US Airways' fuel hedging strategy negatively impacted its financial performance during the third quarter, although the carrier succeeded in dramatically narrowing its losses for the three-month period.
The company incurred a third quarter net loss of $80 million compared to the $866 million loss it recorded in the third quarter of 2008.
Revenue for the three months ended 30 September declined by 16.6% to over $2.7 billion due to a near 4% reduction in total available seat mile (ASM) capacity. Expenses declined by 31.3% to $2.7 billion.
US Airways recorded a third quarter operating profit of $6 million versus a year-earlier loss of $689 million.
The carrier notes, however, that it reported a realized fuel hedging loss of $50 million compared to a fuel hedging gain of $68 million in the third quarter of 2008.
Excluding special items and net realized losses/gains on fuel hedging transactions, US Airways posted third quarter 2009 operating income of $23 million and a net loss of $60 million.
"Our third quarter financial results reflect the soft, but improving economic environment. Our team is doing an excellent job of managing through this downturn, including reporting industry leading operations performance, maintaining diligent cost control and delivering meaningful a la carte revenue generation," says US Airways chairman and CEO Doug Parker.
"As we look out at the improving demand environment for both business and leisure travel, US Airways is in an excellent position to capitalize on the recovering economy."
As of 30 September, US Airways had $2 billion in total cash and investments, of which $0.5 billion was restricted.