Northwest Airlines ( NWAC) posted a second-quarter loss that wasn't as bad as Wall Street expected, while America West Airlines ( AWA) announced that second-quarter profit fell more than 50% from the year-ago quarter. Northwest reported a net loss of $182 million, or $2.11 a share, which is down from the net profit of $227 million, or $2.45 a share, it had a year ago. But excluding all items and charges, such as a $209 million reimbursement for security fees a year ago, the carrier lost $78 million, or 90 cents a share, which beats the loss of $1.21 expected by analysts and the year-ago loss of $160 million, or $1.86 a share. In reaction, shares of Northwest fell 3 cents, or 0.3%, to $8.91. Revenue came in at $2.87 billion, up 18.5% from the year-ago quarter, even though the carrier was more cautious than its peers when it came to resuming flights that were shelved a year ago because of the war in Iraq and SARS. The carrier said that revenue per available seat mile, a key metric called RASM, rose 12.7%. The company increased capacity, as measured in available seat miles, by 6.4% year over year, while traffic, as measured in revenue passenger miles, rose 14.8%. With demand outpacing supply, Northwest filled 82.5% of its seats, up from 76.4% a year ago. Operating expenses came in at $2.92 billion, however, up 17.1% year over year, driven by a 33.1% jump in the price of fuel. Cost per available seat mile, or CASM, came in at 10.16 cents, up 4.2% from last year and 66 cents higher than rival AMR ( AMR), parent of American Airlines. Like Delta Air Lines ( DAL), Northwest is in negotiations to win concessions from unions, adding that it has already worked through a ninth round of cost-cutting in non-labor expenses. "We have been meeting regularly with our pilots represented by the Air Line Pilots Association," said Doug Steenland, president of the company. "We have exchanged proposals on numerous issues and anticipate continuing our discussions."
America West announced its fifth straight quarter with a profit, with second-quarter net income of $5.7 million, or 11 cents a share, which missed the 16-cent Wall Street estimate and was lower than the net profit of $79.7 million, or $2.02 a share, it had a year ago. Shares of the company fell 30 cents, or 4.2%, to $6.82. Last year's results were inflated by an $81.3 million government reimbursement for security fees and other items. But even if all charges are excluded, the low-fare carrier's second-quarter earnings are about half the earnings of $12.9 million, or 33 cents a share, it had a year ago. Revenue came in at $605.1 million, slightly below the $620 million expected by analysts, but up 5.1% from the year-ago quarter. Expenses came in at $584.2 million, up 4.4% from last year. That said, America West continued to make progress cutting costs, with CASM coming in at 7.72 cents, down 1% from last year, despite a 41.4% rise in the price of fuel. "Our unit cost performance during the quarter improved significantly due to the increased utilization flying and longer average stage length, combined with increased productivity," said Derek Kerr, CFO of the company. Elsewhere, SkyWest ( SKYW) announced second-quarter net income of $20.1 million, or 34 cents a share, matching the Wall Street estimate and up from $14.9 million, or 26 cents a share, in the year-ago quarter. Revenue came in at $267.4 million, beating the $257.8 million expected by analysts and rising more than 25% from the year-ago $212.7 million. In reaction, shares of SkyWest fell 52 cents, or 3.4%, to $14.84.