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United Airlines Corporation Reports Second Quarter 2008 Results
Taking Action to Offset Record Fuel Costs, and Position Company to Compete
CHICAGO, July 22
Driven by a $773 million increase in consolidated fuel expense, UAL Corporation (Nasdaq: UAUA), the holding company whose primary subsidiary is United Airlines, reported a net loss of $2.7 billion or $151 million, excluding certain largely non-cash accounting charges. For the second quarter ended June 30, 2008, the company:
Driven by a $773 million increase in consolidated fuel expense, UAL Corporation (Nasdaq: UAUA), the holding company whose primary subsidiary is United Airlines, reported a net loss of $2.7 billion or $151 million, excluding certain largely non-cash accounting charges. For the second quarter ended June 30, 2008, the company:
Reported basic and diluted loss per share of $1.19 excluding certain largely non-cash accounting charges described below. United's reported GAAP loss per share was $21.47.
Recorded $2.6 billion of previously announced accounting charges, including a $2.3 billion non-cash special charge for goodwill impairment.
Continued its focus on controlling costs, with mainline cost per available seat mile (CASM), excluding fuel and the above mentioned accounting charges, up 2.6 percent versus the same period in 2007. Mainline CASM for the quarter was up 85.5 percent versus the second quarter of 2007, reflecting a 55.4 percent increase in mainline fuel price per gallon and the significant accounting charges.
Strengthened its cash position by raising $90 million through new financings, asset sales and freeing up $130 million in restricted cash. In addition, the company expects to raise $330 million in cash in the third quarter through aircraft financings and the release of restricted cash, resulting in a total cash balance improvement of approximately $550 million.
Announced further capacity cuts and the retirement of the entire B737 fleet as well as six B747s. In total, United will retire 100 aircraft and will reduce fourth-quarter mainline domestic capacity 15.5 percent to 16.5 percent year-over-year. In conjunction with the capacity reductions, the company expects to reduce its workforce by approximately 7,000 by year-end 2009.
Announced an alliance partnership with Continental Airlines -- a partnership that will create the most comprehensive domestic system by linking networks as well as creating potential for cost savings and operational efficiencies, while simultaneously benefiting customers.