Tuesday, April 21, 1998 | 10:10 a.m.
America West Airlines, one of McCarran International Airport's busiest carriers, reported record quarterly earnings today.
And Northwest Airlines, the company planning to initiate nonstop service between Las Vegas and Tokyo, beat analysts' estimates with its performance.
Phoenix-based America West, the No. 2 operator at McCarran by passenger volume, reported net income of $25 million, 80 percent more than the $14 million profit recorded the same quarter a year ago.
The company's performance occurred at the same time the number of passengers using the airline in Las Vegas has fallen. In March, America West's totals were down 18.7 percent to 441,186 passengers, the steepest drop in the quarter. The company expects its numbers to grow in May when a new schedule bringing red-eye passengers into Las Vegas earlier takes effect.
America West's record income was based on revenue of $471 million for the quarter, a 1.9 percent increase over the $462 million reported for the same quarter in 1997.
Executives said profits were up because of low fuel costs and due to the implementation of a revenue management strategy that emphasizes greater use of resources on the airline's most profitable routes. That's why the company's Las Vegas passenger counts are falling at a time when the airline is most profitable. Leisure markets like Las Vegas traditionally yield lower profits.
Northwest Airlines, meanwhile, performed above expectations. Earlier this month, the company announced it would initiate twice-a-week nonstop service between Las Vegas and Tokyo.
The Minneapolis-based company said its first-quarter profit rose 10 percent as strong demand for travel in the United States and Europe and lower fuel prices made up for falling traffic in Asia.
The fourth-largest U.S. airline said net income rose to $71 million, or 66 cents a diluted share, from $65 million, or 53 cents, a year earlier. Revenue rose 2.2 percent to $2.43 billion from $2.38 billion. Analysts expected earnings of 49 cents a share, the average estimate in a First Call survey.
The results mirror the better-than-expected performance of other U.S. airlines this quarter as they benefit from lower fuel costs and strong U.S. demand.
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