By Sarah Townsend
Data from US Dept of Transportation shows strong performance despite claims of 'unfair competition' from UAE, Qatar carriers
US scheduled passenger airlines reported a total after-tax net profit of $9.3 billion in the third quarter of 2015, up from $5.5 billion in the second quarter of 2015 and $3.1 billion in the third quarter of 2014, according to official statistics.
Data published by the US Department of Transportation’s Bureau of Transportation Statistics (BTS), shows that the third quarter of 2015 was the tenth consecutive quarter that the 25 US scheduled service passenger airlines reported an after-tax net profit as a group.
It was also the highest quarterly after-tax net profit since the first quarter of 2006.
The figures come amid an ongoing spat between major US carriers and Gulf airlines. US airlines have claimed “unfair competition” from Gulf airlines is impacting on their business, saying the likes of Emirates, Etihad and Qatar AIrways are being supported by government subsidies - a claim strongly denied.
In addition to the after-tax net profit of $9.3 billion – which was based on net income reports – the scheduled service passenger airlines reported $8.8 billion in pre-tax operating profit in the third quarter of 2015, up from $8.2 billion in the second quarter of 2015 and $5.5 billion in the third quarter of 2014.
The airlines reported a total pre-tax operating profit for the eighteenth consecutive quarter.
The BTS noted that net income (after tax) and operating profit (pre-tax) are two different measures of airline financial performance. Net profit or loss may include non-operating income and expenses, nonrecurring items or income taxes, it said, and operating profit or loss is calculated from operating revenues and expenses before taxes and other nonrecurring items.
With this in mind, the BTS reported that total operating revenue for US passenger airlines in the third-quarter of 2015 was $45.2 billion. Airlines collected $34.1 billion from fares, representing 75.4 percent of total third-quarter operating revenue.
Total operating expenses for all passenger airlines in the third-quarter of 2015 was $36.4 billion, of which fuel costs accounted for $7.1 billion, or 19.4 percent, and labour costs accounted for $11.9 billion, or 32.6 percent.
In the third quarter, passenger airlines collected a total of $1.0 billion in baggage fees – 2.3 percent of total operating revenue – and $755 million from reservation change fees, 1.7 percent of total operating revenue.
Fees are included for calculations of net income, operating revenue and operating profit or loss, the statement noted.
Profit is nothing to do with Gulf airlines... It's because fuel now costs USD35 a barrel from USD100+ 18 months ago.