US AIRWAYS GROUP 3RD QUARTER NET LOSS IS $30 MILLION COMPARED TO $85 MILLION LOSS IN 3RD QUARTER OF 1999

ARLINGTON, Va., Oct. 18, 2000 -- US Airways Group, Inc., reported a net loss for the third quarter today of $30 million on revenues of $2.4 billion. Operating income for the quarter was $5 million. Diluted loss per common share was 45 cents.

"Our third quarter results are disappointing, reflecting very high fuel costs and increased competition on a significant number of routes. US Airways employees, however, are to be congratulated for a marked year-over-year improvement in our operational performance, especially at a time when we continue to bring a large number of new aircraft into the system," said US Airways President and CEO Rakesh Gangwal.

US Airways Chairman Stephen M. Wolf said: "We are continuing to work closely with the experts at the U.S. Department of Justice, U.S. Department of Transportation, the European Commission and the state attorneys general on their reviews of our merger with United Airlines, which we believe will bring vastly increased breadth of service to communities on the US Airways system."

US Airways Group’s operating income of $5 million compares to a loss of $111 million in the third quarter of 1999. Operating revenues for the quarter of $2.4 billion were an improvement of 13.3 percent over 1999 while operating expenses of $2.4 billion were 7.4 percent higher than the previous year. The net loss for the quarter of $30 million was an improvement of 64.7 percent over the net loss of $85 million in 1999. The diluted loss per common share of 45 cents compares to a loss of $1.19 in 1999.

Total revenue passenger miles for the quarter were up 19.7 percent over the third quarter of 1999 as available seat miles rose 17.2 percent. The load factor for the period was 72.9 percent, up by 1.5 percentage points over the third quarter of 1999. Revenue per available seat mile of 12.15 cents was 3.5 percent below that of 1999 while cost per available seat mile of 12.28 cents was lower by 9.5 percent. The cost of aviation fuel per gallon was 98.27 cents, an increase of 54.7 percent, while the number of gallons consumed increased 16.7 percent.

For the first nine months of 2000, operating income was $34 million, down 86.8 percent from 1999. Operating revenues of $6.9 billion were higher by 7.0 percent while operating expenses of $6.9 billion were higher by 10.9 percent, largely reflecting increased costs for fuel. The net loss for the first nine months of $168 million is 160.4 percent below the net income of $278 million for the comparable period of 1999, which includes a gain of $274 million related to the sale of the Company’s interest in Galileo International, Inc. The diluted loss per common share of $2.52 is 169 percent below the diluted earnings per share of $3.65 for 1999.

Total revenue passenger miles for the first nine months were up by 11.1 percent while total available seat miles increased 11.1 percent. The load factor for the period of 70.7 percent was unchanged from 1999. Revenue per available seat mile for the first three quarters of 2000 was 12.67 cents, down 4.2 percent, while cost per available seat mile of 12.75 cents was lower by 1.7 percent. Cost of aviation fuel per gallon was 91.04 cents, a 71.1 percent increase over 1999, while the number of gallons of fuel consumed increased by 9.6 percent.

US Airways will conduct its third quarter conference call this afternoon at 1 p.m. Interested parties are invited to listen to US Airways President and CEO Gangwal and other company senior officers as they discuss the earnings results with analysts from the investment community. The conference call will be held via a special webcast on US Airways’ website usairways.com at the following location: http://investor.usairways.com/medialist.cfm

The webcast will last approximately one hour. Interested parties should log on at least five minutes prior to the call in order to register. An archive of the conference call also will be available on the US Airways web site through Jan. 17, 2001.

To listen to the call, Real Player must be installed. Real Player can be downloaded through the US Airways website by following the instructions shown on the Presentations page (URL listed above). The download is free and should take approximately 10 minutes.

Reporters needing additional information should contact US Airways Corporate Communications at (703) 872-5100.

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