FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report
(Date of earliest event reported)
September 14, 1999
US Airways Group, Inc.
(Commission file number: 1-8444)
and
US Airways, Inc.
(Commission file number: 1-8442)
(Exact names of registrants as specified in their charters)
Delaware US Airways Group, Inc. 54-1194634
(State of incorporation US Airways, Inc. 53-0218143
of both registrants) (I.R.S. Employer Identification Nos.)
US Airways Group, Inc.
2345 Crystal Drive, Arlington, VA 22227
(Address of principal executive offices)
(703) 872-5306
(Registrant's telephone number, including area code)
US Airways, Inc.
2345 Crystal Drive, Arlington, VA 22227
(Address of principal executive offices)
(703) 872-7000
(Registrant's telephone number, including area code)
Item 5. Other Events
On September 14, 1999, US Airways, Inc. (US Airways)(a wholly-owned
subsidiary of US Airways Group, Inc.) provided certain forward-looking
information to the investment community related to its aircraft fleet and
selected operating and financial statistics (see Exhibit 99). In addition,
the board of directors of US Airways Group, Inc. (the "Company") has
authorized the purchase, subject to market and other considerations, from
time to time in the open market or in privately negotiated transactions of
up to an additional $500 million of the Company's outstanding common stock.
Certain of the information contained in the letter to the investment
community should be considered "forward-looking information" which is
subject to a number of risks and uncertainties. The preparation of forward-
looking information requires the use of estimates of future revenues,
expenses, activity levels and economic and market conditions, many of which
are outside of US Airways' control. Specific factors that could cause actual
results to differ materially from those set forth in the forward-looking
information include: economic conditions, labor costs, aviation fuel costs,
competitive pressures on pricing--particularly from lower-cost competitors,
weather conditions, government legislation, consumer perceptions of US
Airways' products, demand for air transportation in the markets in which US
Airways operates and other risks and uncertainties listed from time to time
in US Airways' reports to the United States Securities and Exchange
Commission. Other factors and assumptions not identified above are also
involved in the preparation of forward-looking information, and the failure
of such other factors and assumptions to be realized may also cause actual
results to differ materially from those discussed. US Airways assumes no
obligation to update such estimates to reflect actual results, changes in
assumptions or changes in other factors affecting such estimates.
Item 7. Financial Statements and Exhibits
(c) Exhibit
Designation Description
- ----------- -----------
99 Letter to investment community
dated September 14, 1999
(this space intentionally left blank)
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrants have duly caused this report to be signed on their behalf by
the undersigned hereunto duly authorized.
US Airways Group, Inc. (REGISTRANT)
/s/ Anita P. Beier
Date: September 14, 1999 By: --------------------------------
Anita P. Beier
Vice President and Controller
(Chief Accounting Officer)
US Airways, Inc. (REGISTRANT)
/s/ Anita P. Beier
Date: September 14, 1999 By: --------------------------------
Anita P. Beier
Vice President and Controller
(Chief Accounting Officer)
(this space intentionally left blank)
Exhibit 99
September 14, 1999
Dear Analysts and Investors:
Attached please find the US Airways Investor Update for the month of
August and the Company's Fleet Plan Forecast for fiscal year 1999.
In addition to the attached information, we want to update you on our
stock purchase program and the continued revenue and cost pressures
experienced by US Airways.
Earlier today US Airways' Board of Directors authorized the Company to
purchase up to an additional $500 million of our common stock from time to
time, subject to market and other considerations. This announcement is a
reaffirmation of our belief in the Company's long-term prospects and our
commitment to increase shareholder value. We firmly believe that once our
major labor negotiations are completed, our operational difficulties will
largely be behind us and all our employees will be able to focus on running
a quality airline as we have done in 1996, 1997 and 1998.
Third and fourth quarter earnings are under pressure due to several
factors. First, reductions by the Company in scheduled flying have reduced
revenues, and, without a one-for-one reduction in expense, have led to
lower earnings. Second, the Company continues to be adversely affected by a
high number of flight cancellations. During the months of July and August,
the Company cancelled an average of 130 flights per day representing 6.4%
of the daily schedule and continues to experience high levels of
cancellations in September, resulting in additional lost revenue and
capacity with little expense offsets. Third, this poor operational
performance is creating passenger dissatisfaction, which, we believe, is
impacting our ability to generate revenue.
During the third quarter, we will have produced 6.1 fewer points of
growth than we had anticipated going into the year. Of that, 3.7 points
are from daily operational cancellations, 1.7 points are due to pre-planned
scheduled reductions made inside of 90 days, and 0.7 points are due to
schedule reductions made outside of 90 days.
Under these circumstances, the Company does not expect to report a
profit for the third quarter. Moreover, we expect the third quarter
difficulties to carry over to the fourth quarter with the associated
impacts of capacity reductions and passenger dissatisfaction.
As always, if you have any questions or comments on the materials
provided, please do not hesitate to call me at 703-872-5009.
Very truly yours,
Kimberly A. Holland
Director, Investor Relations
Enclosures
Certain of the information discussed above or enclosed herewith may be
considered forward-looking information. A number of risks and
uncertainties exist, which could cause the actual results to differ
materially from the results projected in such forward-looking information.
Additional information concerning the factors, which could cause actual
results to differ materially from the forward-looking information, will be
contained in a Form 8-K to be filed with the Securities and Exchange
Commission.
<TABLE>
US AIRWAYS INVESTOR UPDATE
US Airways, Inc. (A Wholly-Owned Subsidiary of US Airways Group, Inc.)
September 1999
<CAPTION>
Year-over-Year Percentage Change
----------------------------------------------------------------------
Selected Operating and Financial Statistics August (Actual) September October November FY 1999
-------------- ------ ------ ------ -------
<S> <C> <C> <C> <C> <C>
Available Seat Miles - Scheduled Service
-Domestic 3.1 % 4.2 % 7.2 % 6.7 % 3.2 %
-International 17.0 19.6 19.5 7.3 17.5
--- ---- ---- ---- ----
Total 4.6 % 5.8 % 8.5 % 6.8 % 4.6 %
Revenue Passenger Miles - Scheduled Service
-Domestic (2.5)% (7.3)% 2.0 % 3.6 % (1.3)%
-International 15.5 12.0 11.5 7.8 17.0
---- ---- ---- ---- ----
Total (0.4)% (4.8)% 3.1 % 4.3 % 0.7 %
Passenger Load Factor (3.7) points (7.2) points (3.7) points (1.6) points (2.7) points
Aviation Fuel
-Cost of Aviation Fuel Per Gallon
- Excluding Taxes 37.4 % 39.0 % 36.2 % 43.3 % 11.3 %
-Gallons of Aviation Fuel Consumed 1.3 4.6 2.9 7.5 2.9
Fleet Additions
-A319 0 3 3 2 22
-A320 2 2 0 2 11
-- -- -- -- --
Total 2 5 3 4 33
Fleet Retirements
-B737-200 0 0 2 1 5
-B727-200 - Shuttle* 0 0 1 2 8
-DC9-30 0 1 1 3 16
-- -- -- -- --
Total 0 1 4 6 29
* These aircraft are operated by Shuttle, Inc., a wholly-owned subsidiary of US Airways Group, Inc.
Certain of the information discussed above may be considered forward-looking information. A number of risks and uncertainties
exist which could cause the actual results to differ materially from the results projected in such forward-looking information.
Additional information concerning the factors which could cause actual results to differ materially from the forward-looking
information will be contained in a Form 8-K to be filed with the Securities and Exchange Commission.
</TABLE>
<TABLE>
US AIRWAYS FLEET PLAN
US Airways, Inc. (A Wholly-Owned Subsidiary of US Airways Group, Inc.)
September 1999
<CAPTION>
Number of Aircraft: 1999 Year End
Fleet Plan ---------------------------------------------------------------
as of
Fleet Type 08/31/1999 Average Seats Average Age (yrs.) Owned Leased Total
- ---------- ---------- ------------- ------------------ ----- ------ -----
<S> <C> <C> <C> <C> <C> <C>
B767-200 12 203 10.5 8 4 12
B757-200 34 182 9.2 23 11 34
B727-200 - Shuttle* 11 163 29.6 4 0 4
B737-400 54 144 10.0 19 35 54
MD-80 31 141 17.8 15 16 31
B737-300 85 126 12.7 11 74 85
B737-200 - MetroJet 47 118 17.0 38 4 42
B737-200 17 108 17.7 14 3 17
DC9-30 45 100 22.1 27 7 34
F-100 40 97 9.1 36 4 40
A320 7 142 0.5 0 11 11
A319 17 120 0.6 0 28 28
--- --- ---- --- --- ---
Average Total Aircraft 400 131 12.5 195 197 392
Hushkit Program 1999
as of 8/31/99 Stage 2 Compliance
- ------------------ ------- ----------
B737-200 13 Stage 3
B727-200 - Shuttle* 7 Retire
DC9-30 11 Retire
Firm Order/Options
as of 8/31/99 Firm Reconfirmable Options
- ------------------ ---- ------------- -------
A319/320 130 196 50
A330 10 4 16
* These aircraft are operated by Shuttle, Inc., a wholly-owned subsidiary of US Airways Group, Inc.
Certain of the information discussed above may be considered forward-looking information. A number of
risks and uncertainties exist which could cause the actual results to differ materially from the results
projected in such forward-looking information. Additional information concerning the factors which could
cause actual results to differ materially from the forward-looking information will be contained in a Form
8-K to be filed with the Securities Exchange Commission.
</TABLE>
