September 20, 2020

United Continental Posts $213 Million Loss

The loss was $213 million, or 65 cents a share, for United Continental Holdings, the company created by the airlines’ merger. That compares with a consolidated loss of $183 million, or 58 cents a share, in the same period last year, before the merger.

Revenues rose 11 percent, to $8.2 billion. But fuel costs surged nearly 35 percent, to $2.8 billion. Until they get a single operating certificate, United and Continental are still operating separately.

Airlines usually struggle in the first quarter, traditionally the weakest because of lower demand from leisure travelers. To make things worse, the airlines have also been forced to cut service to some international destinations since the beginning of the year because of Japan’s earthquake and the revolts in the Middle East.

Deutsche Bank expects United States carriers to post a cumulative loss of about $1 billion with overall revenues of $30 billion in the quarter. Still, in a measure of the industry’s slow recovery, which began last year, the bank expects carriers to generate positive cash flows for the quarter.

In response to the higher fuel costs, the airlines have begun paring capacity. United Continental has said it plans to cut its seats by 1 percent by May and 4 percent by September, ahead of the busy winter schedule.

Southwest Airlines, however, was once more an exception to the rule. The domestic carrier reported Thursday that its first-quarter profit was $5 million, down from $11 million in the same period last year. Its revenue rose 18 percent, to $3.1 billion.

American Airlines on Wednesday reported a loss in the first quarter of $436 million, or $1.31 a share, compared with $505 million, or $1.52 a share, in the quarter a year ago.

Delta Air Lines will report its earnings next Tuesday.

Article source: http://feeds.nytimes.com/click.phdo?i=f52808f71f28ca9ded525cf2dd325497

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