announced the sale of a 44 percent stake to British Airways for $750 million, an amount just under what USAir has lost in the past two calendar years.
Ms. Becker reckoned that most of the discount tickets sold in recent promotions have yet to be used and that, as a result, several tough periods remain.
But looking on a brighter side, she and other analysts said that the sharp discounting in prices must soon end and that better conditions would emerge.
USAir Group Inc.
'Three months ended 06/30/92
.....Revenue.... .... .... Net.... .... .... Share
'92..1,699,890,000 ... ...(84,884,000) ...(2.08)
'91..1,664,843,000 ... ...(56,792,000) ...($1.47)
% change +2.1 ... .... ....--... ... ... ....--
Six months ended 06/30/92
.... Revenue.... .... .... Net.... .... .... Share
... ...(147,915,000)... (3.71)
'91..3,246,522,000 ... ...(225,484,000)... (5.35)
% change +3.2 ... ... ... ...-- ... ... ... ...--