S&P: US Airways watch still negative

Standard & Poor's ratings on US Airways Group Inc. and its US Airways Inc. subsidiary (both B-/Watch negative/--), which were lowered to current levels Jan. 9, remain on CreditWatch with negative implications, where they were placed on Dec. 10, 2003. S&P plans to conclude its review of the company over the next several weeks.

US Airways Group Inc. (B-/Watch negative/--) reported a first-quarter 2004 net loss of $177 million. This compares to first-quarter 2003 net income of $1.63 billion, which included a large extraordinary gain related to the company's emergence from bankruptcy. Excluding that gain, the 2003 first-quarter result was a net loss of $282 million.

The narrower 2004 loss benefited from cost reductions achieved in bankruptcy and some recovery in revenues, but was nevertheless burdened by the still-weak pricing and high fuel prices.

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