US Airways on Wednesday reported a first-quarter loss, excluding items, as fuel costs rose, but said passenger demand was strong as the summer travel season approaches.

Net income came to USD$ 48 million, or 28 cents a share, in the quarter, compared with a loss of USD$ 114 million, or 71 cents a share, a year earlier.

Excluding a gain tied to an exchange of slots at two airports with Delta Air Lines, US Airways said its loss was 13 cents a share.

Quarterly revenue rose 10 percent to USD$ 3.3 billion.

Operating expenses rose about 7 percent, with costs for fuel and related taxes up 17 percent.

As US airlines have consolidated in a bid to grow, US Airways is hoping to follow suit, disclosing last week that it garnered support from three unions at bankrupt American Airlines for a potential merger between the two companies.

Should a US Airways-American merger happen, it would create a carrier that rivals United and Delta in size and scope.