US Airways announced that Merrill Lynch will purchase 19 million shares of US common stock in an underwritten public offering at $8.50 per share. Net proceeds after the underwriting discount and estimated offering expenses will be approximately $155 million to be used for "general corporate purposes," US said. ML will have a 30-day option to purchase an additional 2.85 million shares to cover overallotments. The offer is expected to close Aug. 19. Trading in US shares was halted yesterday.
Rolls-Royce and Goodrich yesterday signed a letter of intent to form a 50/50 joint venture to develop and supply engine controls for Rolls aero engines. JV will encourage synergies, combining Goodrich's UK-based engine controls design and manufacturing business and Rolls' controls integration expertise. Goodrich will retain the JV's aftermarket products and services. The initiative "reflects the importance we attach to the engine control system in optimizing engine performance," Rolls Director-Engineering & Technology Colin Smith said.
Copa Airlines and Aero Republica parent Copa Holdings reported second-quarter net income of $30.4 million, down 1.5% from $30.9 million in the year-ago period, as its aggressive expansion continued to pay off even in the face of high fuel costs. Copa said the "strong results" were reflective of fast-growing revenue that allowed it to maintain "its position among the world's most profitable airlines" even as fuel costs rose by $37 million year-over-year. Operating revenue soared 26.6% to $297.9 million and operating income was $31.2 million, down 20% from $39 million last year.
JAL Group commenced User Preferred Route trials for flights between Japan and Hawaii, enabling the airline to save fuel and cut CO2 emissions. JAL currently uses two flight paths on the route but now will capitalize on work begun last November by US FAA and Japan's Ministry of Land, Infrastructure, Transport and Tourism on UPR usage. It will conduct trials on scheduled flights serving Tokyo Narita-Honolulu, NRT-Kona, Osaka-HNL and Nagoya-HNL. The group operates approximately 4,700 combined one-way flights per year on the routes.
UK NATS reported that the number of flights through UK airspace in July dipped 0.6% from the year-ago month, the first decrease since 9/11. All NATS centers showed negative or static results. The London Area Control Centre handled 0.1% fewer flights and its Manchester counterpart 5.9% fewer. Transatlantic departures and arrivals decreased 3.3% and transatlantic overflights grew 2.3%.
Ryanair, which said last month that it expected an annual result of between breakeven and a €60 million loss for the year ending March 31, 2009, now expects to do no worse than breakeven. CEO Michael O'Leary told the BBC yesterday that the LCC "will be one of the very few airlines in Europe to grow strongly this winter and at least to break even, if not to make a small profit." Ryanair lost €90.5 million ($134.8 million) in its fiscal first quarter ended June 30.
SITA will upgrade Cathay Pacific Airways' network infrastructure to ensure readiness for new applications under a four-year, multimillion-dollar deal announced yesterday. Upgrade will offer 425% more bandwidth and feature messaging, IP services, managed firewall and end-to-end service management with a 24/7 help desk and on-site team. Agreement also includes SITA's Airport Hub solution featuring shared IT systems at more than 100 airports.
Swiss International Air Lines and its Edelweiss Air subsidiary reached an agreement allowing LX customers to book seats on Edelweiss flights to 15 destinations from Oct. 26. Established in 1995, Edelweiss operates as an independent entity within the Swiss group with three A320s and one A330-200.
Spring Airlines is expecting 2008 earnings to fall short of the CNY70 million ($10.2 million) profit reported last year owing to the difficult operating environment. Speaking to China Business News, Spring Chairman Wang Zhenghua said the LCC posted "a little" profit in the first half. He said fuel costs have jumped to 50% of Spring's total expenses, up from 30%-40%. "In addition, labor costs are rising," he said.
Continental Airlines will launch daily Newark-Shanghai on March 25 aboard a 777-200. It opened the flights for sale yesterday. Aer Lingus will abandon its Dublin-Copenhagen on Nov. 1.
ANA Aviation Services will provide marketing, sales, reservation and customer services for Biman Bangladesh Airlines in the UK, Ireland and Spain under a recently announced GSA agreement. BG operates five-times-weekly Dhaka-Dubai-London Heathrow.
EasyJet said it intends to file a complaint with Dutch competition authority NMa against airport operator Schiphol Amsterdam for charging passengers departing from the Netherlands higher fees than transfer passengers. "Schiphol is discriminating by charging passengers that depart from the Netherlands twice as much as transfer passengers," the LCC said. It alleges that AMS is violating Dutch and European law as the charges are discriminatory, unrelated to costs and not transparent. It will file a complaint with the European Commission if NMa refuses to investigate.
Austrian Airlines Group majority shareholder OIAG launched the tender for its 42.75% stake in the flag carrier, informing potential bidders that they have until Aug. 24 to declare their interest, according to press reports ( ATWOnline, Aug. 13).
Sabre Airline Solutions signed multimillion-dollar contracts with Vietnam Airlines to provide its SabreSonic reservations system and collaborate with IBM to boost online shopping capabilities.
Porter Airlines, which launched Q400 service in October 2006 from Toronto City Centre Airport, is eyeing additional destinations in the US, the first of which likely will be announced in the fall. "Boston and Chicago [Midway] are on the top of the list but Washington [National] and Philadelphia are close behind," Porter President and CEO Robert Deluce told ATWOnline. "All of them are on our radar screen for the short term." The US destinations need to be within 500 nm. of Toronto and have enough O&D traffic to support the service, he added.
Brussels Airport traffic returned to normal yesterday after negotiators sealed a deal to end a strike by baggage handlers Flightcare and Aviapartner over pay and working conditions. The work stoppage, which started Sunday night, forced airlines to cancel, delay or divert flights in and out of BRU. Some 120,000 passengers were affected by the strike, the airport said, and the baggage backlog is estimated at 20,000 pieces.
Finnair is the first European oneworld member to operate aircraft with alliance livery, following Japan Airlines and LAN Argentina. One A340 and one A319 feature the oneworld script along the front of the fuselage with the tails of the group's member carriers toward the rear.
As an increasing number of US lawmakers raised questions over the proposed DHL-UPS deal, the House of Representatives announced two hearings on the matter and Ohio's full Congressional delegation wrote a letter to German President Angela Merkel asking her to push DHL to "reconsider."
Thai Airways posted a THB9.25 billion ($272.3 million) loss in the second quarter, widened from a THB430 million deficit in the year-ago period, on fuel costs and foreign exchange losses, according to a company statement cited by Reuters.
American Airlines flew 12.46 billion system RPMs in July, a 3.5% decrease from the year-ago month. Capacity fell 1.2% to 14.52 billion ASMs and load factor declined 2 points to 85.8%. Northwest Airlines flew 7.56 billion consolidated RPMs in July, up 3.9% year-over-year. Capacity increased 5.2% to 8.73 billion ASMs and load factor fell 1.1 points to 86.6%. British Airways flew 9.98 billion RPKs in July, down 3.5% from the year-ago month, against a 3.5% increase in ASKs to 13.17 billion. Load factor dropped 5.4 points to 75.8%.
American Airlines said yesterday that it will speed up deliveries of its 737-800s, taking an additional six in 2010 as it as it seeks to replace its MD-80s with more fuel efficient aircraft. The carrier now plans to take delivery of 36 -800s in 2009 and 40 in 2010. It has firm orders for an additional 11 737NGs to be delivered in 2013 and "continues to evaluate opportunities to accelerate MD-80 replacement with additional 737s," it said in a statement.
StandardAero inked MRO contracts with Aerolineas Mesoamericanas covering CF34-3B1s and 36-150 APUs on CRJ200s with various support elements including spare engines and technical and program management. Contracts are eight-year programs (four plus four one-year options) valued at more than $50 million. Separately, StandardAero broke ground on a 24,384-sq.-m. expansion of its Winnipeg facility to accommodate engine throughputs. Manitoba government will contribute C$20 million to the project.
Pinnacle Airlines Corp. reported a second-quarter net loss of $11.4 million, a reversal from the $7.6 million profit reported in the year-ago quarter, on a 10% lift in operating revenue to $221.2 million.
Austrian government's Council of Ministers yesterday issued the contract for the privatization of Austrian Airlines Group to state holding company OIAG, entitling it to sell the entirety of its 42.75% stake ( ATWOnline, Aug. 11). The contract stipulates that Austrian interests must hold 25% plus one share. Merrill Lynch has been appointed as exclusive financial adviser in the potential sale of OIAG shares to a strategic partner ( ATWOnline, Aug. 1).
