Sponsor Message:
Civil Aviation Forum
My Starred Topics | Profile | New Topic | Forum Index | Help | Search 
United Published 3rd Quarter Results  
User currently offlineBeaucaire From Syria, joined Sep 2003, 5252 posts, RR: 24
Posted (6 years 2 months 1 week 16 hours ago) and read 6130 times:

UAL Corporation the holding company whose primary subsidiary is United Airlines, reported a third quarter net loss of $779 million or $252 million, if non-cash, net mark- to-market losses on fuel hedge contracts and certain accounting charges are excluded, despite an increase of $946 million in consolidated fuel expense..

In pre-wallstreet opening the share-price gained 4%.

The company said on Tuesday its third-quarter net loss amounted to $779 million, or $6.13 per share, compared with a profit of $334 million, or $2.21 per share, a year earlier. Excluding one-time items, the carrier said it lost $1.99 per share.

The carrier said its hedge-related losses amounted to $519 million, but noted that it saw a cash gain of $17 million on contracts that settled during the third quarter.

Wall Street analysts had expected UAL to lose $2.48 per share, according to Reuters Estimates.
http://biz.yahoo.com/prnews/081021/aqtu006.html?.v=70

[Edited 2008-10-21 05:57:28]


Please respect animals - don't eat them...
36 replies: All unread, showing first 25:
 
User currently offlinePanamair From United States of America, joined Oct 2001, 4977 posts, RR: 25
Reply 1, posted (6 years 2 months 1 week 16 hours ago) and read 6085 times:
Support Airliners.net - become a First Class Member!

Other points:

Operating Revenues = $5.565 billion (up 0.7% from Q3 2007)

Net Loss = $779 million
Net Loss excluding specials = $252 million

Operating Loss = $491 million
Operating Loss excluding specials = $150 million

Unrestricted cash @Sep 30 = $2.9 billion


User currently offlineWorldTraveler From , joined Dec 1969, posts, RR:
Reply 2, posted (6 years 2 months 1 week 16 hours ago) and read 6074 times:

these numbers are very bad. UA can blame it on fuel which is significant but their revenue performance is very weak. Despite pulling capacity on the Pacific, Latin, and domestic, they underperformed AA, CO, and DL which have already reported.

There will be a lot of blood shed in the 4th quarter by the network carriers because of overly aggressive hedges by all the network carriers- and perhaps some LFCs but UA alone seems unable to get traction on generating decent revenue.

It is hard to imagine they have a future as a standalone airline. They have the cash to weather the downturn but with several quarters of this kind of performance - with or without fuel issues - UA will be in a position where it will be back in C11 -which may be necessary for them to merge w/ anyone - or they will engage in an asset sale so the acquiring company has the ability to stop the flow of red ink which seems to be in the DNA of UAL.


User currently offlineAA1818 From Trinidad and Tobago, joined Feb 2006, 3439 posts, RR: 4
Reply 3, posted (6 years 2 months 1 week 16 hours ago) and read 6054 times:

Usually one time items can be ignored which tend to make the results look rosy, but if UA is hedged at that high rate for more than just this quarter, then the mark to market losses on hedges cannot be ignored. Ouch UA! Let's hope with the low-ish oil price that all the US majors can turn things around.

AA1818



“The moment you doubt whether you can fly, you cease for ever to be able to do it.” J.M. Barrie (Peter Pan)
User currently offlineCharles79 From Puerto Rico, joined Mar 2007, 1331 posts, RR: 6
Reply 4, posted (6 years 2 months 1 week 16 hours ago) and read 6051 times:

Grim news for one of my favorite carriers. I've always enjoyed good service and pleasant F/As at United, they have a strong workforce but I wonder how committed can they remain when these kind of results are announced. Anyone know how is their workforce morale, are employees loosing faith in the market? I've always known them to be fighters...

User currently offlineBeaucaire From Syria, joined Sep 2003, 5252 posts, RR: 24
Reply 5, posted (6 years 2 months 1 week 16 hours ago) and read 6034 times:

I would imagine the United finance management has considered changing hedging at lower rates those last weeks-can't imagine them just sit idle and watch oil-rates sink without acting.
While I agree that the figures are bad,there are some signs of improvement in some areas ( Atlantic trafic,overal revenues,cash at hand..)
To those who anticipate they will just dissapear-that is the most unlikely scenario of all-they simply have to scale their business to the accessible market they have -which they do anyhow,since they lay off staff and reduce capacity;

[Edited 2008-10-21 06:36:04]


Please respect animals - don't eat them...
User currently offlinePanamair From United States of America, joined Oct 2001, 4977 posts, RR: 25
Reply 6, posted (6 years 2 months 1 week 15 hours ago) and read 5973 times:
Support Airliners.net - become a First Class Member!



Quoting WorldTraveler (Reply 2):
but their revenue performance is very weak

Agree that that was one glaring point in the picture. UA only managed a 0.7% increase in Total Operating Revenues, which is quite paltry compared to increases at AA, CO, and DL of 8.0%, 8.8%, and 9.0% respectively during the same period.

Remember that now is also the time that airlines are showing double-digit increases from Other Revenues, primarily all those extra fees (bags, ticket changes, etc.) - AA, CO, and DL all showed hefty double-digit percentage increases in this area, whereas UA actually went the other way and dropped about 3.3%.


User currently offlineBeaucaire From Syria, joined Sep 2003, 5252 posts, RR: 24
Reply 7, posted (6 years 2 months 1 week 15 hours ago) and read 5953 times:

United shares currently up 8%...


Please respect animals - don't eat them...
User currently offlineFlighty From United States of America, joined Apr 2007, 8774 posts, RR: 3
Reply 8, posted (6 years 2 months 1 week 15 hours ago) and read 5889 times:

They wrote down more than half a BILLION dollars in fuel gambling losses. You win some, you lose some.

User currently offlinePtugarin From United States of America, joined Sep 2006, 326 posts, RR: 0
Reply 9, posted (6 years 2 months 1 week 15 hours ago) and read 5868 times:

On a side note, as a frequent flyer who collects United miles, is it now a bad idea to keep "investing" in their miles or even if something happens to the airline, their miles will be honored by someone else?

User currently offlineAWACSooner From United States of America, joined Jan 2008, 1985 posts, RR: 1
Reply 10, posted (6 years 2 months 1 week 14 hours ago) and read 5773 times:

Begin the funeral durge...

User currently offlineBeaucaire From Syria, joined Sep 2003, 5252 posts, RR: 24
Reply 11, posted (6 years 2 months 1 week 14 hours ago) and read 5692 times:

Well at least the financial community seems to think they are not yet dead in the water,otherwise their shares would not move from 5$ six weeeks ago to nearly 14 $ this morning...


Please respect animals - don't eat them...
User currently offlineIloveboeing From United States of America, joined Oct 2005, 803 posts, RR: 0
Reply 12, posted (6 years 2 months 1 week 14 hours ago) and read 5678 times:



Quoting Beaucaire (Reply 17):
Well at least the financial community seems to think they are not yet dead in the water,otherwise their shares would not move from 5$ six weeeks ago to nearly 14 $ this morning...

Maybe shareholders are hoping that UA will merge with CO and the Tilton gang will step down...


User currently offlineUnited1 From United States of America, joined Oct 2003, 6134 posts, RR: 9
Reply 13, posted (6 years 2 months 1 week 14 hours ago) and read 5667 times:



Quoting Beaucaire (Reply 7):
United shares currently up 8%...

Make that 10% they beat wall streets expectations by ~20% in their results.

Wall street expected a -$2.48 a share loss before specials and UA posted a $1.99 loss before specials. Revenue was also expected to be around 5.54B they came in at 5.57B.

http://biz.yahoo.com/rb/081021/business_us_ual.html?.v=1

Not a great quarter but most of this is UA unwinding its fuel hedges....

PRASM was up 6.1%
CASM was flat (excluding fuel, charges)
RASM was up 6.2%
Cargo generated 10.6% more revenue
Yield went up by 7.1% (consolidated)

In September, first month with capacity reductions in place, UAs PRASM was up by 11%

There are some bright spots.



Semper Fi - PowerPoint makes us stupid.
User currently offlineMm320cap From United States of America, joined Jul 2004, 229 posts, RR: 3
Reply 14, posted (6 years 2 months 1 week 14 hours ago) and read 5587 times:



Quoting Ptugarin (Reply 9):
On a side note, as a frequent flyer who collects United miles, is it now a bad idea to keep "investing" in their miles or even if something happens to the airline, their miles will be honored by someone else?

United is in one of the strongest cash positions in the industry. While I don't agree with the aggressiveness of their capacity cuts, they are in a good position financially. With almost $3 Billion in cash, $3 Billion in unencumbered assets, and access to capital in this difficult market, I would say your Mileage Plus miles are as safe at United as they could be with any airline. With an operating loss of $150 million in one of the toughest quarters in history, and cash reserves like they have, United (love them or hate them) is going to be around for a long, long time. Take a look at the stock price today.


User currently offlineLAXdude1023 From India, joined Sep 2006, 7821 posts, RR: 25
Reply 15, posted (6 years 2 months 1 week 13 hours ago) and read 5444 times:

How does this compare with the others? Seems like everyone posted numbers they really cant be proud of this quarter.


Stewed...Lewd...Crude...Irreverent...Belligerent
User currently offlinePlateMan From United States of America, joined May 2007, 923 posts, RR: 0
Reply 16, posted (6 years 2 months 1 week 13 hours ago) and read 5366 times:

The numbers are actually better than expected in operating costs...

You all are quick to judge when you know nothing about financial results and instead take it out on your one bad experience with the airline...read the entire picture, look at the stock price and then you can see what really happened.

Look at their stock price up 9% currently



"Explore. Dream. Discover." -Mark Twain
User currently offlineUnited1 From United States of America, joined Oct 2003, 6134 posts, RR: 9
Reply 17, posted (6 years 2 months 1 week 13 hours ago) and read 5342 times:



Quoting LAXdude1023 (Reply 17):
How does this compare with the others? Seems like everyone posted numbers they really cant be proud of this quarter.

Taking a look at the operating profit/loss numbers UA posted a better result (% wise) then AA, and worse then CO or DL did.



Semper Fi - PowerPoint makes us stupid.
User currently offlineConcordeBoy From , joined Dec 1969, posts, RR:
Reply 18, posted (6 years 2 months 1 week 13 hours ago) and read 5314 times:



Quoting Ptugarin (Reply 9):
if something happens to the airline, their miles will be honored by someone else?

...depends on if anyone sees a compelling reason to assume that liability (i.e., a new customer base that they otherwise might not have acquired on their own). If not, they'd be more than happy to let it die.

We've seen both throughout recent history.


User currently offlineFlyDreamliner From United States of America, joined Jan 2006, 2759 posts, RR: 15
Reply 19, posted (6 years 2 months 1 week 12 hours ago) and read 5275 times:



Quoting WorldTraveler (Reply 2):
these numbers are very bad. UA can blame it on fuel which is significant but their revenue performance is very weak. Despite pulling capacity on the Pacific, Latin, and domestic, they underperformed AA, CO, and DL which have already reported.



Quoting AWACSooner (Reply 11):
Begin the funeral durge...

I think that people in this forum need to be less influenced popular opinion on this board and more influenced by business sense and reality. I don't agree with Glenn Tilton, et. al., over at UA and their strategy, but their methods are financially effective.

Their loss was less than Wall Street expected, aside from fuel hedges, they aren't doing badly for the market.

UA is not being run like an airline aficionado's airline, it's being run like a financial manager's airline.

Quoting Mm320cap (Reply 15):
United is in one of the strongest cash positions in the industry. While I don't agree with the aggressiveness of their capacity cuts, they are in a good position financially.

Their extreme cuts make good sense for a market in recession. They are trimming the old, expensive parts of the fleet. Their fleet is fairly new, decently outfitted, they have a good employee pool, terrific hubs, and amongst the most expansive route networks. What they are doing is cut the routes which aren't that profitable and focus on money making routes.

Ideally, I'd like to see UA like they were 10 years ago, when they were the biggest airline on earth, with flights all over the map, but the world and aviation industry is very different now. Even the mega airlines like AF/KL and the "merger of addition" DL/NW are trimming.

UA is doing fine. This forum should catch on to what Wall Street knows, UA is not going anywhere. We'll see Midwest, Frontier, US Airways drop before we see UA dropping.

UA, CO, AA, and DL are solvent.



"Let the world change you, and you can change the world"
User currently offlinePanamair From United States of America, joined Oct 2001, 4977 posts, RR: 25
Reply 20, posted (6 years 2 months 1 week 12 hours ago) and read 5241 times:
Support Airliners.net - become a First Class Member!



Quoting LAXdude1023 (Reply 17):
How does this compare with the others?

Looking at AA, UA, DL, CO, and WN (the airlines that have reported so far):

Operating Revenues / Operating Income / Operating Income (excluding specials)
AA: $6.4 bn / -$216m / -$189m
DL: $5.7 bn / +$131m / +$155m
UA: $5.6 bn / -$491m / -$150m
CO: $4.2 bn / -$152m / -$61m
WN: $2.9 bn / +$86m / +$86m

Operating Margin (ranked):
WN: +3.0%
DL: +2.3%
AA: -3.4%
CO: -3.7%
UA: -8.8%

Operating Margin (excluding special items) (ranked):
WN: +3.0%
DL: +2.7%
CO: -1.5%
UA: -2.7%
AA: -2.9%

Net Income / Net Income (excluding specials):
AA: +$45m / -$360m
DL: -$50m / -$26m
WN: -$120m / +$69m
CO: -$236m / -$145m
UA: -$779m / -$252m

Net Margin (ranked):
AA: +0.7%
DL: -0.9%
WN: -4.2%
CO: -5.7%
UA: -14.0%

Net Margin (excluding specials) (ranked):
WN: +2.4%
DL: -0.5%
CO: -3.5%
UA: -4.5%
AA: -5.6%

Still to come: NW, US, AS, FL, etc.


User currently offlineWorldTraveler From , joined Dec 1969, posts, RR:
Reply 21, posted (6 years 2 months 1 week 12 hours ago) and read 5190 times:



Quoting Panamair (Reply 6):
Remember that now is also the time that airlines are showing double-digit increases from Other Revenues, primarily all those extra fees (bags, ticket changes, etc.) - AA, CO, and DL all showed hefty double-digit percentage increases in this area, whereas UA actually went the other way and dropped about 3.3%.

and UA led the increases.

Quoting Charles79 (Reply 16):
If they can charge $300 more than DL while they charge extra fees and cut costs then that's how you make a profit.

but they underperformed on an aggregate basis.

there are all kinds of personal reports that can be given but in the end the only thing that matters is what is reported to Wall Street.

Quoting FlyDreamliner (Reply 21):
Their loss was less than Wall Street expected

when you estimate that you will have a horrific report and tell Wall Street that, you don't get brownie points just because you report 90% of horrible instead of 100%.

Quoting FlyDreamliner (Reply 21):
they aren't doing badly for the market.

yes, they are. read above.... they underperformed on revenues. UA has the industry's best assets (hubs, routes a/c) yet they continue to underperform on revenues.

I can give any cmopany some slack w/ hedges but UA is missing it on the fundamentals any airline management should get right.

Quoting FlyDreamliner (Reply 21):
Even the mega airlines like AF/KL and the "merger of addition" DL/NW are trimming.

DL and NW have released no coordinated schedules. DL and NW are reducing capacity independently but so is nearly every other US airline.


User currently offlineIliriBDL From Germany, joined May 2007, 1205 posts, RR: 14
Reply 22, posted (6 years 2 months 1 week 12 hours ago) and read 5142 times:



Quoting FlyDreamliner (Reply 21):
We'll see US Airways drop before we see UA dropping.

No you won't. You can bet on it.



delta.com
User currently offlineUnited1 From United States of America, joined Oct 2003, 6134 posts, RR: 9
Reply 23, posted (6 years 2 months 1 week 12 hours ago) and read 5118 times:



Quoting WorldTraveler (Reply 23):
Quoting FlyDreamliner (Reply 21):
they aren't doing badly for the market.

yes, they are. read above.... they underperformed on revenues. UA has the industry's best assets (hubs, routes a/c) yet they continue to underperform on revenues.

True they do have some of the best assets in the business, but that also means that they operate on some of the most highly contested routes in the industry and are subject to an incredible amount of competition across their network. Its no surprise that UAs takes a little longer to recover then some of their peers do.

As for missing on revenue UA came in on the high end of what Wall Street was expecting for revenue, how is that under performing?

As much as you continuously seem to want to believe that every airline is doing badly, save one, everyone is doing fairly well in this climate and FAR better then what was expected at the beginning of the year.

UA has some work to do and some challenges to overcome but no more then any of their peers int he industry do.



Semper Fi - PowerPoint makes us stupid.
User currently offlineUnited1 From United States of America, joined Oct 2003, 6134 posts, RR: 9
Reply 24, posted (6 years 2 months 1 week 12 hours ago) and read 5130 times:



Quoting IliriBDL (Reply 24):
Quoting FlyDreamliner (Reply 21):
We'll see US Airways drop before we see UA dropping.

No you won't. You can bet on it.

I think its a moot point as neither UA and US are going to drop anytime soon.



Semper Fi - PowerPoint makes us stupid.
25 Post contains links LAXDESI : More analysis and guidance. Looks like United will have another large hedging loss in the 4th quarter. http://www.marketwatch.com/news/stor...24E88F89
26 United1 : The fact that Baker is saying that is a very good sign, he is probably one of the most pessimistic airline analysts out their.
27 Beaucaire : United currently up 15% ..!
28 WorldTraveler : not true. LHR and most of UA's transpacific network is limited access, protected by slots, or has seen relatively small amounts of capacity changes.
29 Boston92 : Uhh, usually you don't increase revenue when you downsize.
30 Apodino : Some other observations: Out of all the legacies, United probably has the least pricing power. This is due to WN having become major players in LAX an
31 AWACSooner : You mean that we're just like the majority of the flying public who votes with their wallets...and thus chooses to take their money elsewhere when th
32 IliriBDL : I agree with you there.
33 Odysseus9001 : Thanks, nice summary. -John
34 Mm320cap : The problem I have with UAL is not that they are cutting capacity in a difficult fuel environment (which is what triggered the cuts - not the present
35 United1 : Are you kidding me? do you actually believe that DEN, LAX, SFO, ORD, and IAD not to mention LHR, Asia and all the rest of UAs international network i
36 Mm320cap : True statement. But they aren't cutting any CRJ200's either. They are parking a few E145's, but no CRJ200's, the least efficient plane in the sky[Edit
Top Of Page
Forum Index

This topic is archived and can not be replied to any more.

Printer friendly format

Similar topics:More similar topics...
AC's 3rd Quarter Results posted Fri Oct 31 2003 02:57:12 by StarAC17
Westjet And Air Canada Release 3rd Quarter Results posted Fri Nov 2 2001 23:47:24 by Fallingeese
United: 1st Quarter Results posted Sat Feb 25 2006 05:56:42 by HunUtazo
Swiss Improves Results In 3rd Quarter posted Tue Oct 15 2002 13:14:29 by Dtswi
Quarter 2 Results posted Mon Jun 30 2008 16:17:34 by United1
Boeing 4th Quarter Results: What's Expected? posted Sun Jan 27 2008 06:34:00 by TUIflyer
AA Quarter Results. posted Wed Jan 23 2008 19:01:25 by AAden
United Posts A 4th Quarter Loss posted Tue Jan 22 2008 06:04:40 by Skytony
Positive 3rd Quarter For Bombardier posted Thu Nov 29 2007 18:32:00 by CRJ900X
787 Update From Boeing's 3rd Quarter Earnings Call posted Wed Oct 24 2007 08:01:28 by NYC777