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CO - $206 Million Fourth Quarter Net Loss  
User currently offlineCAL From United States of America, joined Mar 2004, 499 posts, RR: 9
Posted (9 years 7 months 5 days 9 hours ago) and read 3768 times:

Continental Airlines reports $206 million fourth quarter net loss; $363 million net loss for the year.

HOUSTON, Jan. 20, 2005 -- Continental Airlines (NYSE: CAL) today reported a fourth quarter 2004 net loss of $206 million ($3.12 diluted loss per share). The net loss includes special items of $32 million ($14 million primarily due to the retirement of aircraft and $18 million related to a change in expected future costs for frequent flyer reward redemptions on alliance carriers). Excluding the special items, Continental recorded a net loss of $174 million ($2.62 diluted loss per share) for the quarter, which compares favorably to the First Call mean estimate of $3.29 loss per share.
For the full year 2004, Continental incurred a net loss of $363 million ($5.55 diluted loss per share) compared to net income of $38 million in 2003. The company’s 2004 results were adversely impacted by weak domestic yields and record breaking fuel prices. Excluding special items, Continental recorded a net loss of $255 million for 2004 ($3.91 diluted loss per share), compared to a net loss of $209 million ($3.20 diluted loss per share) in 2003.

[Edited 2005-01-20 15:01:14]


CAL........Continental Airlines....... Work Hard, Fly Right
31 replies: All unread, showing first 25:
 
User currently offlineCAL From United States of America, joined Mar 2004, 499 posts, RR: 9
Reply 1, posted (9 years 7 months 5 days 9 hours ago) and read 3758 times:

Continental Airlines, Inc. will announce Fourth Quarter 2004 Earnings on Thursday January 20, 2005. A live audio webcast of Continental's quarterly briefing for investors will be held at 10:30 a.m. Eastern Daylight Time. The speakers will include:

Larry Kellner, Chairman & CEO
Jeff Smisek, President
Jeff Misner, Executive Vice President & CFO

See it here:

http://www.continental.com/company/investor/audio.asp

[Edited 2005-01-20 14:58:14]


CAL........Continental Airlines....... Work Hard, Fly Right
User currently offlineFlyabunch From United States of America, joined Nov 2004, 517 posts, RR: 4
Reply 2, posted (9 years 7 months 5 days 9 hours ago) and read 3749 times:

Weak domestic yields? I flew on over 80 Continental flights in 2004 and I never saw a plane with more than a few empty seats. I think that at on at least 30 of the flights I was on they had to ask for people to take a later flight. And, I would say that more that 75% of the flights were full up.

I still think that Continental does a great job and will be among the survivors. I also think that without the fuel price run up they would have been profitable.

I wonder where those low yield flights go?

Mike


User currently offlineFlyPNS1 From United States of America, joined Nov 1999, 6603 posts, RR: 24
Reply 3, posted (9 years 7 months 5 days 9 hours ago) and read 3732 times:

Full flights don't mean strong yields. How do you know the plane wasn't filled with people who bought $99 transcon tickets? Or $49 EWR-Florida tickets?

If full flights determined profitability, WN would probably be the least profitable airline among the majors since WN usually has lower loadfactors.


User currently offlineFlyabunch From United States of America, joined Nov 2004, 517 posts, RR: 4
Reply 4, posted (9 years 7 months 5 days 9 hours ago) and read 3690 times:

FlyPNS1,

Sorry, confusing yields with loads. You are right, I have to say that most of my tickets were cheaper than they should be too. I would like to see a modest increase by all and then we could quit worrying about these losses. From my own cursory review it doesn't look like it would take much more per ticket to turn this all around.

Mike


User currently offlineFalcon84 From , joined Dec 1969, posts, RR:
Reply 5, posted (9 years 7 months 5 days 6 hours ago) and read 3567 times:

Still waiting to hear from our erstwhile pilots, who say CO is still in great financial shape....ahem.

User currently offlineEwr757 From United States of America, joined Apr 2000, 360 posts, RR: 8
Reply 6, posted (9 years 7 months 5 days 5 hours ago) and read 3510 times:

>>Still waiting to hear from our erstwhile pilots, who say CO is still in great financial shape....ahem.<<

Still waiting for you to back up your foolish claims on the other thread.

While you're at it, point out where anyone said anything about the financial shape of the company vis a vis not taking concessions.


User currently offlineEA CO AS From United States of America, joined Nov 2001, 13548 posts, RR: 62
Reply 7, posted (9 years 7 months 5 days 5 hours ago) and read 3465 times:
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From my own cursory review it doesn't look like it would take much more per ticket to turn this all around.

The problem, unfortunately, is that as long as even one carrier undercuts you by as little as $5.00, the public will take their business there instead - and since airline CEOs are fixated on market share instead of actual money coming in the door, the insane desire to maintain market share means they'll slash fares to not let a competitor gain ground on them.

I can't say I understand this behavior - I believe there's no point in maintaining a good market share in a certain city pair if you're losing money while doing so. I'd much rather have just 10% of a profitable market than 18% of a losing one!

Unfortunately, as long as the execs continue to value "market share" as one of their gauges of success, airlines will continue to lose money.



"In this present crisis, government is not the solution to our problem - government IS the problem." - Ronald Reagan
User currently offlineMariner From New Zealand, joined Nov 2001, 25080 posts, RR: 85
Reply 8, posted (9 years 7 months 5 days 4 hours ago) and read 3439 times:
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EA_CO_AS:

That's two of us who don't believe market share is the true measure of airline business.

Now, if we could just get a few CEO's to believe it as well...  Smile/happy/getting dizzy

cheers

mariner



aeternum nauta
User currently offlineEwr757 From United States of America, joined Apr 2000, 360 posts, RR: 8
Reply 9, posted (9 years 7 months 5 days 4 hours ago) and read 3430 times:

>>Unfortunately, as long as the execs continue to value "market share" as one of their gauges of success, airlines will continue to lose money. <<


Or stock price.


User currently offline727LOVER From United States of America, joined Oct 2001, 6422 posts, RR: 17
Reply 10, posted (9 years 7 months 5 days 4 hours ago) and read 3427 times:

CO had a yearly profit in 2003? I know they had gov. aid in the 2nd quarter, but that offset a yearly loss?  Confused


Listen Betty, don't start up with your 'White Zone' s*** again.
User currently offlineAirbazar From United States of America, joined Sep 2003, 8287 posts, RR: 10
Reply 11, posted (9 years 7 months 5 days 4 hours ago) and read 3365 times:

EA_CO_AS, that's 3 of us  Smile
They can take their market share all the way to the their grave. Say goodbye to CO's 7E7's.


User currently offlineKL662 From United States of America, joined Jan 2005, 121 posts, RR: 0
Reply 12, posted (9 years 7 months 5 days 3 hours ago) and read 3331 times:

Haven't past airlines (that are no longer around) tried shrinking to profitability?

User currently offlineCO2BGR From United States of America, joined Oct 2003, 558 posts, RR: 4
Reply 13, posted (9 years 7 months 5 days 3 hours ago) and read 3296 times:

So they loose $255 mil for the year, then ask for $500mil in concessions, 40% from the pilots alone (200 mil).....I dont think so.....This is one more reason that the pilots wont vote for $200mil/year in concessions.


There are too many self indulgent weiners in this town with too much bloody money" Randal Raines- Gone in 60 Seconds
User currently offlineEA CO AS From United States of America, joined Nov 2001, 13548 posts, RR: 62
Reply 14, posted (9 years 7 months 5 days 2 hours ago) and read 3252 times:
Support Airliners.net - become a First Class Member!

Or stock price.

Very true.

I can understand the BOD giving incentives based on stock performance, but not when doing so encourages CEOs to artificially manipulate stock prices to hit various targets preordained by the board. Decisions need to be based on the long-term viability of the business and not based on short-term stock performance.

Take care of your employees, and take care of them well. In turn, they'll take excellent care of your customers.

Ultimately, your customers will take care of your business - and your stock price in the process.

CEOs sometimes let their fiduciary responsibility to the shareholders cloud their vision and judgment.



"In this present crisis, government is not the solution to our problem - government IS the problem." - Ronald Reagan
User currently offlineSlider From United States of America, joined Feb 2004, 6793 posts, RR: 34
Reply 15, posted (9 years 7 months 5 days 2 hours ago) and read 3224 times:

So they loose $255 mil for the year, then ask for $500mil in concessions, 40% from the pilots alone (200 mil).....I dont think so.....This is one more reason that the pilots wont vote for $200mil/year in concessions.

That's a misguided analysis entirely.

And that's exactly why the company has done briefings with EVERY employee in the company on the actual financials of CO.

In 2004, we had an operating loss. About the same projected for 2005 given a yield degradation and high fuel prices.

So if there isn't an operating gain, and you have a $230 incremental fixed cost YOY increase in 2005 to $648M, and a $230M hit for pension funding brings a total of $900M or so, almost a billion, in planned expenses for 2005.

Now assume our present $1.4B of cash on hand, and it doesn't take a rocket scientist to realize that even after CO has undertaken cost savings measures and controlled CASM as much as possible, you need labor to chip in too in order to maintain a sound cash balance.

Without it, we're screwed and it means shrinking, not growing.

And dipping below a certain cash balance triggers deb covenants which result in HIGHER cost of the debt already on the books. Self-fulfilling prophecy as it were.

The reason we're doing this now is so that we don't HAVE to face a last hour desperation move after losing money like the rest of the legacy carriers.


User currently offlineFalcon84 From , joined Dec 1969, posts, RR:
Reply 16, posted (9 years 7 months 4 days 20 hours ago) and read 3126 times:

Slider, you need to save the argument. The pilots apparently can fly, but can't do basic math. To them, losing money head over heals isn't a reason for THEM to give up some pay. They'd rather see the company go belly up, then to admit they were wrong.

User currently offlineMoPac From United States of America, joined Sep 2003, 215 posts, RR: 0
Reply 17, posted (9 years 7 months 4 days 19 hours ago) and read 3081 times:

I'm surprised no one has mentioned this yet, but one of the Jeff's noted that while CO lost $200 million for the year they paid out over a billion to the Federal Government! The 1 billion is from what I understand just the federal taxes... not including the state/local/airport use taxes.

I've heard Gordon bitching about the taxes in previous calls ("Hell, we're taxed somewhere between booze and smokes") but I had absolutely no idea they coughed out a billion to the federal government while taking a $200 million loss. In one of the earlier '04 earnings calls I thought Gordon was being a smart a$$ when he said "oh yeah, Congress loves to talk about the $5 billion loan packages, but what they don't like talking about is the fact that the indus-tree (Gordo) paid out over $8 Billion (IIRC) to the federal government in taxes this year alone".

I have a hard time imagining that it cost a billion for the gov to administer CO's ops... maybe it did... but that's still a lot of 0's.

Oh, and why the hell doesn't gen av (especially turbine operators) contribute? At least to the administration of ATC???


User currently offlineExpressjetphx From , joined Dec 1969, posts, RR:
Reply 18, posted (9 years 7 months 4 days 19 hours ago) and read 3056 times:

that sucks...and here i thought CO was making money all this time

User currently offlineEwr757 From United States of America, joined Apr 2000, 360 posts, RR: 8
Reply 19, posted (9 years 7 months 4 days 12 hours ago) and read 2973 times:

>>Slider, you need to save the argument. The pilots apparently can fly, but can't do basic math.<<

Basic math? Like your inability to do basic math when execs. take a raise, then announce a paycut and the new scale is still in excess of their old salary? Or the salary of their predecessor? Shall I repost the figures for you?


>>To them, losing money head over heals isn't a reason for THEM to give up some pay.<<

Let's see Mr. Agent man. On an industry standard pay scale, how is your comparitive pay? The labor CASM at CO is what compared to the industry?
Your contract is how old? Was amendable when? Yes, that is right, you have no contract, nor are you a pilot. It is humorous how you complain about our issues. Not to mention how you attempt to sound and act like you're an expert on the factors facing the pilots and the reasons for their stance with management.

>>They'd rather see the company go belly up, then to admit they were wrong. <<

Is this like you not admitting you post complete lies and misinformation on this board about unions, company meetings and other information? Shall I bring the particular post back up? Obviously you can not back up your information since it doesn't exist.

Perhaps that is a benefit of your "first class" membership?

[Edited 2005-01-21 12:04:51]

User currently offlineEwr757 From United States of America, joined Apr 2000, 360 posts, RR: 8
Reply 20, posted (9 years 7 months 4 days 12 hours ago) and read 2971 times:

>>I can understand the BOD giving incentives based on stock performance, but not when doing so encourages CEOs to artificially manipulate stock prices to hit various targets preordained by the board. Decisions need to be based on the long-term viability of the business and not based on short-term stock performance.<<


EA:

The above is a lesson lost on Wall Street, Business Schools and top management all over this country.

Your post is so accurate it should be required reading everywhere.

MO PAC

>>they paid out over a billion to the Federal Government<<

I believe that figure was reference security fees and taxes alone. Not to worry though, people like Falcon84 feel it is ok to fund that out of the employees pockets.

However, you're are correct. It is absurd.



[Edited 2005-01-21 12:02:54]

User currently offlineWhiskeyhotel From United States of America, joined Aug 2004, 274 posts, RR: 0
Reply 21, posted (9 years 7 months 4 days 9 hours ago) and read 2900 times:

It's a shame to see infighting in the CO camp. I hope labour and management can come to a solution that meets both parties' needs whilst keeping the airline afloat. I remember flying on CO in the early 90's, when flying on the proud bird with the golden tail kinda felt like being strapped to a duck's back during hunting season -- a sense of doom and gloom was rampant, as no one expected CO to successfully exit bankruptcy. It was not a pleasant time to be a CO fan. I wish CO and its employees all the best through this time of horrendous oil prices and absurdly low ticket prices (I fly mostly transatlantic though, mostly on B fares or higher...so I'd like to think I contribute to the bottom line inching towards the black). However, as a consumer who flies 100K+ miles/year, I must say that if labour disputes begin to affect customer service, I, like many other customers, will vote with my feet and choose one of the many other airlines out there that flies across the pond.

User currently offlineFalcon84 From , joined Dec 1969, posts, RR:
Reply 22, posted (9 years 7 months 4 days 7 hours ago) and read 2836 times:

Whiskeyhotel, I think you'll find that the the unions, despite the lack of rreality shown by ewr757, will make an agreement with the company.

I work for field services, we're non-union. Management came to us, told us how much our share of the $500 million wage concessions would be. Then our employee reps, and many employee themselves, gave suggestions to management about work rule changes that could be implimented to help cut down the amout of actual base pay tha would be taken from us. Our reps talked with management at least 4 or 5 times about these proposals, and worked very closely with them to impliment somethng that would be as painless as possible.

Well, on tuesday, CO announced that it had finalized the $99 million package that field services will be given. The press release said there were work rule changes that would minimize the actual pay cuts. I'm on vacation this week, so I haven't been privy to any info coming out of work. I would imagine that I'll get a letter telling me exactly what my compensation is, as that protect my privace a little more in this process.

I imagine, although I cannot speak for the unions, that their union leadership is doing much the same: looking at work rule changes that would lessen the impact of off-the-top paycuts. And, I think you'll find, that despite the lack of reality on the part of people like ewr757, and their refusal to realize what's going on in the industry, that the unions will make an agreement.

If they don't, they're cutting their own throats in the long run. I think you'll see them adjust to the new reality, and go forward from there. Like me, they may not like it, but they'll go along with it, in the earnest hopes that these wage concession will help CO return to profitability.


User currently offlineFalcon84 From , joined Dec 1969, posts, RR:
Reply 23, posted (9 years 7 months 4 days 5 hours ago) and read 2738 times:

OK Falcon...How is this?

Much better. I thank you for realizing the uncivility of how you started the original one.

Lack of reality or your one sided opinion?

Not at all-on yours. You keep hitting management for bonuses that, in the long run, add up to peanuts as compared to overall finances in the company. I've ticked off to you, time and time again, the reality of this industry-realities that you seemingly ignore and dismiss out of hand:

-the dramatic rise in gas prices. Every time gas goes up $1 a barrel, it costs the company like $138 million.

-the continued decrease in ticket prices. Prices, adjusted for inflation, are where they were the year deregulation started, in 1978.

-the fact we pay over $1 billion a year in taxes to Uncle Sam.

-the fact that high-yield business travelers are staying away from the industry, and show no signs of coming back.

-the fact we have $1 billion in obligations this year in loan interest payments and in pension contributions.

Those are fact. They add up far more, and affect this company far more than the $49 million in bonuses you keep harping on. I don't consider that "one-sided opinion". I consider that reality. Why do you ignore these things?

Speaking of reality....are you ready to back up your blatent lies and mischaracterizations of past meetings?

If you're talking about the meetings we've had with management, you're the one who says they're blatant lies and mischaractizations, even though you weren't present, which I fine pretty amazing. You don't have a clue what went on there, so how can you, with a straight face, make such sweeping claims?

I do have a question for you. With Larry and Jeff hitting the road to the major stations, are pilots even allowed to go to their road shows, or does the union not permit you to attend these session? I wasn't able to attend the one here in CLE because it was too early in the day, and I had to get my kids off to school. But are you even allowed to go?

Why stop now? This hasn't stopped you from spewing your incorrect assumptions and statements before.

It wasn't an incorrect assumption, as far as I'm concerned. Are you telling me your union ISN'T doing the same? If they aren't, that's the height of irresponsibility on the part of your union. I cannot answer that. You can-why don't you? Is your union looking at work rule changes to offset the pay cuts? It's not a hard question, and I am just curious. To me, it makes sense for them to do so.

I realize that I will not fund their future out of my pay.

Actually, you will, in one way or another. Whether you like it or not, you will end up giving something back to help this company make it in the long run. It's a reality, whether you give up less now, or you give up more in a bankruptcy filing, when all bets are off. The reality is, you will give it up. I wish it wasn't the case, and I do not like the fact either of us has to give up anything, but again, your denial of the facts won't change the reality tha will happen sooner or later. For all involved, sooner is better.



User currently offlineEwr757 From United States of America, joined Apr 2000, 360 posts, RR: 8
Reply 24, posted (9 years 7 months 4 days 1 hour ago) and read 2665 times:



>>Much better. I thank you for realizing the uncivility of how you started the original one.<<

Such a thin skinned person. Hypocritical as well if you’re talking about “civility”

From one of your earlier posts:

>>http://www.airliners.net/discussions/general_aviation/read.main/1900742/6/

you seem to want to follow in their example of fucking over everyone else for your own short-term benefit.<<

I guess civility only counts when you want to use it.

>>Not at all-on yours. You keep hitting management for bonuses that, in the long run, add up to peanuts as compared to overall finances in the company. <<

Peanuts? You call $49 million to 16 people peanuts? I’m sorry pal, but when you’re asking for pay cuts from the rank and file, you don’t reach into their pockets at the same time. There is a thing called leadership by example.

>>I've ticked off to you, time and time again, the reality of this industry-realities that you seemingly ignore and dismiss out of hand:<<

All you are doing is sounding like a parrot in a pet shop. Everything you speak of is a cost of doing business. Attacking an already low labor CASM does nothing to solve the long term problems. Unless the real problems are addressed like the peanuts for executive compensation for example, the problems do not go away. Labor cuts are a short term approach that in the end solves nothing. Given your example of say fuel..has management said they would refund the difference if it goes down? What if it goes up again? Are you willing to continue to subsidize costs of doing business?


>>If you're talking about the meetings we've had with management, you're the one who says they're blatant lies and mischaractizations, even though you weren't present, which I fine pretty amazing. You don't have a clue what went on there, so how can you, with a straight face, make such sweeping claims? <<

No, I am talking about your blantent lies about the meeting.

>>http://www.airliners.net/discussions/general_aviation/read.main/1900742/6/<<
From this post again you wrote:

>>your union doesn't allow you to talk directly to management<<

Back up your claim. You can't because it is a complete lie.

>>Last time I checked, we were employees. Should I have said "gate and ramp"? Would that have made you happy. The fact you weren't invited<<

Names, date, management people in attendance who stated this.

>>I do have a question for you. With Larry and Jeff hitting the road to the major stations, are pilots even allowed to go to their road shows, or does the union not permit you to attend these session?<<

Now that is interesting given your statement from before and above. Do you see a bit of a your continued contradictions?

>>I wasn't able to attend the one here in CLE because it was too early in the day, and I had to get my kids off to school. But are you even allowed to go?<<

Yes. I take it that is the extent of your retraction from your earlier comments?

>>It wasn't an incorrect assumption, as far as I'm concerned. Are you telling me your union ISN'T doing the same? If they aren't, that's the height of irresponsibility on the part of your union. I cannot answer that. You can-why don't you? Is your union looking at work rule changes to offset the pay cuts? It's not a hard question, and I am just curious. To me, it makes sense for them to do so.<<

The union is classifying any give backs as a loan. Any concessions will be tied to a significant upside pay back for the pilots. I will not put specifics on the internet, but so far, what has been talked about has not been recieved well.


>>Actually, you will, in one way or another. Whether you like it or not, you will end up giving something back to help this company make it in the long run. It's a reality, whether you give up less now, or you give up more in a bankruptcy filing, when all bets are off. The reality is, you will give it up. I wish it wasn't the case, and I do not like the fact either of us has to give up anything, but again, your denial of the facts won't change the reality tha will happen sooner or later. For all involved, sooner is better.<<

I believe if things do not change within the industry (exclusive of labor CASM), the company will file bankruptcy anyway. No amount of concessions will fix the industry or CO’s problems. Further, any concessions will be voted on by the pilot group. At this point, I doubt it would pass. You are dealing with a pilot group that has not had raises in a significant amount of time, has already been earning far less than their peers and has a contract that is 29 months past it's amendable date.


25 Post contains images Falcon84 : Such a thin skinned person. Hypocritical as well if you’re talking about “civility” If you want to call me "think skinned" because you started a
26 Ewr757 : >> you want to call me "think skinned" because you started a post saying to me "hello liar", then so be it. I thought, and the mods obviously agreed,
27 Post contains images Falcon84 : But you are a liar and I proved it. ROTFL. How did you prove it? Becuase I went to a local meeting with management, and not the one with Kellner? That
28 Ewr757 : >>I never worked at EA. Go back and read my post when I brought up EA. I said I cut my teeth at CO when EA was picketing our ticket counters, threaten
29 Post contains images Falcon84 : >>We saw it at EA
30 Lightsaber : Question: Does anyone know how much CO paid their executives in 2002, 2003, and 2004? I'm talking salaries, stock options, and other compensation ABOV
31 WesternA318 : *sigh* you two are still at it? Good lord, this remids me of the Lorenzo/Bryan fights of yore. Get over it EWR, Falcon is just getting his point of vi
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