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UAL Posts Net Profits  
User currently offlineOlympic472 From United States of America, joined Jun 2008, 436 posts, RR: 0
Posted (4 years 9 months 4 days 16 hours ago) and read 5895 times:

http://www.reuters.com/article/earningsSeason/idUSN2012095920090721

UAL reported a 28 million net profit for the 2 quarter.
Any detailed information to share on the planned cuts?


Civil Aviation has a "Need for Speed"!
27 replies: All unread, showing first 25:
 
User currently offlineUnited787 From United States of America, joined May 2005, 2641 posts, RR: 2
Reply 1, posted (4 years 9 months 4 days 15 hours ago) and read 5765 times:

Anything is better than a loss! Hope this shuts the UA naysayers up for a day or two... Congrats UA!

User currently offlineUal777 From United States of America, joined Aug 2003, 1519 posts, RR: 5
Reply 2, posted (4 years 9 months 4 days 15 hours ago) and read 5742 times:

Its a gain due to fuel hedges, but I'll take it! Cash increased by over 100 million as well...WTG UA!


It is always darkest before the sun comes up.
User currently offlineA388 From Netherlands Antilles, joined May 2001, 9570 posts, RR: 11
Reply 3, posted (4 years 9 months 4 days 15 hours ago) and read 5698 times:

This is good news indeed!!! Congratulations UA!!!

A388


User currently offlineSpacecadet From United States of America, joined Sep 2001, 3523 posts, RR: 12
Reply 4, posted (4 years 9 months 4 days 15 hours ago) and read 5547 times:

Guys, read the actual report. It's not particularly good news. It is better than expected, but revenue fell by 25.2% - that's huge - and excluding fuel hedges they lost $2.23 per share.

It's less of a a "champagne all around!" report and more of a "well, at least we don't need to declare bankruptcy again" report.



I'm tired of being a wanna-be league bowler. I wanna be a league bowler!
User currently offlineEnilria From Canada, joined Feb 2008, 6838 posts, RR: 14
Reply 5, posted (4 years 9 months 4 days 15 hours ago) and read 5483 times:



Quoting Ual777 (Reply 2):
Cash increased by over 100 million as well...WTG UA!

That's because they sold bonds paying 17% interest.

Quoting Spacecadet (Reply 4):
It's less of a a "champagne all around!" report and more of a "well, at least we don't need to declare bankruptcy again" report.

Same point as Spacecadet, and not meant to rain on anyone's parade, but if anybody sees this as a sign that UA is healthy and might be in a position to, for example, raise pilot wages, they are crazy. This is an aberration of one-time gains. To lose money (which is what really happened) in Summer is VERY bad. Fall could be cataclysmic.


User currently offlineLAXintl From United States of America, joined May 2000, 24326 posts, RR: 47
Reply 6, posted (4 years 9 months 4 days 14 hours ago) and read 5342 times:

Lets look beyond the headline number.


•Yes profit, but it was based solely on non-cash hedge gains and other charges.

•Otherwise had a net loss was $323 million ($2.23 share). This did however to beat market expectations which expected a loss of $2.56'ish/share.

•Closed the quarter with surprising strong cash position of $2.8 billion, with unrestricted cash of $2.6 billion.

•Raised $155 million in additional cash through that 17% interest spare parts transaction.

•Market conditions terrible.. A 17.2% y-o-y decline PRASM.

•Good cost control. Non-fuel CASM for the quarter down 1.2% yoy, despite a reduction in mainline capacity of 10.8% year-over-year.


Overall quite upbeat, and surprised me. Off course market demand continue to be dreary and this winter could be a long frigid one in the revenue arena.



From the desert to the sea, to all of Southern California
User currently offlineUal777 From United States of America, joined Aug 2003, 1519 posts, RR: 5
Reply 7, posted (4 years 9 months 4 days 14 hours ago) and read 5302 times:



Quoting Spacecadet (Reply 4):
Guys, read the actual report. It's not particularly good news. It is better than expected, but revenue fell by 25.2% - that's huge - and excluding fuel hedges they lost $2.23 per share.

It's less of a a "champagne all around!" report and more of a "well, at least we don't need to declare bankruptcy again" report.

They beat wallstreet expectations by over 20 cents. That is nothing to sneeze at and it was far better than the crowd here was expecting.

Quoting Enilria (Reply 5):

That's because they sold bonds paying 17% interest.

17% EFFECTIVE interest rate. The actual rate on the bonds is like 12.5% and its due to the type of collateral used.



It is always darkest before the sun comes up.
User currently offlineFxramper From United States of America, joined Dec 2005, 7129 posts, RR: 87
Reply 8, posted (4 years 9 months 4 days 14 hours ago) and read 5249 times:

I bet this is hysterical for the flight attendants at UA that get the news of furlough in 3 days.  

[Edited 2009-07-21 08:25:38]

User currently offlineUnited1 From United States of America, joined Oct 2003, 5817 posts, RR: 9
Reply 9, posted (4 years 9 months 4 days 14 hours ago) and read 5237 times:



Quoting Ual777 (Reply 7):
Quoting Enilria (Reply 5):

That's because they sold bonds paying 17% interest.

17% EFFECTIVE interest rate. The actual rate on the bonds is like 12.5% and its due to the type of collateral used.

I don't believe that the spare parts transaction counted in the second quarter results. UA said they completed the transaction during the early part of 3rd quarter. Supposedly all of these numbers are end of second quarter.

"During the second quarter, the company generated $396 million of positive operating cash flow and $305 million of positive free cash flow, defined as operating cash flow less capital expenditures. The company had scheduled debt and net capital lease payments of $212 million during the quarter and non-aircraft capital expenditures of $91 million."

http://ir.united.com/phoenix.zhtml?c...-newsArticle&ID=1309413&highlight=

It looks like UA was cash positive....



Semper Fi - PowerPoint makes us stupid.
User currently offlineLuv2cattlecall From United States of America, joined Sep 2007, 1650 posts, RR: 2
Reply 10, posted (4 years 9 months 4 days 14 hours ago) and read 5212 times:
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Quoting Fxramper (Reply 8):
I bet this is hysterical news for the flight attendants at UA that get the news of furlough in 3 days. Yeah sure

Are you suggesting that they keep unnecessary employees on staff and become a job creation program vs. a profit-seeking company?



When you have to breaststroke to your connecting flight...it's a crash!
User currently onlineMasseyBrown From United States of America, joined Dec 2002, 5216 posts, RR: 7
Reply 11, posted (4 years 9 months 4 days 14 hours ago) and read 5120 times:



Quoting Ual777 (Reply 2):
Its a gain due to fuel hedges, but I'll take it!

Why not? A profit is a profit. During all those quarters when WN's only profits came from fuel hdges, they were called geniuses. Time for UA to get a little credit.



Consilivm: Cave ne nothi te vexant
User currently offlineAWACSooner From United States of America, joined Jan 2008, 1800 posts, RR: 1
Reply 12, posted (4 years 9 months 4 days 14 hours ago) and read 5104 times:

I'm sure the UA sunshine pumpers will be out in force, but reading that report does NOT give me any warm fuzzies about the future of this airline. I think all it is doing is delaying the inevitable.

User currently offlineN505FX From United States of America, joined Aug 2008, 246 posts, RR: 0
Reply 13, posted (4 years 9 months 4 days 13 hours ago) and read 4868 times:

Most of the facts that the UAL haters are stating are global industry issues - the important part is how each of the players deals with the global economic crisis dealt them.

Relative to their competition on business issues controllable by management and employees AND in light that there are hundreds of people on these boards that would like to write UAL off as dead, their performance is better than their peers...even the golden child Continental.

Also, keep in mind they turned in this kind of performance while making cap ex. improvements on fleet and onboard product, and taking the lead on new ways to generate profit, that every other airline has followed along with.

In a cash flow imperative industry, their results are pretty good - and the cash balance avail. doesn't reflect the credit facility against the spares, that will hit the books in Q3.


User currently offlineHatbutton From United States of America, joined Mar 2005, 1477 posts, RR: 14
Reply 14, posted (4 years 9 months 4 days 12 hours ago) and read 4695 times:
Support Airliners.net - become a First Class Member!



Quoting Luv2cattlecall (Reply 10):


Quoting Fxramper (Reply 8):
I bet this is hysterical news for the flight attendants at UA that get the news of furlough in 3 days. Yeah sure

Are you suggesting that they keep unnecessary employees on staff and become a job creation program vs. a profit-seeking company?

I agree, $28 million is not enough to sustain growth or subsidize shrinkage for a company the size of UA. It's better than losing money, but making money doesn't mean that jobs automatically are saved just because.


User currently offlinePlanesNTrains From United States of America, joined Feb 2005, 5283 posts, RR: 29
Reply 15, posted (4 years 9 months 4 days 9 hours ago) and read 4344 times:



Quoting MasseyBrown (Reply 11):
Quoting Ual777 (Reply 2):
Its a gain due to fuel hedges, but I'll take it!

Why not? A profit is a profit. During all those quarters when WN's only profits came from fuel hdges, they were called geniuses. Time for UA to get a little credit.

I agree. But then you also have to say that UAL is no longer an airline per se, but rather a financial services/trading company that happens to run an airline.  Smile

Quoting AWACSooner (Reply 12):
I'm sure the UA sunshine pumpers will be out in force, but reading that report does NOT give me any warm fuzzies about the future of this airline. I think all it is doing is delaying the inevitable.

After reading many of your posts of late, I'm trying to find out if there is a carrier that you actually feel positive about. I'm not attacking you, but I'm starting to associate your posts with some of the other naysayers. Just curious...

Quoting N505FX (Reply 13):
Relative to their competition on business issues controllable by management and employees AND in light that there are hundreds of people on these boards that would like to write UAL off as dead, their performance is better than their peers...even the golden child Continental.

From the CO earnings thread:

Quoting Panamair (Reply 7):
UA: Total Revenues: $4.018 billion
Net Loss (excluding one-time items): $323 million
Net Margin: - 8.04%

CO: Total Revenues: $3.126 billion
Net Loss (excluding one-time items): $169 million
Net Margin: - 5.41%

So that may not appear to be an accurate statement.

-Dave



Totes my goats!
User currently offlineAWACSooner From United States of America, joined Jan 2008, 1800 posts, RR: 1
Reply 16, posted (4 years 9 months 4 days 9 hours ago) and read 4272 times:



Quoting PlanesNTrains (Reply 15):

After reading many of your posts of late, I'm trying to find out if there is a carrier that you actually feel positive about. I'm not attacking you, but I'm starting to associate your posts with some of the other naysayers. Just curious...

When it comes to most of the legacies, yes...just like what should've happened to the auto industry, I believe that we should stop subsidizing failed practices and crappy management and let these companies move over and make room for those who can run these industries effectively. All these nickel and dime fees are the epitome of what's wrong with the industry.


User currently offlineCharlienorth From United States of America, joined Jun 2006, 1113 posts, RR: 5
Reply 17, posted (4 years 9 months 4 days 9 hours ago) and read 4250 times:

I'm still waiting for the inevitable "how will UAL be divided?" posts.

User currently offlineVC10DC10 From United States of America, joined Apr 2006, 1030 posts, RR: 2
Reply 18, posted (4 years 9 months 4 days 8 hours ago) and read 4159 times:



Quoting LAXintl (Reply 6):
•Market conditions terrible.. A 17.2% y-o-y decline PRASM.

Sorry to be ignorant or dense, but what is PRASM?

Quoting Ual777 (Reply 7):
17% EFFECTIVE interest rate. The actual rate on the bonds is like 12.5% and its due to the type of collateral used.

Does anyone have a link to more info/news about this? I guess I don't understand the terms of this deal.


User currently onlineMasseyBrown From United States of America, joined Dec 2002, 5216 posts, RR: 7
Reply 19, posted (4 years 9 months 4 days 8 hours ago) and read 4135 times:



Quoting PlanesNTrains (Reply 15):
I agree. But then you also have to say that UAL is no longer an airline per se, but rather a financial services/trading company that happens to run an airline. Smile

Something like that was said by me (among others) about WN a couple years ago; but a.net's WN fans strongly objected. "A very successful hedge fund that operates a money-losing airline" was the comment by a professional WN analyst.

A profit is a profit, though; and UA's conf. call had a lot more measurably good things to say than CO's did.



Consilivm: Cave ne nothi te vexant
User currently offlineLAXintl From United States of America, joined May 2000, 24326 posts, RR: 47
Reply 20, posted (4 years 9 months 4 days 8 hours ago) and read 4067 times:



Quoting VC10DC10 (Reply 18):
Sorry to be ignorant or dense, but what is PRASM?

No worries.

PRASM is Passenger Revenue per Available Seat Mile.

Not normal RASM which is inclusive of all unit revenues.



From the desert to the sea, to all of Southern California
User currently offlineVC10DC10 From United States of America, joined Apr 2006, 1030 posts, RR: 2
Reply 21, posted (4 years 9 months 4 days 8 hours ago) and read 4026 times:



Quoting LAXintl (Reply 20):

Thanks, LAXintl!


User currently offlineUAL777 From United States of America, joined Aug 2003, 1519 posts, RR: 5
Reply 22, posted (4 years 9 months 4 days 7 hours ago) and read 3944 times:



Quoting VC10DC10 (Reply 18):

Does anyone have a link to more info/news about this? I guess I don't understand the terms of this deal.

Its not even included in Q2. The cash infusion will be recorded in Q3. The interest rate is higher because of the collateral TYPE not because UA is about to shutter its doors. Engine parts are hard to collect on thus creditors do not like them.

I think it is more of a "weather the storm" type deal that UA wants with the unpredictibility of the coming fall.



It is always darkest before the sun comes up.
User currently offlineDC8FanJet From United States of America, joined Aug 2006, 393 posts, RR: 0
Reply 23, posted (4 years 9 months 4 days 7 hours ago) and read 3918 times:

Excuse me, but when Southwest was making their profits because of fuel hedges,
they were hailed as genius...why is it "not champagne all around" when United makes
profits the same way?


User currently offlinePar13del From Bahamas, joined Dec 2005, 6729 posts, RR: 8
Reply 24, posted (4 years 9 months 4 days 7 hours ago) and read 3901 times:



Quoting Ual777 (Reply 7):
They beat wallstreet expectations by over 20 cents. That is nothing to sneeze at and it was far better than the crowd here was expecting.

It would be better if you had said they beat Wall Street expectation of a loss by loosing 20 cents less. Not to place this on UA, but the bean counters have raised number crunching to new levels, like lost revenue, how can you loose what is not yours, I was ok when they said revenue decreased, that I understood.

As for the gain being based on fuel hedges, if that is what UA uses to suppliment their income to ensure that they continue to present a viable product, go for it, no one had a problem when airlines got in with hotels, rental car companies or credit card companies, so whats the difference?


25 Klkla : Airline earnings reports are always complicated and can be spun in any way you want. If you want to see bad news, you will see it. If you want to see
26 NorCal : So how will UAL be divided? Just kidding! While nothing to celebrate over, a profit is a profit and making any money in this environment is not only
27 PlanesNTrains : Truth be told, i was probably one of those people. -Dave
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