TEMPE, Ariz. (AP) — US Airways Group Inc. warned Wednesday it faces "significant challenges" and may not perform as expected.
US Airways was acquired by America West Holdings Corp. in September as part of its strategy to emerge from more than two years of Chapter 11 bankruptcy protection. The combined company retained the US Airways name.
While the acquisition will result in certain synergies and growth opportunities in the future, the company said its significant operating losses have not subsided and will likely continue into 2006.
US Airways had estimated that the combined company would see about $600 million in operating cost savings and revenue synergies. However, in a Securities and Exchange Commission filing late Tuesday, US Airways said it "cannot assure" the synergies will be realized.
"We may not perform as well financially as we expect following the merger," the company cautioned.
The integration of the two air carriers "will be costly, complex and time consuming," US Airways said, and management "will have to devote substantial effort to such integration that could otherwise be spent on operational matters or other strategic opportunities."