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ONLY THE WINDOWS stayed the same as the
Company's 14th Boeing 737 underwent a complete
re-configuration prior to being put into service
October 29. The 15th jet arrived the next day.
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SEPTEMBER/OCTOBER, 1972
VOL. XXIII, NO. 6
Third Quarter Sets Revenue Records
The Company recorded new highs in profits
and traffic during the third quarter, President
T. H. Davis reported to stockholders this week.
Net income for the third quarter was $1,798,-
563 or 81f per share. Combined with earnings
for the first six months, these figures result
in a net profit of $2,961,363 or $1.33 per share
for the year to date. This compares to a loss
of $202,153 in the first nine months of 1971.
The 1971 third quarter profit was $985,005 or
45f per share.
This improved earnings picture is due largely
to substantial increases in traffic. Passenger
totals for the third quarter of this year were
845,325, an increase of 10.3 per cent over the
same period in 1971. During the first nine
months of this year 2,364,323 passengers were
carried as compared to 2,130,805 during the
same period last year, an 11 per cent increase.
The passenger load factor rose from 50.28
per cent in the third quarter of 1971 to 52.74
per cent for the July, August, September period
this year. The increase for the nine months
was 6.1 per cent, from 47.49 per cent last year
to 50.38 per cent in 1972.
Total gross revenues for the third quarter
were $29,932,517. This is a 19% increase over
the same three months of last year when they
were $25,206,697. For the year to date
through September 30, total gross revenues
rose 16% from $72,233,284 in 1971 to
$83,646,065 in 1972. Most of the increases
were in passenger revenues which were
$2,454,714 and $7,913,991 more than last year
in the respective three-months and nine-months
periods. Approximately $5.7 million of the ad
ditional year-to-date passenger revenue was
caused by an 11% increase in revenue pas
senger miles flown and the balance was due
to passenger fare increases authorized by the
Civil Aeronautics Board effective May 7, 1971
and September 5, 1972.
Davis also told the stockholders that “Sales
by the Company’s General Aviation operations
have continued to gain at a very satisfactory
pace, reflecting a growth of 78% during the
third quarter over last year and a 28% increase
for the nine-months period. Pretax profits
rose from $89,134 in the third quarter of 1971
to $288,792 for the same period in 1972 and
the nine-months pretax profits showed a gain
of 86% from $408,470 last year to $758,224
this year. Most of these gains were derived
from the sale of aircraft. These sales are some
what sporadic and it is difficult to estimate the
volume of such sales for the remainder of the
year, but it is evident that the final results
from this operation in 1972 will be substantially
better than was experienced last year.
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“Operating expenses have continued to
climb rapidly, especially in the areas of em
ployee wages and benefits, rents, landing fees
and maintenance services, but savings in cer
tain other areas and a continued close monitor
ing of all costs have brought about some im
provement in the over-all rate of increases.
During the third quarter of 1972, we flew 4%
more plane miles than were flown in the same
period last year and we carried 10% more
passengers, but expenses increased only 7 %.
This compares to an 8% increase in expenses
during the third quarter of last year over
the preceding year in spite of the fact that we
flew 3% less plane miles in 1971 than in 1970.”
In his letter to the stockholders Davis noted
that the financing arrangements for the pur
chase of the two new 737’s have been completed
and that the first of the two will go into
service October 29 with the second one to be
delivered the next day.
“The CAB examiner who conducted the hear
ing on July 6, 1972 regarding our application
for transfer of a route between Louisville and
Washington to Piedmont from Eastern Air
Lines has decided in favor of the transfer to
Piedmont. His decision is subject to approval
by the members of the Board, however, and no
final decision has been reached as yet. We an
ticipate a final favorable order in the near
future.
“We are indeed gratified by the favorable
“turn-around” in the financial results achieved
thus far this year and your cooperation in
making this possible is greatly appreciated.
The fourth quarter of each year is generally
not as profitable as the summer periods be
cause of more adverse weather conditions,
but traffic is still continuing to show a nice
rate of growth and unless some severe unfore
seen development occurs, we will be able to re
port the most profitable year in the history
of our Company.”