Tue, Apr 14, 2009
But First They Have To Swallow Q1 Lumps
We've seen aircraft manufacturers
preparing for a recession lasting through late 2010. The Obama
administration has sounded cheery by comparison, predicting we'll
see a turnaround by the end of this year.
But now, some analysts say we may see an upturn in airline
travel by this summer.
The Dallas Morning News reports American Airlines parent AMR
Corp. will kick off the earnings season Wednesday with its
first-quarter report... and an expected loss of close to $425
million for the time period.
Combined, US domestic passenger airlines are expected lose a
combined $2 billion for the three months ending March 31, excluding
one-time and special charges. Only low-cost carrier Southwest is
expected to eke out a small profit, thanks to a strong January but
falling numbers in February and March.
But even starting with that handicap, analysts expect the
industry to turn a net profit for the full year.
In a recent report to investors, Robert McAdoo of Avondale
Partners commented, "...the level of pessimism in the marketplace
seems to be fading. Indications are that things may have bottomed
as airlines head into peak travel season."
Among the year-to-year differences which make direct historical
comparisons different, a travel spike caused by the Easter and
Passover season landed in the first quarter last year, but in April
this year.
All told, the consensus among analysts surveyed by the DMN is
that March will go down as the low point, and industry profits will
total a billion dollars in the second quarter and more than $2
billion for full-year 2009.
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