Aloha ended May up $2.5 million
By Rick Daysog
Benefiting from its recent cost-cutting efforts, Aloha Airlines Inc. posted a $2.5 million operating profit in May.
Aloha, which filed for bankruptcy reorganization in December, reversed a $3.8 million operating loss in April and lowered its year-to-date losses to $4.7 million from $7.2 million in April, according to a bankruptcy court filing made public yesterday.
The May results came on revenues of $38.5 million, which was up $3.5 million from April's $35 million.
"These numbers indicate that Aloha's reorganization plan is on course," said company spokes-man Stu Glauberman.
In its latest filing, Aloha said its overall expenses dropped to about $36 million in May from the previous month's $38.8 million.
The privately held airline said its monthly fuel costs dropped to about $9 million from April's $9.4 million while its salary expenses for management and rank-and-file employees fell to $5.6 million from about $8.4 million in the previous month.
The lower payroll figures include a recent 20 percent cut in executive salaries and wage concessions from its unionized employees.
One union, the pilots, said it agreed to concessions of up to $12 million over the next two years. Those cuts were on top of another $12 million in concession that the union granted from 2003 to 2005.
Meanwhile, the annual pay for top executives dropped to a range of $123,000 to $202,500 from a range of $151,000 to $250,000.
According to its filing in bankruptcy court, Aloha's reorganization costs swelled last month. Aloha's 30 law firms, accountants and consulting firms have charged the airline about $3.3 million in May, which was up from $2 million in April. The reorganization costs are not included in the monthly profit-loss statement.
Since filing for bankruptcy, the airline has paid nearly $6.3 million in attorney and professional fees, including $1.1 million to its top bankruptcy law firm, Florida-based Berger Singerman.
The May turnaround comes at a critical period for Aloha, the state's second-largest airline with more than 3,600 employees and annual revenues of about $400 million.
The airline, which obtained $65 million in debtor-in-possession financing in March to cover daily operations and pay down debt, is seeking permanent financing or an equity investment that would allow it to emerge from bankruptcy protection.
Advertiser Staff Writer