UnitedTristar
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UA To Post 2QTR Profits

Mon Jul 24, 2006 8:19 pm

 
ATLFlyer323
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RE: UA To Post 2QTR Profits

Mon Jul 24, 2006 8:24 pm

I sure hope your right, it would be nice to see UA make money...for a change.  Silly

~Brandon
Everyday, the fluffy temptation of wheat!
 
halls120
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RE: UA To Post 2QTR Profits

Mon Jul 24, 2006 9:22 pm

Quoting UnitedTristar (Thread starter):
Great News for UA!

Wonder what all the UA doomsayers will have to say about this news? Other than the fact that AA made a bigger profit in the same period, of course.

Kudos to UA. I know one reason they are making money - I booked a flight to Heathrow for September, and it was significantly more expensive than last year. Which is a good thing, of course - better that UA actually price their product to make a profit.....
"Suppose you were an idiot. And suppose you were a member of Congress. But I repeat myself." Mark Twain, a Biography
 
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kc135topboom
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RE: UA To Post 2QTR Profits

Mon Jul 24, 2006 9:33 pm

Well, I am one of those who didn't think UA would survive bankruptcy. Can I have my crow cooked well done? Good news for UA.
 
BMIFlyer
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RE: UA To Post 2QTR Profits

Mon Jul 24, 2006 9:36 pm

Well done UA  Smile



Lee
Sometimes You Can't Make It On Your Own
 
worldtraveler
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RE: UA To Post 2QTR Profits

Mon Jul 24, 2006 9:40 pm

As I’ve said, all US airlines are expected to post at least an operating profit this quarter and probably into the next quarter. While this is good news for the industry as a whole, this doesn’t say that the industry has reached a period of sustained profitability which means that you have to look beyond whether there is a profit or not to the fundamentals of the business.

UA has slashed a heck of a lot of costs and has done a good job of getting to industry average profitability. However, there are other more aggressive carriers that are doing a better job of adapting to the current environment and protecting their markets. UA’s costs are still above average and their network is still under attack from low fare carriers. UA is just getting started in DEN, is growing aggressively in CHI, and hasn’t even started IAD. Carriers continue to expand service to Asia at a time when UA has no new planes to use to try to protect its routes.

UA faces a difficult couple of years ahead of them.

But UA people have sacrificed a lot and should enjoy a little calm air. But don’t take the seatbelt off yet. There is still turbulence ahead.
 
RDUDDJI
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RE: UA To Post 2QTR Profits

Mon Jul 24, 2006 9:41 pm

Whew, that news just made my day. I'm just worried about what's going to happen to all carriers when fuel hits $100+ a barrel.
Sometimes we don't realize the good times when we're in them
 
AMSSpotter
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RE: UA To Post 2QTR Profits

Mon Jul 24, 2006 9:45 pm

Good news, I wish UAL and it's employees well!
 
bistro1200
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RE: UA To Post 2QTR Profits

Mon Jul 24, 2006 9:45 pm

From Yahoo:
"We expect to report results that exceed current second quarter consensus expectations because of the continuing benefits of our restructuring, strong revenue growth, and our cost control efforts," said Glenn F. Tilton, United's president, CEO and chairman. "We will report a profit and continued strong cash generation.

Right on! So we're talking about about a $90 Million profit, if I did my math correctly. Not to mention, "continued strong cash generation" adds to the already impressive 4.5 Billion in the bank.

Thanks to everyone that flew UA and made this possible.
Measure to the millimeter, mark with a crayon, cut with an axe.
 
UAL777UK
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RE: UA To Post 2QTR Profits

Mon Jul 24, 2006 9:53 pm

Excellant news.

With that expanding bottom line, the upgrade of F & J on the International Fleet starting in 2007, I wonder when we will see an order for new aircraft, 1st quarter 2007?
 
flightopsguy
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RE: UA To Post 2QTR Profits

Mon Jul 24, 2006 10:00 pm

Quoting Bistro1200 (Reply 8):
Right on! So we're talking about about a $90 Million profit, if I did my math correctly. Not to mention, "continued strong cash generation" adds to the already impressive 4.5 Billion in the bank.

The press reports quote a "bottom line" profit of $114M with actual operating earnings (or profit from actually selling tickets and running flights, without all the special charges) of $260M. Cash in the bank increased to $5.1B.

Also capacity increases for the full year by 3% overall, which includes an express increase of 10% as reported.
A300-330 BAC111/146/J31/41 B99/1900 CV580 B707-777 DC8/9/10 L188/1011 FH227/28/100 SB340 DO228 EMB2/170 CR2-900 SH330-60
 
planespotting
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RE: UA To Post 2QTR Profits

Tue Jul 25, 2006 2:30 am

woohoo

earnings are expected to be around 93 cents per share, which is more than twice the expected 46 cents per share estimate of Wall Street!

Good news, especially with fuel being in the $60-70/barrel range for the entire quarter!
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ORDTerminal1
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RE: UA To Post 2QTR Profits

Tue Jul 25, 2006 2:38 am

Quote:
I'm just worried about what's going to happen to all carriers when fuel hits $100+ a barrel.

I wouldn't worry much about the carriers. Eventually they will realize that they have to price their product correctly in order to sustain profit. Of course with higher fares, demand for air travel will likely wain slightly.

I'd worry more about the amount of money I'm gonna have to pay to fly.
717, 727, 732,733, 734, 735, 738, 742, 744, 752, 763, 319, 320, 340, F100
 
travelin man
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RE: UA To Post 2QTR Profits

Tue Jul 25, 2006 2:53 am

Got this from the UBS analyst this morning:


* Strong preliminary Q2 results
This morning United released preliminary Q2 GAAP EPS of $0.93/diluted share - about double consensus for the quarter. The upside (at least in our model) came primarily from the cost side with CASM ex-fuel and items up only 1.5%. Mainline RASM growth was similar to what CAL and AMR reported - a robust +12%.

* Raising oil price forecast
We are raising our oil price assumption for Q3 to $74.50/bbl from $69/bbl and our long-run price to $70 from $69, in line with our European airline team. Our crack spread assumption remains $15/bbl for all periods. However, we are also lowering our CASM ex-fuel assumptions
- generally for a net benefit to EPS.

* Our view on the stock
We expect UAUA to continue to surprise to the upside as its leverage and corporate travel exposure bear fruit in a strong fare environment. We don't like its strategy of operating a complex operation (many aircraft
configurations/brands) in an attempt to capture RASM premiums but believe it is largely irrelevant in this fare environment. We rate UAUA Buy 2.

* Valuation: No Change
2006 EPS moves to $1.49 from $0.35 and 2007 to $3.33 from $2.85. Our $42 PT remains unchanged and is based on 6x trailing and forward Q2/07 EV/EBITDAR.


They seem pretty bullish on UA, even though they "don't like its strategy of operating a complex operation (many aircraft configurations/brands) in an attempt to capture RASM premiums."
 
roseflyer
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RE: UA To Post 2QTR Profits

Tue Jul 25, 2006 2:59 am

This is great news. They made some massive cuts in bankruptcy. From what I've read, the trimmed $7 Billion in costs. What makes that more impressive is that year end revenue will probably be less than $20 Billion, which means they cut their costs by about 35% of their revenue, which is incredible.

Quoting ORDTerminal1 (Reply 12):
I wouldn't worry much about the carriers. Eventually they will realize that they have to price their product correctly in order to sustain profit. Of course with higher fares, demand for air travel will likely wane slightly.

You make it sound like that is so easy. That might be what they teach in economics 101, but revenue management is so much more complicated. Yes you can raise fares, but if others don't, revenue will fall instead of increase. Now the easy solution would be if the airlines cooperated and made an agreement to all increase fares. But the problem with that is the fact that cartels are illegal and the government will step in and put a stop to this (there is already pressure from some groups for airlines collectively adding fuel charges). Airlines are in a lose lose situation. They can't increase fares, and if they find a way to do it, they run the risk of someone not complying or being guilty of collaborating to increase prices. Isn't a capitalism great? The natural solution is for there to be mergers, acquisitions or liquidation. That is very slow to happen in an industry like the airline market since costs associated with acquisitions are so incredibly high. You can't just but a company and let them continue to operate separately when it is an airline. And with the disruptions that would be caused in the country, the government and investors want to avoid liquidations as much as possible. So the end result is an overly competitive market with no easy solution to get out of it.

I personally am glad that United has been improving. There still is a long way to go if they want to repay all of their debt. A merger might be the best way, but it is hard to say if there is anyone out there wanting to do this. The recent merger of AA and TWA had some problems and AA's finances went down the tube before they got some major concessions. However US and HP seem to be doing very well and are posting profits while going through merger costs. Hopefully this merger which is appearing successful will make other companies and investors more likely to want to merge other airlines and reduce redundant capacity and improve efficiency. For the sake of all those that work in the airline industry, I hope there are some mergers so that wages can naturally begin to increase. Overcompetition results in companies needing to get wage flexibility. Wage flexibility hurts people in a downturn. Eventually though wages have to increase.

[Edited 2006-07-24 20:04:06]
If you have never designed an airplane part before, let the real designers do the work!
 
CTHEWORLD
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RE: UA To Post 2QTR Profits

Tue Jul 25, 2006 4:15 am

Don't overlook the positive cash flow and increasing cash bank balance as well!

C
 
NYC777
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RE: UA To Post 2QTR Profits

Tue Jul 25, 2006 4:44 am

Any word on potential aircraft orders?
That which does not kill me makes me stronger.
 
tsaord
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RE: UA To Post 2QTR Profits

Tue Jul 25, 2006 4:55 am

Great news. I'll say congratulations on a job well done only if they continue to profit for the rest of the year in the other quarters! Same for AA as well. But every little bit helps. Continued profit now is the ultimate aim.
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ChicagoOhare
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RE: UA To Post 2QTR Profits

Tue Jul 25, 2006 5:13 am

787's here we come!!!!

Great news UA, keep up the good work.
 
ORDTerminal1
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RE: UA To Post 2QTR Profits

Tue Jul 25, 2006 5:41 am

Quote:
RoseFlyer

I don't mean it to sound easy. I'm just trying to say that the airlines need to differentiate their own products and services from eachother, and in that sense, they will have more pricing autonomy.

Quote:
I personally am glad that United has been improving.

You aren't alone on that  Smile
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aircanada014
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RE: UA To Post 2QTR Profits

Tue Jul 25, 2006 5:47 am

Well thats good news to hear about UA. I'm glad they did well in the first quarter profit. Hopefully they will continue their success.
 
bistro1200
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RE: UA To Post 2QTR Profits

Tue Jul 25, 2006 10:45 am

Quoting NYC777 (Reply 16):
Any word on potential aircraft orders?

Tilton has said on several occasions that no new aircraft would be on the property before 2010. Several YEARS of modest profit would have to occur before UA can entertain the idea of capital purchases.

But, notice that UAX is now bigger than mainline. Couple that with the long range of the new UAX fleet (IAD-TUS announced in a E170) and the net effect is that A320s and 757s are flying routes that can support them, and not the ORD-DSM overnights. In other words, large aircraft time is freed by having smaller aircraft doing the 2 hour out-and-backs (DEN-ATL, ABQ-SFO). Then larger aircraft can do things like transcons and long haul point-to-point (SAN/SEA-HNL, Mexico)
Measure to the millimeter, mark with a crayon, cut with an axe.
 
Bicoastal
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RE: UA To Post 2QTR Profits

Tue Jul 25, 2006 10:54 am

Quoting Bistro1200 (Reply 21):
Then larger aircraft can do things like transcons and long haul point-to-point (SAN/SEA-HNL, Mexico)

Bistro, I agree with your overall point, but the SAN/SEA-HNL example doesn't support your argument. Those routes are and are planned to be only once a week...Saturday there, red-eye return. Fortunately for United, those large 757s are needed on many of the 2 hour hops during the week to feed their hubs/internationals and can only be spared on weekends for the SAN/SEA-HNL routes.
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UAL777UK
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RE: UA To Post 2QTR Profits

Tue Jul 25, 2006 4:49 pm

Quoting Bistro1200 (Reply 21):
Tilton has said on several occasions that no new aircraft would be on the property before 2010. Several YEARS of modest profit would have to occur before UA can entertain the idea of capital purchases.

True, but they cannot wait until 2010 before they order them, they need to think about ordering in the next 6-12 months otherwise they will be looking at delivery of any new aircraft after 2010...Come on UA, order the 747-8i and 787 and put us all out of our misery!!! Big grin
 
UnitedTristar
Topic Author
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RE: UA To Post 2QTR Profits

Wed Jul 26, 2006 10:53 am

Quoting Bistro1200 (Reply 21):
But, notice that UAX is now bigger than mainline. Couple that with the long range of the new UAX fleet (IAD-TUS announced in a E170)

I must disagree. IAD to TUS is in the schedules as a 319...mainline not express

-m

 airplane 
 
UALramperORD
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RE: UA To Post 2QTR Profits

Wed Jul 26, 2006 1:41 pm

Quoting UnitedTristar (Reply 24):
I must disagree. IAD to TUS is in the schedules as a 319...mainline not express

Actiually, thats connecting service through PHX. Also good to see UA making money, but one has to wonder how much longer till they ask for more money from employees.
"Roger, cleared to push spot 3"
 
tozairport
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RE: UA To Post 2QTR Profits

Wed Jul 26, 2006 2:14 pm

Quoting UALramperORD (Reply 25):
but one has to wonder how much longer till they ask for more money from employees.

They can ask all they want, but that turnip has been squeezed dry. They will get not one more cent. Glenn will have to sell his new pad in the Keys first...
Meet the new boss, same as the old boss.
 
UnitedTristar
Topic Author
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RE: UA To Post 2QTR Profits

Wed Jul 26, 2006 8:11 pm

Quoting UALramperORD (Reply 25):
Actiually, thats connecting service through PHX.

Not any longer...starting shortly it will be nonstop. The PHX TUS route once daily will end when the nonstop begins.

-m

 airplane 
 
UALramperORD
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RE: UA To Post 2QTR Profits

Thu Jul 27, 2006 9:48 am

Quoting Tozairport (Reply 26):
They can ask all they want, but that turnip has been squeezed dry. They will get not one more cent. Glenn will have to sell his new pad in the Keys first...

LOL, I sure hope your right. Good luck to us all at UA.
"Roger, cleared to push spot 3"