Texas Air on Friday reported a net loss of $114.1 million for the third quarter of this year, compared to a loss of $72.8 million in the same period of 1987.
Revenue in the third quarter, which ended Sept. 30, dropped to $2.128 billion this year from $2.192 billion last year.
Texas Air, the Houston-based parent of troubled Eastern Airlines and of Continental Airlines, reported that profit from operations for the quarter fell to $7.8 million from an operating profit of $65.3 million reported for the same period in 1987.
Eastern had a net loss of $112.9 million in the third quarter of this year, the company said, compared to a net loss of $67.4 million in the period last year.
Eastern’s results, the company said, reflect its labor situation as well as “severe competitive pressures” on revenues. The airline is involved in a prolonged battle with its unions.
Despite the problems, the company said, “Eastern also is showing marked operational improvement, as indicated by Department of Transportation statistics, which is a tribute to the outstanding performance of Eastern’s employees during this difficult period.”
Continental, the company said, had an operating profit of $84.1 million and a net profit of $15.2 million on revenue of $1.2 billion in the 1988 third quarter. This compares to an operating profit of $52.8 million and a net loss of $10.2 million on revenue of $1.1 billion in the third quarter of last year.
‘Looking for Big Losses’
“Continental’s modest profit signals that financial progress continues to be made at the company,” Texas Air said in a prepared statement. “However, in view of the fact that the quarter is traditionally one of the company’s strongest, the results are clearly unsatisfactory.”
“We were looking for big losses,” said Paul Karos, airline analyst with the New York brokerage firm First Boston Corp. But “we were looking for a loss of $80 million, and they came in at $114 million.”
However, Karos said that despite the huge deficits, Texas Air is not in danger of running out of cash. He pointed to the pending sale of the Eastern’s New York-Washington-Boston air shuttle operation to financier Donald J. Trump for $365 million. “With this, the analyst said, “they will have $900 million in cash. That can last a long time.”