Airlines Report Profit for Second Quarter

airplaneThe largest scheduled passenger airlines reported a 6.0 percent profit margin in the second quarter of 2012, up from 5.3 percent in the second quarter of 2011, the U.S. Department of Transportation's Bureau of Transportation Statistics (BTS) reported.

BTS reported that the nine largest airlines, based on passengers in the second quarter, achieved an operating profit margin - as a group - in each of the last five quarters. Together, BTS said, they posted a profit of $2.3 billion with all of the large carriers reporting an operating profit. These nine airlines carried 80.0 percent of U.S. airlines' scheduled service passengers in the second quarter of 2012. 

The top nine airlines reported $670 million in Net Income in the second quarter. Net Income and Operating Profit or Loss are two different measures of airline financial performance. Operating Profit or Loss is calculated from operating revenues and expenses. Net Income may include non-operating income and expenses, nonrecurring items or income taxes, BTS said.

As part of their second-quarter revenue, all U.S. passenger airlines collected a total of $931 million in baggage fees and $661 million from reservation change fees from April through June 2012. Fees would be included for calculations of Net Income and Operating Profit or Loss, BTS said.

Baggage fees and reservation change fees are the only ancillary fees paid by passengers that are reported to BTS as separate items, the agency notes. Other fees, such as revenue from seating assignments and on-board sales of food, beverages, pillows, blankets, and entertainment are combined in different categories and cannot be identified separately.

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