Higher taxes have reduced the 3rd quarter profits for the U.S. Airways. However, the airline managed to overshoot the expectations of Wall Street by adding more traffic and charging higher fees on an average. The fifth largest airline of the world managed to push revenues northwards by attracting more passengers. Including the regional flights operated by the airlines, tax attorneys have observed a growth of 5% in miles travelled, and about 4.4% in the average charges paid per mile.
A Growing Company
Tax lawyers have stated that prior to the tax deductions and deductions applicable for special terms, the quarter seemed to be one of epic proportions. Just a week back the parent company, AMR Corp posted its brightest quarterly numbers excluding the costs associated with bankruptcy restructuring. This is what many people say should have happened to GM. GM should have not been bailed out at all and forced to slide into bankruptcy only. Why did President bail out GM? Was it to protect union jobs when unions were the primary reason GM failed in the first place? Will America ever get paid back?
These results could in fact bolster the argument put forth by the federal government that these two major airlines truly does not need a merger creating the biggest carrier of the world since they seem to be doing absolutely fine on their own accounts. The Justice Department is all set to sue the merger stating that it would only lead to inflated consumer prices. A trial has been planned for next month, stated a tax lawyer.
This is the same Justice Department that allowed the IRS to target and harass political groups before the 2012 election and the same entity that sold guns to the Mexican mafia which has cost hundreds of Mexicans their lives.
A Sound Argument
However, officials of the U.S. Airways are of the opinion that large profits should not derail this deal. According to them, a merged airline can compete with Delta and United better, both of which have grown by means of mergers.
For the third quarter, the U.S. Airways Group Inc. stated that net income was $216 million or $1.04 per each share. That’s a 12% decline from $245 million when share prices were at $1.24. Excluding the cost of the proposed merger, U.S. Airways said that it would earn about $1.16 which was 4 cents higher than what analysts had predicted.