British Airways yesterday posted a 60.4% jump in net profits to #162 million ($275 million) for the quarter that ended Sept. 30 as operating profits soared 30.3% to #262 million ($445 million). The airline, with a large Europe-Asia flight offering, logged a 1.6-percentage-point-rise in operating margin to 9.2%. Net profits for the first half of BA's fiscal year rose 9.5% to #347 million ($590 million) from #317 million, excluding one-time events. Revenue for the three-month period increased 8.7% to #2.44 billion ($4.15 billion).
LanChile's traffic for September grew 9.9% on 13.4% more capacity, which forced the passenger load factor down 1.9 percentage points to 60.9%. For the first nine months, traffic increased 13% and capacity 15.6%.
Aer Lingus will extend its agreement to wet-lease an MD-11 from World Airways for the peak holiday season this year and from May through October next year. Aer Lingus has used the aircraft since May for New York-Shannon passenger service six times a week, with flights extending to Belfast.
United will stop operating its daily flight between Washington Dulles and San Salvador, El Salvador, on Jan. 16 due to low demand on the route. The airline began service in July. The service is the latest canceled by United and other airlines that had rushed to add capacity to the Latin American market in the spring and summer.
American will scale back next year's growth rate in fear of a slowing global economy and retire 16 aircraft, instead of the six it had planned. It will delay several international route launches, including newly won authority to fly from New York and Boston to Tokyo. The airline foreshadowed the actions when it released its third quarter earnings last month (DAILY, Oct. 22). At the time, Chief Financial Officer Gerard Arpey said the airline was considering a retrenchment from 6% capacity growth in 1999 to 4%.
Southwest, expected to expand into the New York area soon, could choose to surround the city with flights from three cities, according to several sources.The three airports sources say would get Southwest's flights are Islip to the east, Allentown/Bethlehem to the west and Newburgh/Stewart Field to the north. "These would be Southwest's string of pearls around New York," comments George Hamlin, VP with Global Aviation Associates.
McDonnell Douglas DC-10 Systemwide Aircraft Utilization Per Day Second Quarter 1998 DC-10-10 American United Total Number of Aircraft Operated 13 22 35 Total Fleet Operations Departures 27 62 90
China Airlines' board of directors has appointed Sandy Liu acting president of the airline. The 29-year veteran and former VP-commercial was named several months after the former leader resigned. Separately, CAL said it has introduced electronic ticketing, becoming the third airline in Asia and the first in Taiwan to implement the service. A CAL spokesman said e-ticketing for domestic flights between Taipei and Kaohsiung began Nov. 4. The system will be expanded to include CAL's foreign routes within six months.
Defense Secretary William Cohen is trying to slow the pilot exodus from military to commercial aviation. In recent congressional testimony he said he plans to focus on post-entry-level pay increases and retirement benefits, which were cut back in 1986. Cohen said retirement benefits are second only to pay in trying to retain mid-career pilots and other skilled personnel in limited supply.
Duff&Phelps Credit Rating Co. has lowered LanChile's credit rating to BBB from BBB+ because of increased competition in the carrier's principal markets, which diminished revenues and yields during the first half of the year. Enrique Cueto, chief executive, said, "We are pleased to be among the few airlines in the world who have an investment grade and believe it is a reflection of LanChile's financial strength." LanChile received an investment grade rating in 1997 shortly before going public on the New York Stock Exchange.
DOT dismissed applications filed by Western Pacific asking DOT for exemption to transfer its dormant certificate to Blue Line as part of WestPac's bankruptcy liquidation procedures (DAILY, April 30). The department said it told WestPac several times that it needed to file information on Blue Line's fitness to gain the exemption. WestPac did not do so, and Blue Line told DOT it no longer is interested in purchasing WestPac's certificate.
TWA applied at DOT for a certificate and exemption to operate scheduled combination service between the U.S. and Canada. It seeks a certificate for the flexibility permitted designated U.S. carriers under the U.S.-Canada air transport agreement to "institute new service in U.S.-Canada markets without the need to first obtain specific operating authority" for a particular city-pair. It requested an exemption for at least two years for service between any point in the U.S. and any point in Canada. (Dockets OST-98-4707, 4708)
World Airways posted a net loss of $1.5 million in the third quarter and an operating profit of $800,000. The loss is an improvement from the $3.7 million deficit in the same 1997 quarter. The airline is trying to improve its sales, cost structure and financial results. "World has been concentrating on developing its strategic direction to better meet our profitability goals and provide adequate flexibility to adjust to our international markets," said Chairman Russell Ray. Revenue fell to $67.5 million from $79.9 million as the carrier flew 11% fewer block hours.
Shuttle America, a new commuter airline based at Bradley Airport, Windsor Locks, Conn., received its FAA operating certificate Friday. The operations specifications enable the carrier to offer scheduled passenger service from Windsor Locks to Buffalo, N.Y., and Wilmington, Del. The carrier, which initially will operate two Dash 8s, is the first new entrant certified by FAA's Certification, Standardization and Evaluation Team, a national team that assists local FAA Flight Standards Offices, such as Windsor Locks, in processing new air carrier certificates.
Madrid Barajas and Paris Charles de Gaulle (Roissy) airports each inaugurated a third runway last week. In Madrid, the 4.4-kilometer runway will increase the airport's capacity to 90 flight movements an hour, up from 75. The Spanish runwaycost 30 billion pesetas (US$180 million). Roissy's new 2.7-kilometer runway is meant to be used for landings only. The airport is engaged in a 1.5 billion French franc ($255 million) investment project to extend the two existing runways and to build two new shorter ones.
ATR said it has placed 23 second-hand ATR regional aircraft with nine airlines, bringing to 35 the number of second-hand ATRs it has placed since the start of the year. ATR said it expects to conclude transactions for 50 units this year.
McDonnell Douglas DC-10 Aircraft Operating Costs Second Quarter 1998 Dollars Per Block Hour DC-10-10 American United Average Crew Cost $1,131 $1,131 $1,066 Fuel&Oil 1,149 1,175 1,165 Rentals 0 13 8
