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United Posts 1st Quarter 2007 Loss  
User currently offlineSpoke2Spoke From United States of America, joined Oct 2004, 190 posts, RR: 0
Posted (7 years 4 months 3 weeks 4 days 3 hours ago) and read 4968 times:

First Quarter Loss of $152 million. Revenue was $4.4 billion vs. expected revenue of $4.6 billion.

Weather was bad plus fuel was expensive equals weak earnings.

http://biz.yahoo.com/ap/070425/earns_ual.html?.v=1

[Edited 2007-04-25 16:18:34]


...carelessness and overconfidence are usually far more dangerous than deliberately accepted risks. - Wilbur Wright
39 replies: All unread, showing first 25:
 
User currently offlineRL757PVD From United States of America, joined Dec 1999, 4674 posts, RR: 11
Reply 1, posted (7 years 4 months 3 weeks 4 days 3 hours ago) and read 4894 times:

That is a major dissapointment and clearly shows needs that more work needs to be done. and their top management got huge bonuses??????

Ever other airline has begun to turn the corner, there really is no excuse for a loss like that, esp after CH 11, if i was a creditor/stock holder id have some serious questions about what their plans are to turn a profit.



Experience is what you get when what you thought would work out didn't!
User currently offlineFriendlySkies From United States of America, joined Aug 2004, 4105 posts, RR: 5
Reply 2, posted (7 years 4 months 3 weeks 4 days 3 hours ago) and read 4843 times:

Sigh...alright.

Tilton and the boys got UA off the brink. Me thinks it's time to bring someone a bit more visionary in to turn UA into what it used to be...a popular airline making more money than they knew what to do with.

I'm a UA supporter, but there is no excuse for this kind of loss. Other airlines had to deal with weather and fuel too.


User currently offlineGeorgebush From New Zealand, joined Jul 2006, 679 posts, RR: 0
Reply 3, posted (7 years 4 months 3 weeks 4 days 2 hours ago) and read 4794 times:

Quoting RL757PVD (Reply 1):
That is a major dissapointment and clearly shows needs that more work needs to be done. and their top management got huge bonuses??????

Yea WTF?!

Not to mention their recent decline on the in-filght service. Even their first class service took a hit! I have not a clue what is going on in that boardroom but there are NO excuses now... Someone with a couple of balls needs to let Tilton know which way is up!



Al Gore invented global warming.
User currently offlineDallasnewark From Estonia, joined Nov 2005, 495 posts, RR: 1
Reply 4, posted (7 years 4 months 3 weeks 4 days 2 hours ago) and read 4795 times:

It's too bad they can't go into Chapter 11 that easily anymore, but it looks they are headed that way anyway.
What a mess. A year after they emerged from bankruptcy, they are back to square 1.
Oh well, at least there are some money to be made in shorting their stock



B732/3/4/5/6/7/8/9, B742/4, B752/3,B762/3/4, B772/3, A306, A318/9/20/21, A332/3, A343/6, MD80/83/88, L1011, TU104/134, F
User currently offlineN174UA From United States of America, joined Jun 2006, 994 posts, RR: 0
Reply 5, posted (7 years 4 months 3 weeks 4 days 2 hours ago) and read 4785 times:

Quoting FriendlySkies (Reply 2):
Tilton and the boys got UA off the brink. Me thinks it's time to bring someone a bit more visionary in to turn UA into what it used to be...a popular airline making more money than they knew what to do with.

 checkmark  Yep. I give it 2 or 3 more posts before someone comes in with the "hire Bethune" comment. In terms of labor relations, the well is very, very poisonous. Now might be a very good time for Tilton and crew to exit stage right.

Quoting FriendlySkies (Reply 2):
I'm a UA supporter, but there is no excuse for this kind of loss.

Slowest quarter of the year, delays, surge in oil prices are the official excuses. Behind the scenes, UA has a lot more work to do, obviously. Middle management issues, inconsistent service quality, etc. etc. Those I see are the biggest challenges right now.

Quoting Spoke2Spoke (Thread starter):
Weather was bad plus fuel was expensive equals weak earnings.

THere was also a change in the revenue recognition method for frequent flier miles, which resulted in a $100 million difference. That is a one time event. In quarters where you know things will be bad, that's when those kinds of changes are made.

I haven't had a chance to look at the cash position and cash flow statement. As long as they're CASH FLOW POSITIVE, I'm not all that worried.

Might be a good buying opportunity for UAUA...buy low now and as summer approaches, it should rebound a little.


User currently offlineGeorgebush From New Zealand, joined Jul 2006, 679 posts, RR: 0
Reply 6, posted (7 years 4 months 3 weeks 4 days 2 hours ago) and read 4762 times:

Quoting N174UA (Reply 5):
Might be a good buying opportunity for UAUA...buy low now and as summer approaches, it should rebound a little.

Let me know how that works out for ya.



Al Gore invented global warming.
User currently onlineFlighty From United States of America, joined Apr 2007, 8530 posts, RR: 2
Reply 7, posted (7 years 4 months 3 weeks 4 days 2 hours ago) and read 4762 times:

What I can't believe is that NEW senior corporate HQ in downtown Chicago. What hubris! What arrogance. A CEO needs to be near the directors of all sorts of departments. Who in turn need to be near the staff. The dual HQ just suggests UA management had their heads in the clouds. They were more interested in glamor than in running an airline.

User currently offlineDallasnewark From Estonia, joined Nov 2005, 495 posts, RR: 1
Reply 8, posted (7 years 4 months 3 weeks 4 days 2 hours ago) and read 4749 times:

Quoting N174UA (Reply 5):
I haven't had a chance to look at the cash position and cash flow statement. As long as they're CASH FLOW POSITIVE, I'm not all that worried

You meant Cash Flows from operations.

Quoting N174UA (Reply 5):
Might be a good buying opportunity for UAUA...buy low now and as summer approaches, it should rebound a little

Summer is historically weak season for stocks coupled together with the summer dirving season, making fuel prices even higher. It won't rebound till fall/winter



B732/3/4/5/6/7/8/9, B742/4, B752/3,B762/3/4, B772/3, A306, A318/9/20/21, A332/3, A343/6, MD80/83/88, L1011, TU104/134, F
User currently offlineSRT75 From United States of America, joined Jul 2005, 260 posts, RR: 0
Reply 9, posted (7 years 4 months 3 weeks 4 days 2 hours ago) and read 4732 times:

I'm a little suprised to see this. I've done a fair amount of UA domestic flying in the last few months and loads were consistently high, even on off-days like mid-week flights. I know, I know. . . . full planes does NOT always equal profitable flights.

I hope UA turns the corner.


User currently offlineRL757PVD From United States of America, joined Dec 1999, 4674 posts, RR: 11
Reply 10, posted (7 years 4 months 3 weeks 4 days 2 hours ago) and read 4691 times:

I see no excuse when comparing UA to other legacy airlines, they are all operating in the same environment and there should not be a drastic spead between them.

AA Posted a sizeable profit thanks to non-Ch11 reorganizing efforts

DL spent 1/2 as much time in CH11, and it cost them 1/2 as much and excluding Ch11, they would ahve had a $ 6 mil loss.

UA is not very different from either AA or DL so their finacial results shouldnt be either, Especially fresh out of CH11 !!



Experience is what you get when what you thought would work out didn't!
User currently offlineN174UA From United States of America, joined Jun 2006, 994 posts, RR: 0
Reply 11, posted (7 years 4 months 3 weeks 4 days 2 hours ago) and read 4680 times:

Quoting Dallasnewark (Reply 8):
You meant Cash Flows from operations.

To be specific, yes. Bigger picture, if UA sold an asset and received say $100 million from it for example, but cash flows from operations were at $(15) million, overall, they would still have positive cash flow of $85 million.

Cash flow and income/loss are two different things, two different financial statements. Short-term, you can show a net loss for a month or quarter, but as long as cash flows are positive, then long term, you're fine.

Conversely, you can show a small profit for a month or quarter, but if you had a big cash outlfow, and have future large cash outflows, then that becomes more of a longer-term concern.

[Edited 2007-04-25 17:24:46]

User currently offlineN174UA From United States of America, joined Jun 2006, 994 posts, RR: 0
Reply 12, posted (7 years 4 months 3 weeks 4 days 2 hours ago) and read 4637 times:

Quoting RL757PVD (Reply 10):
DL spent 1/2 as much time in CH11, and it cost them 1/2 as much and excluding Ch11, they would ahve had a $ 6 mil loss.

That is largely attributed to the fact DL didn't have to spend time renegotiating labor deals with every employee group. Plus, they had the advantage of seeing the mistakes that US and UA made before their case began.

If DL didn't leave any cost savings on the table during their time under court protection, unlike US, then their restructuring will be successful.


User currently offlineGeorgebush From New Zealand, joined Jul 2006, 679 posts, RR: 0
Reply 13, posted (7 years 4 months 3 weeks 4 days 2 hours ago) and read 4607 times:

Quoting SRT75 (Reply 9):
I'm a little suprised to see this. I've done a fair amount of UA domestic flying in the last few months and loads were consistently high, even on off-days like mid-week flights. I know, I know. . . . full planes does NOT always equal profitable flights.

Well one would think that more butts in the seats = more $$. I think their upper managements theory is... more butts in the seats = more paychecks for us!



Al Gore invented global warming.
User currently offlineBicoastal From , joined Dec 1969, posts, RR:
Reply 14, posted (7 years 4 months 3 weeks 4 days 2 hours ago) and read 4570 times:

I've been listening to the webcast of the earnings announcement. Go to www.united.com, bottom of the page and click on Investor Relations. Better to get the facts before commenting....something rare on this forum.

http://ir.united.com/VirtualPlayerFS...&IndexId=&EID_TIK=&RGT=&RGS=&CTID=


User currently offlineN174UA From United States of America, joined Jun 2006, 994 posts, RR: 0
Reply 15, posted (7 years 4 months 3 weeks 4 days 2 hours ago) and read 4551 times:

Here are some key facts that suggest UA is on the right track:

**UAL continued its strong cost performance, with first quarter mainline CASM decreasing by 4.3 percent from the first quarter of 2006. Excluding fuel, profit sharing programs and special items, mainline CASM decreased by 3.3 percent from the first quarter of 2006.

**Operating cash flow increased by 38 percent from the first quarter of 2006 to approximately $626 million.

**The company's cash and short-term investments balance at March 31, 2007 was $4.2 billion, including $856 million of restricted cash after reducing on and off balance sheet debt by $1.4 billion in the first quarter of 2007.

Source: www.united.com

[Edited 2007-04-25 17:49:38]

User currently offlineRDUDDJI From Lesotho, joined Jun 2004, 1481 posts, RR: 3
Reply 16, posted (7 years 4 months 3 weeks 3 days 22 hours ago) and read 4296 times:

Quoting N174UA (Reply 15):
**The company's cash and short-term investments balance at March 31, 2007 was $4.2 billion, including $856 million of restricted cash after reducing on and off balance sheet debt by $1.4 billion in the first quarter of 2007.

That reduction in debt alone will likely save UA about $100 millon/yr. in interest.

My biggest worry after reading the whole report is the drop in YOY revenue. That surprised me. I heard a few weeks ago that UA was seeing weaker than planned domestic revenue.

The loss hurts, but it's not all dark clouds... I also heard on the earnings call that they have some new routes planned to be announced in the next six months. It was also mentioned on the earning's call that those additional routes would likely come at the expense of some not-so-profitable routes.



Sometimes we don't realize the good times when we're in them
User currently offlineN174UA From United States of America, joined Jun 2006, 994 posts, RR: 0
Reply 17, posted (7 years 4 months 3 weeks 3 days 22 hours ago) and read 4241 times:

Quoting RDUDDJI (Reply 16):
I also heard on the earnings call that they have some new routes planned to be announced in the next six months. It was also mentioned on the earning's call that those additional routes would likely come at the expense of some not-so-profitable routes.

Good to hear. I'm glad that UA (finally) is making these kinds of decisions, rather than keeping routes like SFO-CDG alive for no reason. Hell, if some flight to LHR isn't profitable over a long time-frame, cut it and put the plane on something that will have a higher yield. Plain and simple.

UA needs to do something to restore the employee morale level. Too much bitterness, and that hasn't changed throughout the last several years.


User currently offlinePanamair From United States of America, joined Oct 2001, 4910 posts, RR: 25
Reply 18, posted (7 years 4 months 3 weeks 3 days 21 hours ago) and read 4198 times:
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Quoting N174UA (Reply 17):

UA needs to do something to restore the employee morale level. Too much bitterness, and that hasn't changed throughout the last several years.

I did notice Tilton somewhat stumbling through his answer when a reporter or an analyst asked him a question about employees' criticism of management and whether there would be an increase in labor costs in order to placate the rank-and-file......


User currently offlineJacobin777 From United States of America, joined Sep 2004, 14968 posts, RR: 59
Reply 19, posted (7 years 4 months 3 weeks 3 days 21 hours ago) and read 4186 times:

Quoting RL757PVD (Reply 10):
DL spent 1/2 as much time in CH11, and it cost them 1/2 as much and excluding Ch11, they would ahve had a $ 6 mil loss.



Quoting N174UA (Reply 12):

That is largely attributed to the fact DL didn't have to spend time renegotiating labor deals with every employee group. Plus, they had the advantage of seeing the mistakes that US and UA made before their case began.

If DL didn't leave any cost savings on the table during their time under court protection, unlike US, then their restructuring will be successful.

....add to the fact UA went into Chapter 11 during one of the worst periods in aviation history (certainly in recent memory).....DL however has been in Chapter 11 during a very strong "upcycle" recovery....which has helped DL's top and bottom line....

Quoting RDUDDJI (Reply 16):

My biggest worry after reading the whole report is the drop in YOY revenue. That surprised me. I heard a few weeks ago that UA was seeing weaker than planned domestic revenue.

......actually I've read that CO was stating "softening" of yields and possible profits..so its not too far fetched to hear UA something along the same lines....



"Up the Irons!"
User currently offlineN174UA From United States of America, joined Jun 2006, 994 posts, RR: 0
Reply 20, posted (7 years 4 months 3 weeks 3 days 21 hours ago) and read 4118 times:

Quoting Panamair (Reply 18):
whether there would be an increase in labor costs in order to placate the rank-and-file......

Money doesn't solve everything. I think it's more of a credibility/more things change, more they stay the same feeling amongs the rank and file.

That said, you could hire Santa Claus, Mickey Mouse, and Easter Bunny tomorrow to run UAL, and within a year or two, employees would ask for them to resign, too. So, I dunno....I don't have all the answers.


User currently offlineFloridaflyboy From United States of America, joined Jun 2006, 2012 posts, RR: 0
Reply 21, posted (7 years 4 months 3 weeks 3 days 20 hours ago) and read 4094 times:

Quoting FriendlySkies (Reply 2):
Tilton and the boys got UA off the brink. Me thinks it's time to bring someone a bit more visionary in to turn UA into what it used to be...



Quoting N174UA (Reply 5):
Now might be a very good time for Tilton and crew to exit stage right.

I tend to agree. Different CEOs serve different purposes during different times. Tilton served his purpose, and now it's time to bring someone in to help United in the next chapter of its existence.



Good goes around!
User currently offlineSpartanmjf From United States of America, joined Nov 2005, 502 posts, RR: 0
Reply 22, posted (7 years 4 months 3 weeks 3 days 20 hours ago) and read 4082 times:

DL turned an operating profit. US turned an operating profit. WN turned an operating profit. AA turned an operating profit.

If UA is not comparable to any of these, then to which carrier is it comparable. The carrier has used and misused the bankruptcy process to create the never ending crisis. When is enough enough?

But then, UA does have a really good compensation plan for its CEO.



"Nuts to the man in 21D!"
User currently offlineN174UA From United States of America, joined Jun 2006, 994 posts, RR: 0
Reply 23, posted (7 years 4 months 3 weeks 3 days 20 hours ago) and read 4032 times:

Quoting Spartanmjf (Reply 22):
DL turned an operating profit. US turned an operating profit. WN turned an operating profit. AA turned an operating profit.

If UA is not comparable to any of these, then to which carrier is it comparable. The carrier has used and misused the bankruptcy process to create the never ending crisis. When is enough enough?

To DL and AA and NW, yes. But to compare them to WN? UA and WN are airlines, yes. But two very different business models, and two very different sized companies.

WN has the highest rate of unionization in the industry, yet they've never had a strike. AA, UA, NW, et. al. can certainly take lessons from that, and how to more effectively manage it's workforce to avoid unnecessary strikes, slowdowns, etc.


User currently offlineF9Animal From United States of America, joined Dec 2004, 5050 posts, RR: 28
Reply 24, posted (7 years 4 months 3 weeks 3 days 19 hours ago) and read 3921 times:

Darn! It just goes to show that the industry is still struggling. I agree with some of the statements about Tilton and his team. He

Quoting RL757PVD (Reply 1):
That is a major dissapointment and clearly shows needs that more work needs to be done. and their top management got huge bonuses??????



Quoting FriendlySkies (Reply 2):
Tilton and the boys got UA off the brink. Me thinks it's time to bring someone a bit more visionary in to turn UA into what it used to be...a popular airline making more money than they knew what to do with.

I'm a UA supporter, but there is no excuse for this kind of loss. Other airlines had to deal with weather and fuel too.

I totally agree with both of your views. I know the weather had to be a huge factor on their $$$'s, and the price of fuel is not exactly a deal of the century. I think the trend we are observing for most of the industry will be here for awhile. They are talking about $80-$90 ppbl oil this year. That is going to hurt a few of the airlines.



I Am A Different Animal!!
25 Post contains images Buddys747 : That just goes to show it's not ALWAYS the unions fault, like some people like to complain about on hear all the time.
26 Bicoastal : For those interested in UA aircraft orders.......they said on the web cast today that UA will wait until the next generation of narrow bodies is avail
27 Congaboy : Negative, I disagree, Providence. Nobody else hubs DEN except F9...B6 took it on the chops, too, with JFK being a hell hole during the winter months.
28 Gigneil : I am unfamiliar with any UA management receiving any bonuses. NS
29 Post contains images UAL777 : UA got hit hard in DEN and ORD. It was estimated they lost $80 million because of the Denver storm alone. Tilton got something along the lines of 36
30 UA772IAD : Part of this begins with: $39.4 million to be exact. Unions are pissed because most eligable employees got pocket change in comparision ($200 or less
31 N174UA : Not in this cost environment. Adding manpower in the wrong place only makes things worse. The main problem is the lack of trust and credibility betwe
32 Post contains images UAL777UK : IMHO, I think Tilton and his motley crew did a fantastic job when UA went into CH11.......my god, how many people were on here saying that its only a
33 TruemanQLD : and that is suprising?
34 Dsa : I don't need to tell you how big an airline UA is, this is a loss yes but its not a huge loss. If the storm in DEN alone cost them $80 Million think o
35 UAL777UK : Young laddy, whats that supposed to mean?
36 Zeke : IMHO UA just have too many employees for the amount of revenue they generate, it adds to their costs significantly. I think their revenue was in the o
37 Ctermua : I really don't think too many employees is the problem. Working at line stations around the East coast, more often than not, we are stretched to the l
38 UAL777 : Never happen. SQ and UA are two TOTALLY different airlines.
39 Post contains images UAL777UK : And totally different cultures.
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