
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: TUESDAY, April 10, 1990                   TAG: 9004100245
SECTION: BUSINESS                    PAGE: A7   EDITION: METRO 
SOURCE: 
DATELINE:                                 LENGTH: Short

USAIR'S CREDIT RATING DOWNGRADED BY S&P

Credit ratings for equipment trust certificates of USAir Group Inc. have been downgraded by Standard & Poor's to BBB, partly as the result of weak earnings arising from problems in the Piedmont Aviation merger. Other reasons for the downgrading are increasing debt and lease obligations to finance heavy capital expenditures, the company said.

USAir earnings are expected to recover from its loss of $180 million in the last half of 1989, Standard & Poor's said, and the Piedmont merger "should strengthen its market position over the long term."

USAir has begun to restore operating performance and control costs, the rating company said, but "a poor industry environment will probably defer any significant profit turnaround until next year." USAir's expected capital spending of more than $1 billion annually in the next several years "will add significant debt and lease obligations, limiting credit improvement even as earnings recover." - Staff report

by CNB