BAX GLOBAL’s LOSSES CONTINUE DESPITE COST-CUTTING

BAX GLOBALÆS LOSSES CONTINUE DESPITE COST-CUTTING    BAX Global, the integrated air freight subsidiary of The Pittston Co., reported a third-quarter operating loss of $12.7 million, due to softer demand and higher spending in its domestic operations.
   BAX Global reported $18.2 million in earnings in the third quarter of 1999.
   Revenue declined 2 percent to $521 million.
   Domestic volumes declined 10 percent, due to softer-than-expected demand, combined with increasing operating costs. The higher service costs reflected additional expenditures for aircraft, higher infrastructure costs and increases in fuel costs, which were not fully covered by fuel surcharges. BAX reported an operating loss of $12.1 million for its domestic business, compared to an operating profit of $21.5 million in the year earlier quarter. Operating revenue for the Americas declined 4 percent, to $306 million.
   'The financial performance of our BAX Global unit during the quarter continued to be disappointing,' said Michael T. Dan, president and chief executive officer of The Pittston Co. However, 'management has taken steps to remove costs which were not essential to the domestic operations.'
   Those actions including reducing station operating expenses, sales costs and corporate overhead. BAX also removed five planes from its U.S. fleet of 43 freighters.
   Operating income for BAX Global's international business rose 7.8 percent to $8.2 million. Revenue from worldwide expedited freight services declined 2.9 percent to $435.2 million.
   BAX operates a fleet of aircraft in the United States, but acts as a forwarder in international markets.
   For the January-September period, BAX Global reported an operating loss of $29.1 million, compared to an operating profit of $31.4 million for the year-earlier period. Operating revenue improved 4.3 percent to $1.55 billion.