US Airways says U.S. budget cuts hurt March revenue

Wed Apr 3, 2013 9:54am EDT

* Carrier says sequester reduced last-minute demand

* Delta also cited effects of budget cuts

* US Airways shares down 0.4 pct

April 3 (Reuters) - US Airways Group said on Wednesday that federal budget cuts likely hurt a key revenue measure in March because of reduced last-minute demand for flights.

The carrier said unit revenue, a measure of pricing power and how full planes are, was flat in the month compared with a year earlier. US Airways added that result was lower than expected for March, and cited "reduced close-in demand believed to be driven largely by the sequester."

On Tuesday, Delta Air Lines cut its first-quarter forecast for unit revenue, which is also known as passenger revenue per available seat mile.

Delta had also said March unit revenue fell short of its expectations, citing lower-than-expected bookings due to automatic budget cuts mandated by sequestration and reduced demand as a result of attempts to raise prices.

US Airways, which plans to merge with AMR Corp's American Airlines to create the world's biggest carrier, said consolidated traffic rose 5.2 percent in March as the number of passengers boarded rose 4.1 percent.

Load factor, or the percentage of seats filled, improved to 85.6 percent from 84 percent a year earlier.

Shares of US Airways were down 0.4 percent to $15.67 in morning trading.

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