US Airways 2005 Annual Report Download - page 185

Table of Contents
America West Airlines, Inc.
Notes to Consolidated Financial Statements — (Continued)
(6) Reclassification of $4 million related to the sale of frequent flier miles and related marketing services to affinity partners from "Operating expenses —
Other" to "Operating revenues — Mainline passenger."
(7) Reclassification of $268 million Express revenue and $285 million Express operating expenses from "Operating revenues — Other" to "Mainline
passenger" revenue and to "Operating expenses — Other."
(8) Reclassification of $28 million related to the sale of frequent flier miles and related marketing services to affinity partners from "Operating expenses —
Other" to "Operating revenues — Other."
(9) Reclassification of $11 million credit related to fuel hedging activity from nonoperating to operating expenses. Reclassification of $32 million related to
the sale of frequent flier miles and related marketing services to affinity partners from "Operating expenses — Other" to "Operating revenues —
Mainline passenger" and "Operating revenues — Other."
(10) Reclassification of $285 million and $2 million of Express operating expenses from "Operating revenues — Other" and "Operating expenses —
Other," respectively.
The operating margin that results from using the gross basis of presentation for Express revenues and expenses does not include passenger revenue
generated by feed into AWA's mainline operations from Express flights, which is referred to as beyond contribution passenger revenue.
5. Special Charges
Special charges included within the statements of operations include the following components (in millions):
Year Ended December 31,
2005 2004 2003
Airbus restructuring $ 57(a) $ — $ —
Sale leaseback transactions 27(b) (1)(g) —
Merger related transition expenses 13(c) — —
Power by the hour program penalties 7(d) — —
Severance due to change in control 2(e) — —
Aircraft returns 1(f) 2(f) (1)(i)
Termination of V2500 power by the hour agreement — (16)(h) —
Elimination of hub operations — Columbus — — 11(j)
Reduction in workforce — — 2(k)
Impairment loss on aircraft — — 3(l)
Other (1) (1) (1)
Total $ 106 $ (16) $ 14
(a) In the third quarter of 2005, in connection with the merger and the Airbus MOU executed between Airbus, US Airways Group, US Airways and AWA,
certain aircraft firm orders were restructured. In connection with that restructuring, US Airways Group and America West Holdings were required to
pay non-refundable restructuring fees. AWA's restructuring fee of $50 million has been classified as a special charge, along with $7 million in
associated capitalized interest. The restructuring fee was paid by means of set-off against existing equipment deposits of AWA held by Airbus.
(b) In the third quarter of 2005, a $27 million loss was incurred related to the sale-leaseback of six 737-300 aircraft and two 757 aircraft.
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