US Airways 2005 Annual Report Download - page 68

Table of Contents
debt and a $1 million volume incentive earned due to certain affinity card sales levels meeting certain contract thresholds in 2004 also contributed to the
year-over-year decrease. The 2003 period includes a $4 million gain related to the purchase and subsequent exchange of an A320 airframe.
Express expenses increased 30.3% in 2004 to $374 million from $287 million in 2003. Aircraft operating expense for 2004 was $155 million, which
accounted for $24 million of the year-over-year increase in Express operating expenses. Aircraft fuel expense was $102 million in 2004, which accounted for
an additional $41 million of the year-over-year increase.
AWA had net nonoperating expense of $69 million in 2004 compared to net nonoperating income of $24 million in 2003. The 2003 period benefited from
$81 million of federal government assistance received under the Emergency Wartime Supplemental Appropriations Act to provide certain aviation-related
assistance. (See note 14, "Nonoperating Income (Expenses) — Other, Net" to the consolidated financial statements in Item 8B of this report.) Interest income
and interest expense were relatively flat year-over-year.
The 2004 period included a $1 million gain on the disposition of property and equipment due principally to the sale of two Boeing 737-200 aircraft and a
$1 million charge for the write-off of debt issuance costs in connection with the refinancing of the term loan. The 2003 period included a $10 million gain
related to the sale of an investment in Hotwire.com. (See note 14, "Nonoperating Income (Expenses) — Other, Net" to the consolidated financial statements in
Item 8B of this report)
US Airways' Results of Operations
In connection with emergence from the first bankruptcy in March 2003 and the second bankruptcy in September 2005, US Airways adopted fresh-start
reporting in accordance with AICPA Statement of Position 90-7, "Financial Reporting by Entities in Reorganization Under the Bankruptcy Code." As a result
of the application of fresh-start reporting, the financial statements prior to March 31, 2003 are not comparable with the financial statements for the period
April 1, 2003 to September 30, 2005, nor is either period comparable to periods after September 30, 2005. However, for purposes of discussion of the results
of operations, full year 2005 has been compared to 2004 and 2004 has been compared to full year 2003, as presented in the table below. While the effective
date of the plan of reorganization and the merger was September 27, 2005, the results of operations for US Airways during the four day period from
September 27 through September 30, 2005 are not material to the financial statement presentation. References to "Successor Company" refer to US Airways
on or after September 30, 2005, after giving effect to the application of fresh start reporting for the second bankruptcy. References to "Predecessor Company"
refer to US Airways prior to September 30, 2005.
US AIRWAYS, INC.
Combined Successor and Predecessor Company Statement of Operations
For the Years Ended December 31, 2005, 2004 and 2003
(in millions)
2005(a) 2004 2003(b)
Operating revenues:
Mainline passenger $ 4,861 $ 4,969 $ 4,943
Express passenger 1,620 1,379 1,208
Cargo 95 132 132
Other 636 593 479
Total operating revenues 7,212 7,073 6,762
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