US Airways 2009 Annual Report Download - page 60

Table of Contents
including the Barclays pre-purchased miles, Airbus advance and spare parts and engine loans. Proceeds also included the financing
associated with the purchase of 14 Embraer aircraft and five Airbus aircraft and $145 million in proceeds from the refinancing of certain
aircraft equipment notes. Debt repayments were $734 million, including a $400 million paydown at par of our Citicorp credit facility, a
$100 million prepayment of certain indebtedness incurred as part of our October 2008 financing transactions and $97 million related to
the $145 million aircraft equipment note refinancing discussed above. Financing activities in 2008 also included $179 million in net
proceeds from the issuance of common stock as a result of a public stock offering of 21.85 million common shares during the third
quarter of 2008.
2008 Compared to 2007
Net cash used in operating activities was $980 million in 2008 as compared to net cash provided by operating activities of $451 million
in 2007. The period-over-period decrease of $1.43 billion is due principally to our net loss for 2008, which was driven by record high fuel
prices. Our mainline and Express fuel expense was $1.36 billion higher in 2008 than in 2007 on slightly lower capacity. Additionally, the
2008 period included operating cash outflows of $321 million related to fuel hedging transactions versus operating cash inflows of
$106 million related to fuel hedging transactions in the 2007 period. The substantial decrease in the fuel prices in the latter part of 2008,
while a significant positive development, had the near-term liquidity impact of reducing our operating cash flow as we were required to
use cash from operations to collateralize our counterparties in connection with our fuel hedging positions. The increase in fuel costs and
fuel hedge collateral was partially offset by an increase in revenue of $418 million due to a 3.1% increase in mainline and Express
PRASM and our new revenue initiatives that went into effect in 2008.
Net cash used in investing activities was $915 million in 2008 as compared to net cash provided by investing activities of $269 million
in 2007. Principal investing activities in 2008 included expenditures for property and equipment totaling $1.07 billion, including the
purchase of 14 Embraer aircraft, five Airbus aircraft and a $139 million net increase in equipment purchase deposits for aircraft on order,
as well as a $74 million increase in restricted cash, offset in part by net sales of investments in marketable securities of $206 million. The
change in the 2008 restricted cash balance was due to changes in the amount of holdback held by certain credit card processors for
advance ticket sales for which we had not yet provided air transportation. Principal investing activities in 2007 included net sales of
investments in marketable securities of $612 million, a decrease in restricted cash of $200 million and $56 million in proceeds from the
sale of investments in ARINC and Sabre, offset in part by expenditures for property and equipment totaling $603 million, including the
purchase of nine Embraer aircraft and a net increase in equipment purchase deposits of $80 million. The net sales of investments in
marketable securities in 2007 were primarily certain auction rate securities sold at par value in the third quarter of 2007. The change in
the 2007 restricted cash balance was due to changes in the amount of holdback held by certain credit card processors.
Net cash provided by financing activities was $981 million and $112 million in 2008 and 2007, respectively. Principal financing
activities in 2008 included proceeds from the issuance of debt of $1.59 billion, of which $800 million was from the series of financing
transactions completed in October 2008, including the Barclays pre-purchased miles, Airbus advance and spare parts and engine loans.
Proceeds also included the financing associated with the purchase of 14 Embraer aircraft and five Airbus aircraft and $145 million in
proceeds from the refinancing of certain aircraft equipment notes. Debt repayments were $734 million, including a $400 million paydown
at par of our Citicorp credit facility, a $100 million prepayment of certain indebtedness incurred as part of our October 2008 financing
transactions and $97 million related to the $145 million aircraft equipment note refinancing discussed above. Financing activities in 2008
also included $179 million in net proceeds from the issuance of common stock as a result of a public stock offering of 21.85 million
common shares during the third quarter of 2008. Principal financing activities in 2007 included proceeds from the issuance of debt of
$1.8 billion, including $1.6 billion generated from the Citicorp credit facility and proceeds from property and equipment financings. Debt
repayments were $1.68 billion and, using the proceeds from the Citicorp credit facility, included the repayment in full of the balances
outstanding on the $1.25 billion GE loan, the Barclays Bank Delaware prepaid miles loan of $325 million and a GECC credit facility of
$19 million.
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