Continental Airlines narrows loss from year-ago figures…Spacehab cutting between 15 and 20 percent of its work force…Anadarko Petroleum to sell stake in west Texas fields to Apache Corporation…
Houston-based Continental Airlines said its fourth-quarter loss narrowed by 40 percent from last year’s quarter. The world’s fifth-largest airline credits strong fare pricing as helping to offset increased fuel and labor costs. The carrier posted a quarterly loss of $26 million. Excluding a $22 million charge related to lump-sum payments to retiring pilots, Continental reports its loss as $4 million. Total revenue grew 11 percent to $3.16 billion, driven by double-digit percentage growth in its international regions. Analysts surveyed by Thomson Financial were looking for a loss of 15 cents per share on revenue of $3.16 billion. Continental says quarterly operating income totaled $20 million–or $42 million dollars, excluding one-time charges. That’s the carrier’s largest fourth-quarter operating profit since 2000. Continental has explored the possibility of a merger with United Airlines.
The union representing pilots at American Airlines blasted management over future stock payments to executives. The Allied Pilots Association says the stock payments could rival or exceed the company’s profit for all of 2006–some $231 million. The payments are due in mid-April to about a thousand managers. The payments are tied to the stock performance of parent AMR Corporation, which has been improving since bottoming out in early 2003. The unions says the payments would be worth $218 million based on their stock. The company declined to estimate the payments, noting that the stock price could go up or down by April. Union president Ralph Hunter said the bonuses were insulting to workers who agreed to wage and benefit cuts in 2003. AMR Chairman and Chief Executive Gerard Arpey declined to be drawn into a debate over the payments. He simply said he was “disappointed by some of the rhetoric that comes out.”
Webster-based Spacehab is cutting between 15 and 20 percent of its work force in a restructuring move, according to the Houston Business Journal. The move is to cut overhead costs, streamline operations and improve efficiency. Spacehab says the cut affects about 36 positions from its current staff of 220, saving about $3.9 million annually. The reductions eliminate redundancies as the company’s support of NASA’s space shuttle program moves toward completion of its last contracted mission. All necessary staff required to successfully support International Space Station re-supply missions will remain.
Anadarko Petroleum said it’s agreed to sell its stake in 28 west Texas crude oil fields to Apache Corporation for $1 billion. The sale to Houston-based Apache is the latest debt-reduction move by Anadarko–which is headquartered in the Houston suburb of The Woodlands. The bulk of the $22.5 billion debt stems from Anadarko’s acquisition last year of Kerr-McGee and Western Gas Resources. The Permian Basin fields are expected to produce about 12,000 barrels of oil equivalent per day from about 3,950 wells on 143,000 net acres. Anadarko operates roughly 90 percent of the properties. Earlier this week, Anadarko agreed to sell its interests in certain Wyoming oil fields to crude oil and natural gas producer Encore Acquisition Company for $400 million. Last month, the company agreed to sell two Louisiana oil fields to Exco Resources for $1.6 billion.
The House has overwhelmingly approved a bill to cut the interest rate on need-based student loans in half. The vote was 356-to-71 to slash the interest rate from 6.8 percent to 3.4 percent by 2011. The bill would affect about 5.5 million students who receive subsidized loans every year. But the bill isn’t as broad a measure as Democrats promised during the fall campaign. They’re now conceding they will have to do more to make college more affordable. Many Republicans said more federal grants would do a better job of helping the poor deal with the rising cost of college. The bill faces an uncertain future. The Bush administration opposes it and Senate Democrats plan to bring up a more comprehensive bill that could complicate its prospects.