United parent posts Q2 profit on one-time gains

United parent posts Q2 profit on one-time gains
AP
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First Published: Tue, Jul 21 2009. 07 22 PM IST
Updated: Tue, Jul 21 2009. 07 22 PM IST
Atlanta: The parent of United Airlines (UAL) said on Tuesday it is cutting international capacity by an extra 7% during the last four months of this year, as it posted a $28 million second-quarter profit due to fuel hedge gains and other one-time items.
UAL said that the international capacity reductions it is planning starting in September are part of an effort by the Chicago-based airline company to better match supply with demand.
Its shares rose 32 cents, or 9.1%, to $3.83 in premarket trading.
The earnings were equivalent to 19 cents a share in the three months ended 30 June, compared to a loss of $2.74 billion, or $21.57 a share, a year ago.
Excluding one-time items, UAL Corp. said it lost $2.23 a share in the quarter. Analysts surveyed by Thomson Reuters had been expecting a loss of $2.61 a share excluding items.
Revenue fell 25.2%to $4.02 billion from $5.37 billion a year earlier. Analysts had been expecting revenue of $4.04 billion in the latest quarter.
The parent company of USA’s third-largest airline said it ended the quarter with $2.6 billion in unrestricted cash, ahead of its previous projection of $2.5 billion. The company raised an additional $155 million earlier this month through a spare parts financing transaction. That money will be included in its third-quarter figures.
Airlines have been hit hard by falling demand for air travel, especially among business customers.
UAL reported a year-over-year 17.2% decline in second-quarter consolidated passenger unit revenue per available seat mile.
Carriers have been cutting costs and adding new fees or increasing existing ones to weather the downturn. There also has been deep discounting of fares from time to time.
United said it has cut planned capital expenditures to $300 million, a reduction of $150 million from the $450 million the company originally planned for 2009.
For the first half of the year, UAL posted a net loss of $354 million, or $2.44 a share, compared to a loss of $3.29 billion, or $26.52 a share, for the same period a year ago. Six-month revenue fell 23.5% to $7.71 billion, compared to $10.08 billion a year earlier.
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First Published: Tue, Jul 21 2009. 07 22 PM IST