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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Form 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report: January 25, 1994
USAIR GROUP, INC.
(Commission file number: 1-8444)
and
USAIR, INC.
(Commission file number: 1-8442)
(Exact names of registrants as specified in their charters)
Delaware USAir Group, Inc. 54-1194634
(State of Incorporation) USAir, Inc. 53-0218143
of both registrants) (I.R.S. Employer Identifications Nos.)
USAir Group, Inc.
2345 Crystal Drive, Arlington, VA 22227
(Address of principal executive offices)
(703) 418-5306
(Registrant's telephone number)
USAir, Inc.
2345 Crystal Drive, Arlington, VA 22227
(Address of principal executive offices)
(703) 418-7000
(Registrant's telephone number)
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Item 5. Other Events
- ----------------------
USAir Group, Inc. and USAir, Inc. disseminated a press release
on January 25, 1994 disclosing results of operations for both
companies for the three and twelve months ended December 31, 1993.
Item 7. Financial Statements and Exhibits
- -------------------------------------------
(c) Exhibits
<TABLE>
<CAPTION>
Designation Description
----------- -----------
<C> <S>
99 Press release dated January 25, 1994 of
USAir Group, Inc. and USAir, Inc., with
Consolidated Statements of Operations for
each company.
</TABLE>
2
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SIGNATURES
----------
Pursuant to the requirements of the Securities and Exchange
Act of 1934, the registrants have duly caused this report to be
signed on their behalf by the undersigned thereunto duly
authorized.
USAir Group, Inc.
By: /s/ Ann Greer-Rector
--------------------------------
Ann Greer-Rector
Vice President and Controller
(Principal Accounting Officer)
USAir, Inc.
By: /s/ Ann Greer-Rector
--------------------------------
Ann Greer-Rector
Vice President and Controller
(Principal Accounting Officer)
Date: January 25, 1994
3
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USAIR GROUP REPORTS 1993
------------------------
YEAR-END, FOURTH QUARTER RESULTS
--------------------------------
ARLINGTON, VA, Jan. 25, 1994--USAir Group today reported a 1993 net
loss of $393.1 million, including non-recurring charges of $156.2
million, on revenue of $7.1 billion. These results compare positively
with a net loss of $1.2 billion, including non-recurring charges of
$761.7 million, on revenue of $6.7 billion for 1992.
For the fourth quarter, USAir Group reported a net loss of $116.5
million, including non-recurring charges of $60.2 million, on revenue
of $1.8 billion. This compares with a net loss of $254.0 million,
including non-recurring charges of $143.9 million, on revenue of $1.6
billion for the same quarter of 1992.
Full-Year Results
-----------------
Results for 1993 include $156.2 million in one-time, pre-tax charges,
including the cumulative effect of a retroactive change in the method
of accounting for postemployment benefits (FAS 112) and charges
associated with employee workforce reductions and wage concessions.
Before non-recurring charges, USAir Group's operating profit for the
year 1993 was $23.7 million compared with a $223.1 million operating
loss, before non-recurring charges, for 1992. The pre-tax loss, before
non-recurring charges, was $236.9 million for 1993, which compares with
a pre-tax loss, before non-recurring charges, of $467.2 million in 1992.
Loss per common share before the cumulative effect of FAS 112 and
after preferred stock dividend requirements for 1993 was $7.68 on 55.1
million shares outstanding. This compares with a loss per common share
of $13.88 on 47.0 million shares outstanding in 1992. Before non-
recurring items, the loss per share after preferred stock dividend
requirements for 1993 was $5.64 compared with $11.04 for 1992.
The adoption of FAS 112, which occured in the third quarter of 1993,
resulted in a charge of $43.7 million retroactive to January 1, 1993.
Fourth Quarter Results
----------------------
Results for the fourth quarter of 1993 include $60.2 million in pre-
tax, non-recurring charges which include the write-down of certain
airport facilities and charges associated with employee wage conces-
sions.
(MORE)
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PAGE 2: USAIR GROUP REPORTS...
- ------------------------------
For the fourth quarter, USAir Group's operating income, before non-
recurring items, was $13.7 million, which compares with an operating
loss, before non-recurring items, of $45.9 million for the fourth
quarter of 1992. The pre-tax loss for the quarter, before non-recurring
charges, was $56.3 million, which compares with a pre-tax loss, before
non-recurring charges, of $110.1 million in 1992.
Per share loss for the fourth quarter of 1993 was $2.29 versus $5.66
in 1992. Before non-recurring items, the loss per share was $1.27 in
the fourth quarter of 1993 versus $2.61 before non-recurring charges in
the fourth quarter of 1992.
"While we have made substantial progress in reducing our losses for
the year and for the fourth quarter, our financial results remain
unsatisfactory," said USAir Chairman, President and CEO Seth E.
Schofield.
"To enhance USAir's ability to compete with low-cost, low-fare
airlines, we are taking action to reduce our costs and improve the
productivity of our assets and personnel, including introduction later
this year of a new short-haul service program, which we expect will
permit us to increase capacity and lower unit costs in certain markets
under 500 miles."
-30-
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<TABLE>
PRESS RELEASE
USAir Group, Inc.
Consolidated Statements of Operations
Adjusted for Non-Recurring Items
(unaudited)
(dollars in millions except per share amounts)
<CAPTION>
Three Months Years
Ended December 31, Better(Worse) Ended December 31, Better(Worse)
------------------ ------------- ------------------ -------------
1993 1992 Amount % 1993 1992 Amount %
---- ---- ------ --- ---- ---- ------ ---
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Operating Revenues $1,802.5 $1,634.8 $167.7 10.3 % $7,083.2 $ 6,686.4 $ 396.8 5.9 %
Operating Expenses 1,835.6 1,788.1 (47.5) (2.7)% 7,158.6 7,016.9 (141.7) (2.0)%
------- ------- ------- --------
Operating Profit (Loss) * (33.1) (153.3) 120.2 78.4 % (75.4) (330.5) 255.1 77.2 %
Non-Recurring Items - Add (Deduct) (46.8) (107.4) (99.1) (107.4)
------- ------- ------- --------
Adjusted Operating Profit (Loss) 13.7 (45.9) 59.6 N/M 23.7 (223.1) 246.8 N/M
Non-Operating Income (Expense) (83.4) (100.7) 17.3 17.2 % (274.0) (270.3) (3.7) (1.4)%
------- ------- ------- --------
Pre-Tax Profit (Loss) * (116.5) (254.0) 137.5 54.1 % (349.4) (600.8) 251.4 41.8 %
Non-Recurring Non-Op - Add (Deduct) (13.4) (36.5) (13.4) (26.2)
Adjusted Pre-Tax Profit (Loss) (56.3) (110.1) 53.8 48.9 % (236.9) (467.2) 230.3 49.3 %
FAS 106 Transition Expense - - - 745.7
FAS 112 Transition Expense - - 43.7 -
Tax Provision (Credit) - - - (117.6)
------- ------- ------- --------
Net Income (Loss) * $ (116.5) $ (254.0) $137.5 54.1 % $ (393.1) $(1,228.9) $ 835.8 68.0 %
======= ======= ======= ========
Non-Recurring Items -
Operating Expense:
Employee Payback $ (36.8) $ - $ (36.8) $ -
Reserve for Non-Operating
Aircraft - (107.4) 18.4 (107.4)
Reserve for Airport Facilities (8.9) - (8.9) -
1993 Early Retirement Incentive/
Furlough 1.9 - (68.8) -
Other (3.0) - (3.0) -
------- ------- ------- --------
Total $ (46.8) $ (107.4) $ (99.1) $ (107.4)
======= ======= ======= ========
Non-Recurring Items -
Non-Operaring Expense:
Loss on Investment in Galileo $ (8.8) $ - $ (8.8) $ -
Write Down Airport Facilities (4.6) - (4.6) -
Loss on Sale of MD-82 Aircraft - (34.1) - (34.1)
Gain on Sale of GAG Subsidaries - - - 10.3
Other - (2.4) - (2.4)
------- ------- ------- --------
Total $ (13.4) $ (36.5) $ (13.4) $ (26.2)
======= ======= ======= ========
Income (Loss) Per Common Share:
As Reported - Before Accounting
Changes $ (2.29) $ (5.66) $3.37 59.5 % $ (7.68) $ (13.88) $ 6.20 44.7 %
Effect of Non-Recurring Items
Listed Above (1.02) (3.05) (2.04) (2.84)
------- ------- ------- --------
Income (Loss) Per Share Before
Non-Recurring Items (1.27) (2.61) $1.34 51.3 % (5.64) (11.04) $ 5.40 48.9 %
As Reported - Effect FAS 106
and 112 - - (0.80) (13.35)
Effect of Non-Recurring Items
Listed Above (1.02) (3.05) (2.04) (2.84)
------- ------- ------- --------
Income (Loss) Per Share
as Reported $ (2.29) $ (5.66) $3.37 59.5 % $ (8.48) $ (27.23) $18.75 68.9 %
======= ======= ======= ========
* 1992 includes 10/92 IAM strike impact $(45) million [Revenue $(65) million and Expense $(20) million].
N/M - Not Meaningful.
</TABLE>
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<TABLE>
PRESS RELEASE
USAir Group, Inc.
CONSOLIDATED STATEMENTS OF OPERATIONS
<CAPTION>
Three Months Ended Twelve Months Ended
December 31, December 31,
------------------------ -----------------------
1993 1992 1993 1992
---- ---- ---- ----
(unaudited)
(in thousands, except per share amounts)
<S> <C> <C> <C> <C>
Operating Revenues
Passenger Transportation $1,656,920 $1,521,214 $6,554,926 $6,198,409
Cargo and Freight 46,135 43,360 173,824 172,360
Other 99,436 70,254 354,458 315,643
--------- --------- --------- ---------
Total Operating Revenues 1,802,491 1,634,828 7,083,208 6,686,412
Operating Expenses
Personnel Costs 736,355 617,379 2,841,344 2,623,645
Aviation Fuel 178,341 187,387 710,109 753,301
Commissions 154,823 142,283 596,779 569,583
Other Rent and Landing Fees 131,574 109,152 470,093 405,842
Aircraft Rent 116,378 193,441 472,622 530,046
Aircraft Maintenance 98,401 118,019 374,084 379,870
Depreciation and Amortization 78,422 83,856 306,330 309,368
Other, Net 341,313 336,607 1,387,273 1,445,278
--------- --------- --------- ---------
Total Operating Expenses 1,835,607 1,788,124 7,158,634 7,016,933
--------- --------- --------- ---------
Operating Income (Loss) (33,116) (153,296) (75,426) (330,521)
Other Income (Expense)
Interest Income 4,814 2,622 12,632 9,898
Interest Expense (63,823) (62,762) (249,916) (248,691)
Interest Capitalized 3,546 6,050 17,763 27,802
Other, Net (27,961) (46,655) (54,420) (59,306)
--------- --------- --------- ---------
Total Income (Expense), Net (83,424) (100,745) (273,941) (270,297)
Income (Loss) Before Taxes and Cumulative
Effect of Accounting Changes (116,540) (254,041) (349,367) (600,818)
Income Tax Credit - - - -
--------- --------- --------- ---------
Income (Loss) Before Cumulative Effect
of Accounting Changes (116,540) (254,041) (349,367) (600,818)
Cumulative Effect of Changes in Method of
Accounting for Postemployment Benefit
in 1993 and Postretirement Benefits Other
Than Pensions (Net of Income Tax Benefit
of $117,571) in 1992 - - (43,749) (628,098)
--------- --------- --------- ---------
Net Income (Loss) (116,540) (254,041) (393,116) (1,228,916)
Preferred Dividend Requirement (19,157) (12,942) (73,651) (51,766)
--------- --------- --------- ---------
Net Income (Loss) Applicable to
Common Stockholders $ (135,697) $ (266,983) $ (466,767) $(1,280,682)
========= ========= ========= =========
Income (Loss) per Common Share
Before Accounting Changes $ (2.29) $ (5.66) $ (7.68) $ (13.88)
Effect of Accounting Changes - - (0.80) (13.35)
--------- --------- --------- ---------
Income (Loss) Per Common Share $ (2.29) $ (5.66) $ (8.48) $ (27.23)
========= ========= ========= =========
Shares Used For Computation (000) 59,190 47,197 55,070 47,026
</TABLE>
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<TABLE>
USAir, Inc. PRESS RELEASE
(A Wholly-Owned Subsidiary of USAir Group, Inc.)
CONSOLIDATED STATEMENTS OF OPERATIONS
<CAPTION>
Three Months Ended December 31, Twelve Months Ended December 31,
------------------------------- --------------------------------
1993 1992 % Change 1993 1992 % Change
---- ---- -------- ---- ---- --------
(unaudited)
(dollars in thousands)
<S> <C> <C> <C> <C> <C> <C>
Operating Revenues
Passenger Transportation $1,539,921 $1,411,804 9.1 $6,081,788 $5,785,830 5.1
Cargo and Other 150,350 117,877 27.5 541,260 449,792 20.3
--------- --------- --------- ---------
Total Operating Revenues 1,690,271 1,529,681 10.5 6,623,048 6,235,622 6.2
Operating Expenses
Personnel Costs 699,040 584,328 19.6 2,698,039 2,492,424 8.2
Aviation Fuel 170,262 178,673 (4.7) 677,859 720,649 (5.9)
Commissions 145,802 133,760 9.0 559,793 537,688 4.1
Other Rent & Landing Fees 127,791 105,744 20.8 455,887 391,215 16.5
Aircraft Rent 105,344 184,454 (42.9) 431,616 496,061 (13.0)
Aircraft Maintenance 79,602 105,311 (24.4) 308,890 318,986 (3.2)
Depreciation & Amortization 71,608 77,223 (7.3) 279,077 282,567 (1.2)
Other Expenses, Net 329,125 329,480 (0.1) 1,340,627 1,365,621 (1.8)
--------- --------- --------- ---------
Total Operating Expenses 1,728,574 1,698,973 1.7 6,751,788 6,605,211 2.2
--------- --------- --------- ---------
Operating Loss (38,303) (169,292) (77.4) (128,740) (369,589) (65.2)
Other Income (Expense)
Interest Income 5,223 10,590 (50.7) 24,794 48,866 (49.3)
Interest Expense (63,490) (57,572) 10.3 (238,628) (229,643) 3.9
Interest Capitalized 3,546 6,045 (41.3) 17,754 27,181 (34.7)
Other, Net (26,843) (45,415) (40.9) (50,228) (66,491) (24.5)
--------- --------- --------- ---------
Other Income (Exp.), Net (81,564) (86,352) (5.5) (246,308) (220,087) 11.9
--------- --------- --------- ---------
Loss Before Taxes and
Cumulative Effect of
Accounting Changes (119,867) (255,644) (53.1) (375,048) (589,676) (36.4)
Income Tax Credit - - NM - - NM
--------- --------- --------- ---------
Loss Before Cumulative Effect
of Accounting Changes (119,867) (255,644) (53.1) (375,048) (589,676) (36.4)
Cumulative Effect of Changes
in Method of Accounting for
Postemployment Benefits in
1993 and Postretirement
Benefits Other Than Pensions
(Net of Income Tax Benefit
of $106,721) in 1992 - - NM (43,749) (638,822) (93.2)
--------- --------- --------- ---------
Net Loss $ (119,867) $ (255,644) (53.1) $ (418,797) $(1,228,498) (65.9)
========= ========= ========= ==========
Airline Operating and Financial Statistics (Note 1)
(* denotes scheduled service only) (c = cents) (NM = Not Meaningful)
Revenue Passengers (Thousands)* 14,210 12,644 12.4 53,678 54,655 (1.8)
Avg. Psgr. Journey (Miles)* 637 643 (0.9) 656 642 2.2
Rev. Psgr. Miles (Millions)* 9,055 8,128 11.4 35,221 35,097 0.4
Avail. Seat Miles (Millions)* 15,088 14,489 4.1 59,485 59,667 (0.3)
Passenger Load Factor* 60.0 % 56.1 % 3.9 pts 59.2 % 58.8 % 0.4 pts
Yield* 17.01 c 17.37 c (2.1) 17.27 c 16.49 c 4.7
Passenger Revenue per ASM* 10.21 c 9.74 c 4.8 10.22 c 9.70 c 5.4
Revenue per ASM (Note 2) 11.07 c 10.50 c 5.4 11.04 c 10.38 c 6.4
Average Stage Length (Miles)* 534 526 1.5 536 516 3.9
Cost per ASM (Note 2) 11.01 c 10.93 c 0.7 11.09 c 10.82 c 2.5
Total Rev.Psgr.Miles (Millions) 9,126 8,194 11.4 35,529 35,436 0.3
Total ASMs (Millions) 15,176 14,566 4.2 59,841 60,052 (0.4)
Rev. Aircraft Miles (Millions)* 117 114 2.6 462 473 (2.3)
Breakeven Load Factor (Net)
(Note 2) 62.0 % 60.3 % 1.7 pts 61.7 % 63.2 % (1.5) pts
Cost of Fuel Per Gallon 57.72 c 62.69 c (7.9) 58.40 c 60.94 c (4.2)
Gal. of Fuel Consumed (Millions) 295 285 3.5 1,161 1,183 (1.9)
Note 1. All operating statistics exclude flights operated by USAir under a wet lease arrangement
with British Airways ("wet lease").
Note 2. Financial statistics exclude non-recurring charges. Financial statistics also exclude the
revenue and expense (which amounts net to zero) generated under the wet lease arrangement.
Wet lease amounts of $10.2 million and $17.1 million have been excluded from the fourth
quarter and year 1993, respectively, from both Other Revenue and Other Expense for purposes
of financial statistic calculation.
</TABLE>
