American, Southwest, Continental Make Money

There was more good financial news for airlines this week, as cost-cutting measures combined with increasing demand have been working together to boost the industry.

AMR, the parent of Fort Worth, TX-based American Airlines, reported earning $81 million in the first quarter, after a loss of $92 million in the first quarter of 2006. That healthy gain comes despite a drop in the carrier's domestic bookings, according to Bloomberg News. An increase in international travel made up for it.

Chairman and CEO Gerard Arpey said the results show American, which posted its first full year profit in five years in 2006, is on the "right track" for a healthy performance in 2007, as well.

Meanwhile, American's cross-town rival, Dallas-based Southwest Airlines, also posted higher first quarter earnings, to the tune of $93 million.

That isn't unfamiliar territory for Southwest, which has posted consistent profits as other domestic airlines have suffered. The news comes as fuel hedges the low-cost carrier has had in place for years -- stabilizing the high cost of fuel -- gradually start to decrease in coming years.

Further south, Houston-based Continental Airlines reported net income of $22 million... compared to a loss of $66 million for the same period in 2006. It's Continental's first profit for the quarter since before 9/11.

FMI: www.aa.com, www.southwest.com, www.continental.com