News Column

United Continental Posts Bigger Quarterly Loss

Jan. 24, 2013

Gregory Karp

united continental

United Continental Holdings, the Chicago-based parent of United Airlines, on Thursday said it lost $723 million in 2012, or $2.18 per share.

Excluding special charges of $1.3 billion, mostly related to merging United and Continental airlines, the company earned $589 million, or $1.59 per share, meeting Wall Street analyst expectations.

In the fourth quarter, United lost $620 million, or $1.87 per share.

The airline has been working to win back customers who turned to rival carriers after technology changes it made to unify operations following its 2010 merger hurt service last year.

"While we didn't meet our revenue goals in 2012, we have addressed the integration issues that drove our underperformance," Jim Compton, vice chairman and chief revenue officer, said in a statement.

The world's largest carrier said its quarterly net loss widened to $620 million, or $1.87 a share, from $138 million, or 42 cents a share, a year earlier.

It took charges of $430 million in the quarter, with much of that tied to paying off pension debt and costs for systems integration and training and severance.

Excluding items, United said the 2012 quarterly loss was 58 cents a share, compared with a 61-cent loss expected by analysts on average, according to Thomson Reuters I/B/E/S.

Revenue fell 2.5 percent to $8.7 billion. Passenger revenue per available seat mile, a measure of pricing power and how full planes are, rose 0.6 percent in the quarter.

Operating costs rose 3.2 percent. Although fuel costs edged down 0.3 percent, expenses for salaries and maintenance materials were 4 percent and 9.2 percent higher, respectively.

Superstorm Sandy, which barreled through the U.S. Northeast in late October, reduced revenue by about $140 million and profit by about $85 million in the fourth quarter. The storm caused shutdowns at major New York area airports, including New Jersey's Newark Liberty International where United operates a major hub.

United is the only U.S. carrier operating Boeing 787 planes, which were grounded on Jan. 16 after a series of safety incidents including battery fires. United has six 787s.

Reuters contributed.

Source: (c)2013 Chicago Tribune Distributed by MCT Information Services

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