LAXintl From United States of America, joined May 2000, 23472 posts, RR: 50 Posted (5 years 7 months 3 weeks 2 days 15 hours ago) and read 10947 times:
Quote: UAL Corporation Reports First Quarter 2008 Results
Announces Actions to Combat Higher Fuel Costs
CHICAGO, April 22, 2008 /PRNewswire-FirstCall/ -- UAL Corporation (Nasdaq: UAUA - News), the holding company whose primary subsidiary is United Airlines, reported a pre-tax loss of $542 million for the first quarter ended March 31, 2008, $305 million higher than the first quarter of 2007, driven primarily by a $618 million increase in consolidated fuel expense. For the quarter, the company:
-- Reported basic and diluted loss per share (EPS) of $(4.45).
-- Increased mainline passenger unit revenue (or PRASM) by 8.7 percent
year-over-year through continued capacity discipline and strong yield
-- Continued its focus on controlling costs, with mainline cost per
available seat mile (CASM), excluding fuel and special items, for the
quarter up 2.4 percent versus 2007. Mainline CASM for the quarter was
up 15.9 percent versus the first quarter of 2007, reflecting a
50 percent increase in fuel price.
-- Strengthened its balance sheet by reducing on and off balance sheet
debt by $195 million. The company ended the quarter with an
unrestricted cash and short-term investments balance of $2.9 billion
and restricted cash of $0.7 billion.
-- Announced a plan to reduce 2008 non-fuel costs by an incremental
$200 million and to reduce 2008 capital expenditures by $200 million.
-- Acted decisively to reduce mainline domestic capacity by approximately
9 percent by the fourth quarter, on top of a 5 percent reduction in the
fourth quarter of 2007.
-- Announced plans to eliminate 30 aircraft from its operating fleet, 10
to 15 more aircraft than initially announced in March.
B707forever From United States of America, joined Dec 2007, 459 posts, RR: 0 Reply 2, posted (5 years 7 months 3 weeks 2 days 15 hours ago) and read 10924 times:
Hold onto your hat everyone. I've been saying a major is going to go bye bye this year. It's so clearly the price of fuel. The US government, for its misguided war, should be paying these airlines something to survive, considering they ultimately are responsible for these balance sheets. The 1st quarter would have been OK had the fuel costs been reasonable. Oh well, I've been saying for awhile, the American days of Empireness are over. This is yet another sign.
Sevenair From United Kingdom, joined Feb 2001, 1728 posts, RR: 0 Reply 4, posted (5 years 7 months 3 weeks 2 days 15 hours ago) and read 10900 times:
Yeah - this terminally ill, money burning machine needs to be allowed to go bust. Enough bailouts - let them sink. They are not strong enough to survive, lack vision, and are a drain on the US taxpayer. Let the fittest survive. And do not resuscitate a dead duck. DNR.
FriendlySkies From United States of America, joined Aug 2004, 4072 posts, RR: 5 Reply 6, posted (5 years 7 months 3 weeks 2 days 15 hours ago) and read 10783 times:
Quoting Sevenair (Reply 4): Yeah - this terminally ill, money burning machine needs to be allowed to go bust. Enough bailouts - let them sink. They are not strong enough to survive, lack vision, and are a drain on the US taxpayer. Let the fittest survive. And do not resuscitate a dead duck. DNR.
Oh for god's sake, you act like they're the only one who posted a loss! AMR just posed a $328 mil loss, not as bad but certainly not good! Even the LCCs are posting small losses...
Notice that the loss is entirely within the INCREASE in fuel prices this quarter. Unfortunately, none of the US majors really have a game plan to deal with fuel prices, and shame on them for it. They're slowly starting to get their act together, but I don't see one of them shutting down. If UA/CO happens, I could see US getting pushed out of the market just due to market share, but that's about the only scenario I see.
FriendlySkies From United States of America, joined Aug 2004, 4072 posts, RR: 5 Reply 10, posted (5 years 7 months 3 weeks 2 days 15 hours ago) and read 10716 times:
Quoting ANstar (Reply 9): Actually, you should read more carefully....
My quote was
Where did you get that number? From the linked article:
Cash and cash equivalents $2,438 $3,176 (23.2)
Short-term investments 486 193 151.8
Restricted cash 728 856 (15.0)
Total cash and cash equivalents,
short-term investments and
restricted cash (a) $3,652 $4,225 (13.6)
That says they have $2.438 billion in cash and cash equivalents, $728 million of which is restricted. It also shows the net negative cash flow was 23.2 million unrestricted. The entire $542 million isn't a cash loss.
Sevenair From United Kingdom, joined Feb 2001, 1728 posts, RR: 0 Reply 12, posted (5 years 7 months 3 weeks 2 days 15 hours ago) and read 10637 times:
Quoting FriendlySkies (Reply 6): Unfortunately, none of the US majors really have a game plan to deal with fuel prices, and shame on them for it.
Agreed - but the legacies have been in a mess for a long time, long before 9/11. They have had enough time to adapt, and posting hundreds of millions of $$$ of losses in ONE QUATER proves one thing - they still have not got it right. They have been given enough time, enough bailouts, enough help, and still, they are a disaster.
FreequentFlier From United States of America, joined Feb 2007, 872 posts, RR: 12 Reply 15, posted (5 years 7 months 3 weeks 2 days 15 hours ago) and read 10570 times:
Folks, before anyone goes nuts, profit and loss statements by all carriers are accounting numbers. The name of the game for all carriers is cash on hand these days, and UA still has 3.6 billion in cash. Then again, with oil prices so high these days, with seemingly no end in sight, that could go in a month or so! Ok maybe not, but oil prices are reaching the point of absurdity.
Comorin From United States of America, joined May 2005, 4861 posts, RR: 16 Reply 18, posted (5 years 7 months 3 weeks 2 days 14 hours ago) and read 10446 times:
From the same article:
Strong Liquidity Position
Due primarily to escalating fuel prices, the company generated negative operating cash flow of $80 million. The company made a special distribution of approximately $250 million to stockholders during the quarter and reduced on and off balance sheet debt by $195 million, ending the quarter with an unrestricted cash and short-term investments balance of $2.9 billion and a restricted cash balance of $728 million. Free cash flow, defined as operating cash flow less capital expenditures, declined to a negative $181 million.
In addition to its strong cash balance, the company has over $3 billion in unencumbered assets that provide it with significant flexibility to raise additional cash, if necessary.
Let's not write off UAL yet...they have the cash for a few more lousy quarters. Must be no fun being an airline CEO these days.
However, if fuel costs go up further, thanks to demand from India/China, UAL will be in a crunch by year end. A slowdown in the domestic economy will make it difficult to compensate with increased ticket prices.
Quoting B707forever (Reply 2): The US government, for its misguided war, should be paying these airlines something to survive, considering they ultimately are responsible for these balance sheets. The 1st quarter would have been OK had the fuel costs been reasonable. Oh well, I've been saying for awhile, the American days of Empireness are over. This is yet another sign.
What have you been smoking? Neither the U.S. gov't or Iraq set the price of oil?! It's market driven. If anyone is to blame, its China, for their skyrocketing demand as their economy is coming of age. Not to mention their currency being tied to the USD, and the fact that oil is priced in USD. But all of that is a story for another thread.
Sometimes we don't realize the good times when we're in them
Ctermua From United States of America, joined Jan 2006, 37 posts, RR: 0 Reply 24, posted (5 years 7 months 3 weeks 2 days 14 hours ago) and read 10300 times:
As an employee, I would say losing half a billion dollars in one quarter just reinforces my view that United is a completely rudderless ship. Our CEO and his team are spending most of thier time working out a marriage/sell off and and as the ship goes down, throwing random bandaids on the bleeding.(ie..raising change fees 50%) Granted, oil prices are out of control, but a good CEO will PLAN for worst case not just react. Our employees and customers deserve better...(loud sigh)
25 Comorin: UAL is also trading close to Book Value (Market Cap about $2.5B) so the markets are discounting all future cash flows from ops to zero. So if you went
26 EXAAUADL: please, if it was that easy to kill an airline the industry would be in the mess it's in. They have over $3b in cash. A company can live a long time
27 JayDub: I think it's time to see Glenn Tilton's head on a platter. I know he's there to make UA an aquisition target, but it is starting to look like no one w
28 B757capt: All the 737-500 will be grounded. Thats the old United Shuttle aircraft.
29 Socalfive: That is EXACTLY right except the drain on the tax payer, they're a drain on investors. UA hasn't learned to make money since before 9/11. The employe
30 Burkhard: The Chinese ( and Saudi ) currencies are no longer coupled to the USD. That is one of the reasons the USD is falling and oil gets so expensive in USD.
31 PSU.DTW.SCE: Easy for everyone to be critical of United, but I'd like to see you develop a business plan that is fluid enough to reacts rapidly enough to the quick
32 United787: This is sad, agreed. But it appears as though the biggest problem for all the airlines is fuel and fares. Fuel is to high and fares are too low. Are a
33 Jfk777: UA should be printing money in Asia with the Aussie dollar, the Yuan and the YEN all appreciating against the USD. The Euro should help too. IF UA can
34 Mcdu: Is basic reading and finances lost on you? Sit down, read the report again. Look at restricted and UNRESTRICTED cash numbers and then come back to th
35 Enilria: The real problem is that fuel keeps going up and fares aren't. If you add to that the losses the airlines are already facing you can expect United to
36 Beaucaire: The United-shares lose an unprecedented - 34.8 %!!!![Edited 2008-04-22 08:43:01]
37 Gigneil: You're not even an American. Point a single taxpayer dollar. I guess you both missed Continental's announcement last week, which was also horrendousl
38 N844AA: As of 11:48 a.m. EDT (20 min. delayed), CAL now has a larger market cap than UAUA. Not that that really means anything, but that wasn't the case when
39 Fonseca33: Tha Saudi currency, and most of the oil countries in the Gulf are still tied with the dollar, and they have said recently that it will stay that way.
40 CALMSP: does anyone know what type of management staff is being let go??
41 LAXDESI: UAL has been taking a depreciation charge of around $225 million; So in cash flow terms, UAL lost around $320 million last quarter. At the current rat
42 Zvezda: Dividends to the shareholders are not a gift. That money is already owned by the shareholders. If they want it back, management must give it back. If
43 Richierich: I wondered the same thing. Very very scary for anybody closely affiliated with UA. There comes a point where there is only so much fat that can be cu
44 Beaucaire: To put things into perspective : Market caps of some airlines – Air France 5.7billion € ( 9.12 billion $ ) Lufthansa 8.1 billion € ( 13 billion
45 United787: Can someone list all of the US airlines 1Q results in relation to their revenue or loss per share or some other economic indicator? Thanks!
46 United1: Actually UAL was around -80million in operating cash flow, which is not good but survivable in the short to medium term. So this was the bad quarter
47 MoMan: Hopefully everyone from Tilton's office down to front line flight supervisors.
48 LAXdude1023: Wow, thats a low blow. I thought AA wouls be the worst off this Quarter. I believe the only way to solve this for the airlines is to lower capacity an
49 Panova98: If you can't price your services to cover costs, get out of the business. Strange, but airline pricing people seem so adept at setting prices to run t
50 MaverickM11: I think with Easter falling in Q1, Q2 is going to be in the red as well.
51 United1: it's possible, however 2nd quarter shouldn't be anywhere near as bad as this one, and they should be back to cash positive of course god only knows w
52 LAXDESI: I wish it was that simple in practice.
53 Panova98: Darn it, I really wanted to buy some UAL shares yesterday, but I got sooo involved in this forum. Oh well, I guess nothing's happening with the share
54 Mcdu: Sorry but this was a gift. This was a one time SPECIAL dividend to generate shareholder desire to own UAL stock. So please research this dividend pri
55 Beaucaire: I bought a bunch of United shares,since i'm confident they will recover to a large extent in some months.. You'll never ever will get them so cheap !
56 Gigneil: The stock market is all science fiction, anyway, but analysts need to start getting fired. Their forecast accuracy on blue chips lately has been appal
57 Socalfive: Never missed a thing, but that's part of my point, there's little good reason to make things much more difficult in survival mode by taking on this a