Western Airlines Reports Record 1st-Quarter Profit

Fueled by union pay and productivity concessions, Western Airlines on Monday reported record first-quarter profits even after setting aside 20% of its pretax earnings in a new profit-sharing plan.

“These results are positive proof that the Western strategy is working,” Chief Executive Gerald Grinstein said. “We have better control of costs and a route structure and marketing program that support our position as the dominant airline in the West.”

For the three months ended March 31, Western had net income of $13.3 million, compared to a $23-million loss a year earlier.

Its previous record first period--traditionally Western’s weakest quarter--was in 1979, when it earned $12.7 million.

Operating revenue in the most recent quarter rose about 5% to $268 million from $255.9 million a year earlier.

Grinstein attributed the airline’s $36.3-million turnaround to worker concessions and brisker business.

Last September, Western’s five labor unions approved new contracts that made permanent a previous 10% wage cut, plus granted an additional 12.5% pay reduction and productivity changes designed to save the company another 8% in payroll costs.