US Airways 2006 Annual Report Download - page 55

Table of Contents
Operating Expenses:
Percent
2005 2004 Change
(In millions)
Operating expenses:
Aircraft fuel and related taxes $ 1,486 991 50.0
Salaries and related costs 1,403 2,177 (35.6)
Aircraft rent 391 399 (2.0)
Aircraft maintenance 339 303 11.9
Other rent and landing fees 420 445 (5.6)
Selling expenses 326 362 (9.9)
Special items, net 15 — nm
Depreciation and amortization 189 220 (14.1)
Other 989 947 4.4
Total mainline operating expenses 5,558 5,844 (4.9)
Express expenses 1,862 1,572 18.5
Total operating expenses $ 7,420 $ 7,416 0.1
Total operating expenses for 2005 were $7.42 billion, which was relatively flat when compared to 2004. Mainline operating
expenses were $5.56 billion for 2005, a decrease of $286 million as compared to 2004. Mainline CASM decreased 1.7% to 10.79 cents in
2005 from 10.98 cents in 2004. The 2005 results include special items of $15 million, which comprised 0.03 cents of mainline CASM for
the period. The decrease in mainline CASM was due to cost reductions achieved as a result of the bankruptcy proceedings, primarily
related to salaries and related costs, which more than offset the increase in aircraft fuel and related taxes as the average fuel per gallon
increased 58% to $1.77 in 2005.
The table below sets forth the major components of mainline CASM for US Airways for the years ended December 31, 2005 and
2004:
Year Ended December 31, Percent
2005 2004 Change
(In cents)
Mainline:
Aircraft fuel and related taxes 2.88 1.86 54.8
Salaries and related costs 2.72 4.09 (33.5)
Aircraft rent 0.76 0.75 1.3
Aircraft maintenance 0.66 0.57 15.8
Other rent and landing fees 0.82 0.84 (2.4)
Selling expenses 0.63 0.68 (7.4)
Depreciation and amortization 0.37 0.41 (9.8)
Special items, net 0.03 — nm
Other 1.92 1.78 7.9
10.79 10.98 (1.7)
Significant changes in the components of mainline CASM are explained as follows:
• Aircraft fuel and related tax expense per ASM increased 54.8% primarily due to a 58.0% increase in the average price per gallon
of fuel from $1.12 in 2004 to $1.77 in 2005, partially offset by a 4.8% decrease in consumption.
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