US Airways 2003 Annual Report Download - page 98

Table of Contents
13. Related Party Transactions
(a) Parent company
US Airways provides loans to US Airways Group which arise in the normal course of business and bear interest at market rates, which are reset
quarterly. US Airways' net receivable from US Airways Group for these loans was $1 million and $129 million as of December 31, 2003 and 2002,
respectively.
US Airways recorded interest income of $1 million for the three months ended March 31, 2003, $9 million and $14 million for the years ended
December 31, 2002 and 2001, respectively, related to the above transactions. No interest income was recorded for the nine months ended December 31, 2003.
(b) Airline subsidiaries of US Airways Group
US Airways purchases all of the capacity (available seat miles or ASMs) generated by US Airways Group's wholly owned regional airline subsidiaries
at a rate per ASM that is periodically determined by US Airways and, concurrently, recognizes revenues that result primarily from passengers being carried by
these affiliated companies. The rate per ASM that US Airways pays is based on estimates of the costs incurred to supply the capacity. US Airways recognized
US Airways Express capacity purchase expense of $349 million for the nine months ended December 31, 2003, $112 million for the three months ended
March 31, 2003, and $559 million and $448 million for the years ended December 31, 2002 and 2001, respectively, related to this program.
US Airways provides various services to these regional airlines including passenger handling, maintenance and catering. US Airways recognized other
operating revenues of $40 million for the nine months ended December 31, 2003, $12 million for the three months ended March 31, 2003, and $63 million
related to these services for each of the years ended December 31, 2002 and 2001. These regional airlines also perform passenger and ground handling for US
Airways at certain airports for which US Airways recognized other operating expenses of $55 million for the nine months ended December 31, 2003, $15
million for the three months ended March 31, 2003, and $71 million and $58 million for the years ended December 31, 2002 and 2001, respectively, related to
these expenses. US Airways also leases or subleases certain aircraft to these regional airline subsidiaries. US Airways recognized other operating revenues
related to these arrangements of $12 million for the nine months ended December 31, 2003, $2 million for the three months ended March 31, 2003, and $7
million and $8 million for the years ended December 31, 2002 and 2001, respectively.
US Airways' receivables from and payables to these regional airlines were $10 million and $48 million, respectively, as of December 31, 2003 and $15
million and $54 million, respectively, as of December 31, 2002.
(c) Other US Airways Group subsidiaries
US Airways purchases a portion of its aviation fuel from US Airways Group's wholly owned subsidiary, Material Services Company, Inc. (MSC),
which acts as a fuel wholesaler to US Airways in certain circumstances. US Airways' aviation fuel purchases from MSC were $9 million for the nine months
ended December 31, 2003, $11 million for the three months ended March 31, 2003, and $13 million and $18 million for the years ended December 31, 2002
and 2001, respectively. US Airways' payable to MSC was $8 million and $1 million as of December 31, 2003 and 2002, respectively.
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