NEW YORK (AP) - US Airways Group Inc. expects ticket prices and passenger demand will continue their upward climb this year, overshadowing stubbornly higher fuel prices.
It's just the continuation of a "transformation" to a more stable industry where fare sales are less common, tickets are more expensive and rapid addition of flights is rare, says CEO Doug Parker.
Investors applauded the comments Wednesday and brushed off a decline in the company's fourth-quarter earnings. The earnings still topped Wall Street expectations and its stock jumped more than 20 percent in afternoon trading.
The airline also confirmed that it hired advisers to study a possible combination with American Airlines. Though Parker, a long proponent of industry consolidation, said it will likely be some time before any decision is made.
American's parent AMR Corp. filed for bankruptcy protection in November. In bankruptcy, AMR could shed billions in debt, reduce its costs and still afford new planes - a combination that has drawn plenty of attention. Rival carrier Delta and a private equity firm are also reportedly studying a bid.
A big fuel bill lowered US Airways' earnings by 35 percent in the final three months of 2011.
The Tempe, Ariz., company reported net income of $18 million, or 11 cents per share, in the fourth quarter. That compares with $28 million, or 17 cents per share, a year earlier. Excluding charges, it earned 13 cents per share. Analysts surveyed by FactSet had expected earnings of 2 cents per share and typically exclude one-time items from their estimates.
Revenue climbed 9 percent to $3.16 billion. The money the airline made to fly a passenger one mile in the fourth-quarter rose 10 percent to a record 15.2 cents, as it raised fares to offset a $232 million increase in fuel costs.