US Airways 2007 Annual Report Download - page 172

Table of Contents
US Airways, Inc.
Notes to Consolidated Financial Statements — (Continued)
11. Related party transactions
The following represents net payable balances with related parties as of December 31, 2007 and 2006 (in millions):
December 31,
2007 2006
US Airways Group $ 986 $ 2,542
US Airways Group wholly owned subsidiaries 81 62
$ 1,067 $ 2,604
(a) Parent Company
The net payable to US Airways Group consists of $1.1 billion due to debt previously recorded at US Airways which was refinanced
with proceeds from the 2006 refinancing by US Airways Group. Prior to the contribution of 100% of US Airways Group's equity interest
in America West Holdings to US Airways on September 26, 2007, US Airways Group contributed all related party receivables from
America West Holdings and AWA to the capital of America West Holdings and AWA resulting in a $1.8 billion decrease in the related
party payable to US Airways Group. The remainder of the payable to US Airways Group is a result of funds provided to and received
from US Airways Group that arise in the normal course of business.
US Airways recorded interest expense for the years ended December 31, 2007 and 2006, the three months ended December 31,
2005 and the nine months ended September 30, 2005 of $86 million, $70 million, $6 million and $1 million, respectively, related to the
above transactions and other transactions with wholly owned subsidiaries of US Airways Group as described below. Interest is calculated
at market rates, which are reset quarterly.
(b) Subsidiaries of US Airways Group
The net payable to US Airways Group's wholly owned subsidiaries consists of amounts due under regional capacity agreements
with the other airline subsidiaries and fuel purchase arrangements with a non-airline subsidiary.
US Airways purchases all of the capacity (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 for the years ended December 31, 2007 and 2006,
the three months ended December 31, 2005 and the nine months ended September 30, 2005 of $455 million, $433 million, $96 million
and $306 million, 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 for the years ended December 31, 2007 and 2006, the three months ended December 31,
2005 and the nine months ended September 30, 2005 of $95 million, $96 million, $22 million and $64 million, respectively, related to
these services. These regional airlines also perform passenger and ground handling services for US Airways at certain airports, for which
US Airways recognized other operating expenses for the years ended December 31, 2007 and 2006, the three months ended
December 31, 2005 and the nine months ended September 30, 2005 of $156 million, $145 million, $32 million and $100 million,
respectively. US Airways also leases or subleases certain aircraft to these regional airline subsidiaries. US Airways recognized other
operating revenues related to these arrangements for the years ended December 31, 2007 and 2006, the three months ended December 31,
2005 and the nine months ended September 30, 2005 of $78 million, $80 million, $21 million and $65 million, respectively.
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