USAir Group Inc. yesterday reported substantially higher profit and revenue for 1987, reflecting its acquisition during the year of Pacific Southwest and Piedmont airlines.
The Washington-based airline said it earned $194.6 million ($5.27 a share) during 1987, about double the $98.4 million ($3.33) it earned in 1986. Revenue increased to $3 billion during the year from $1.8 billion in 1986.
The year-end report included results from Pacific Southwest Airlines from May 29, when USAir acquired the West Coast carrier, and results from Piedmont Aviation Inc. from Nov. 4, when USAir acquired that company. The results also included a portion of Piedmont's earnings from March 8, 1987, to Nov. 4. During that time USAir held a 51 percent equity position in Piedmont pending approval of the merger of the two carriers by the Department of Transportation.
Operating income for 1987 was $319.2 million, compared with operating income of $169.4 million in 1986.
In the fourth quarter of 1987, USAir Group's net income fell to $26.7 million (62 cents) from $32.1 million ($1.06) for the same period a year earlier. During the quarter the airline holding company had a $35.9 million interest expense related to its acquisition costs. Revenue, however, rose to $1.1 billion from $483.4 million in the same quarter a year earlier. Geico Corp. said its profit fell 18 percent in 1987, primarily because of stock market losses on investments by the Washington-based insurance company.
The company said it earned $177.9 million ($10.67) during the year, compared with $217.7 million ($12.61) in 1986. Geico said that it had net realized gains on investments of $53.2 million through the first nine months of the year, but that the stock collapse in October led to a $25.5 million loss on investments in the fourth quarter. That brought the net realized gain for the year to $27.7 million, compared with a gain of $98.5 million in 1986.
"We invest for total return over the long run, but cannot plan what the markets will do each year," Geico Chairman William Snyder said in a statement.
In the fourth quarter, Geico earned $12.7 million (77 cents), down from $67.3 million ($4) for the same period a year earlier, with virtually all the difference attributed to changes in the value of the company's investments.