United Airlines Reports Third-Quarter 2018 Performance

October 16, 2018

CHICAGO, Oct. 16, 2018 /PRNewswire/ -- United Airlines (UAL) today announced its third-quarter 2018 financial results, reporting third-quarter net income of $836 million, diluted earnings per share of $3.06, pre-tax earnings of $1.1 billion and pre-tax margin of 9.6 percent. Tropical storms across the system are estimated to have reduced diluted earnings per share by approximately $0.07. Third-quarter diluted earnings per share increased 42 percent year-over-year. The company recaptured approximately 100 percent of its year-over-year fuel expense increase in the third quarter.

"Our stand-out third-quarter performance, which produced double-digit revenue growth as we more than offset the steep increase in fuel costs, is proof that United is building momentum," said Oscar Munoz, chief executive officer of United Airlines. "Our growth plan has been essential to our success, and we're more confident than ever we'll achieve the ambitious adjusted earnings per share¹ target of $11 to $13 we laid out for 2020."

UAL reported third-quarter adjusted net income of $837 million, adjusted diluted earnings per share of $3.06, adjusted pre-tax earnings of $1.1 billion and adjusted pre-tax margin of 9.7 percent.² Third-quarter adjusted diluted earnings per share increased 36 percent year-over-year.
Consolidated passenger revenue per available seat mile (PRASM) increased 6.1 percent year-over-year, above the high end of the company's third-quarter 2018 guidance range of up 4 percent to 6 percent.
Consolidated unit cost per available seat mile (CASM) increased 6.4 percent year-over-year.
Consolidated CASM, excluding special charges, third-party business expenses, fuel and profit sharing, decreased 0.4 percent year-over-year.
UAL's mid-continent hubs in Chicago, Denver and Houston had year-over-year capacity growth of 9.7 percent in the third quarter and led the system in unit revenue growth performance in the quarter.
UAL now expects full-year 2018 adjusted diluted earnings per share³ to be $8.00 to $8.75. The company currently expects to recapture approximately 90 percent of the estimated $2.5 billion year-over year increase in full-year 2018 fuel expense.

For more information on UAL's fourth-quarter and full-year 2018 guidance, please visit ir.united.com for the company's investor update.

Third-Quarter Highlights

Customer Experience

Introduced a new boarding process at 1,000 gates around the world, designed to reduce customers' stress by spending less time waiting in line and providing them with improved boarding information.
United Airlines MileagePlus loyalty program voted Favorite Frequent-Flyer Program in Trazee Awards.
The United Polaris lounge at Chicago O'Hare International Airport voted Best Business Class Lounge in the United States by the 2018 World Airline Awards from Skytrax.
Debuted United Corporate Preferred, the industry's newest corporate travel program designed to offer top travel benefits to the company's most loyal business customers.
Launched the redesigned united.com homepage, featuring a more personalized digital experience for each customer.

Operations and Employees

In July, UAL had its best consolidated D :00 month of July in history and its highest consolidated load factor month ever.
Carried the most-ever customers to their destinations during the summer.
Consolidated completion factor at UAL's hubs in Houston, Chicago, Los Angeles and Washington Dulles reached third-quarter record levels.
Achieved the top score of 100 percent on the 2018 Disability Equality Index (DEI), a prominent benchmarking metric that rates U.S. companies on their disability inclusion policies and practices, also earning UAL a place on DEI's 2018 "Best Places to Work" list.

Network and Fleet

Announced several new international routes, including year-round nonstop service between Washington Dulles and Tel Aviv, Israel, making UAL the only airline to offer nonstop service between the two cities; daily, year-round service between San Francisco and Amsterdam; and nonstop seasonal summer service between Newark/New York and Naples, Italy, and Newark/New York and Prague, all subject to government approval.
Added 100 flights and more than 10,000 seats daily to 12 of the country's top ski destinations during the 2018/2019 ski season, more than 8,500 seats from U.S. hubs and eight other U.S. cities connecting more customers than ever to Las Vegas for CES 2019, and more than 204,000 total seats from September through November to popular college football towns including Madison, Wisconsin, and Columbia, South Carolina.
Announced orders to purchase 25 new Embraer E-175 and 13 new Boeing 787-9 aircraft.
Took delivery of one Boeing 737 MAX 9 aircraft and two used Boeing 767-300 aircraft.

Community and Environment

Committed to reducing the company's greenhouse gas emissions by 50 percent by 2050, the only U.S. airline to commit to emissions reductions, further strengthening UAL's ambition to be the world's most environmentally conscious airline.
Launched a Crowdrise fundraising campaign to support those affected by Hurricane Florence, Typhoon Mangkhut, flooding in Western Japan, wildfires in California and other disasters.
As part of a previously announced $8 million commitment, announced a $2 million grant to be split between the Community FoodBank of New Jersey, Urban League of Essex County, and Year Up New York, as well as a $1 million grant to First Place for Youth in Los Angeles, and a $1 million grant to the San Francisco Immigrant Legal and Education Network.

Earnings Call

UAL will hold a conference call to discuss third-quarter 2018 financial results and its financial and operational outlook for the fourth quarter and full year of 2018 on Wednesday, October 17, at 9:30 a.m. Central Time /10:30 a.m. Eastern Time. A live, listen-only webcast of the conference call will be available at ir.united.com. The webcast will be available for replay within 24 hours of the conference call and then archived on the website for three months.

About United

United Airlines and United Express operate approximately 4,700 flights a day to 356 airports across five continents. In 2017, United and United Express operated more than 1.6 million flights carrying more than 148 million customers. United is proud to have the world's most comprehensive route network, including U.S. mainland hubs in Chicago, Denver, Houston, Los Angeles, Newark/New York, San Francisco and Washington, D.C. United operates 760 mainline aircraft and the airline's United Express carriers operate 546 regional aircraft. The airline is a founding member of Star Alliance, which provides service to 193 countries via 28 member airlines. For more information, visit united.com, follow @United on Twitter or connect on Facebook. The common stock of United's parent, United Continental Holdings, Inc., is traded on the Nasdaq under the symbol "UAL".

¹Excludes special charges and the mark-to-market impact of equity investments, the nature of which are not determinable at this time. Accordingly, UAL is not providing earnings guidance on a GAAP basis.

²Excludes special charges, the mark-to-market impact of equity investments and imputed interest on certain capitalized leases. Reconciliations of non-GAAP financial measures to the most directly comparable GAAP measures are included in the tables accompanying this release.

³Excludes special charges and the mark-to-market impact of equity investments, the nature of which are not determinable at this time, and imputed interest on certain capitalized leases. Accordingly, UAL is not providing earnings guidance on a GAAP basis.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995:
Certain statements included in this release are forward-looking and thus reflect our current expectations and beliefs with respect to certain current and future events and anticipated financial and operating performance. Such forward-looking statements are and will be subject to many risks and uncertainties relating to our operations and business environment that may cause actual results to differ materially from any future results expressed or implied in such forward-looking statements. Words such as "expects," "will," "plans," "anticipates," "indicates," "believes," "estimates," "forecast," "guidance," "outlook," "goals" and similar expressions are intended to identify forward-looking statements. Additionally, forward-looking statements include statements that do not relate solely to historical facts, such as statements which identify uncertainties or trends, discuss the possible future effects of current known trends or uncertainties, or which indicate that the future effects of known trends or uncertainties cannot be predicted, guaranteed or assured. All forward-looking statements in this release are based upon information available to us on the date of this release. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, changed circumstances or otherwise, except as required by applicable law. Our actual results could differ materially from these forward-looking statements due to numerous factors including, without limitation, the following: general economic conditions (including interest rates, foreign currency exchange rates, investment or credit market conditions, crude oil prices, costs of aircraft fuel and energy refining capacity in relevant markets); economic and political instability and other risks of doing business globally, including political developments that may impact our operations in certain countries; demand for travel and the impact that global economic and political conditions have on customer travel patterns; competitive pressures on pricing and on demand; demand for transportation in the markets in which we operate; our capacity decisions and the capacity decisions of our competitors; the effects of any hostilities, act of war or terrorist attack; the effects of any technology failures or cybersecurity breaches; the impact of regulatory, investigative and legal proceedings and legal compliance risks; disruptions to our regional network; the ability of other air carriers with whom we have alliances or partnerships to provide the services contemplated by the respective arrangements with such carriers; costs associated with any modification or termination of our aircraft orders; potential reputational or other impact from adverse events in our operations, the operations of our regional carriers or the operations of our code share partners; our ability to attract and retain customers; our ability to execute our operational plans and revenue-generating initiatives, including optimizing our revenue; our ability to control our costs, including realizing benefits from our resource optimization efforts, cost reduction initiatives and fleet replacement programs; the impact of any management changes; our ability to cost-effectively hedge against increases in the price of aircraft fuel if we decide to do so; any potential realized or unrealized gains or losses related to any fuel or currency hedging programs; labor costs; our ability to maintain satisfactory labor relations and the results of any collective bargaining agreement process with our union groups; any disruptions to operations due to any potential actions by our labor groups; an outbreak of a disease that affects travel demand or travel behavior; U.S. or foreign governmental legislation, regulation and other actions (including Open Skies agreements and environmental regulations); industry consolidation or changes in airline alliances; our ability to comply with the terms of our various financing arrangements; the costs and availability of financing; our ability to maintain adequate liquidity; the costs and availability of aviation and other insurance; weather conditions; our ability to utilize our net operating losses to offset future taxable income; the impact of changes in tax laws; the success of our investments in airlines in other parts of the world; and other risks and uncertainties set forth under Part I, Item 1A., "Risk Factors," of our Annual Report on Form 10-K for the fiscal year ended December 31, 2017, as well as other risks and uncertainties set forth from time to time in the reports we file with the U.S. Securities and Exchange Commission.

-tables attached-

On January 1, 2018, United Continental Holdings, Inc. ("UAL") adopted Accounting Standards Update No. 2014-09 (Topic 606), Revenue from Contracts with Customers, and Accounting Standards Update No. 2017-07, Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. As such, certain previously reported 2017 figures are adjusted in this report on a basis consistent with the new standards. See the Current Report on Form 8-K filed by UAL with the Securities and Exchange Commission on March 1, 2018 for additional information.

UNITED CONTINENTAL HOLDINGS, INC
STATEMENTS OF CONSOLIDATED OPERATIONS (UNAUDITED) (A)

	Three Months Ended September 30,						% Increase/ (Decrease)		Nine Months Ended September 30,						% Increase/ (Decrease)
(In millions, except per share data)	2018			2017			% Increase/ (Decrease)		2018			2017			% Increase/ (Decrease)
Operating revenue:
Passenger (B)	$	10,120		$	9,069		11.6		$	28,150		$	25,873		8.8
Cargo	296			279			6.1		903			790			14.3
Other operating revenue	587			551			6.5		1,759			1,670			5.3
Total operating revenue	11,003			9,899			11.2		30,812			28,333			8.7

Operating expense:
Salaries and related costs	2,930			2,785			5.2		8,534			8,263			3.3
Aircraft fuel	2,572			1,809			42.2		6,927			5,038			37.5
Regional capacity purchase	663			567			16.9		1,963			1,652			18.8
Landing fees and other rent	596			585			1.9		1,757			1,670			5.2
Depreciation and amortization	564			556			1.4		1,662			1,610			3.2
Aircraft maintenance materials and outside repairs	455			451			0.9		1,333			1,377			(3.2)
Distribution expenses	427			377			13.3		1,162			1,081			7.5
Aircraft rent	109			145			(24.8)		355			476			(25.4)
Special charges (C)	17			50			NM		186			145			NM
Other operating expenses	1,467			1,436			2.2		4,293			4,126			4.0
Total operating expense	9,800			8,761			11.9		28,172			25,438			10.7

Operating income	1,203			1,138			5.7		2,640			2,895			(8.8)

Operating margin	10.9		%	11.5		%	(0.6)	pts.	8.6		%	10.2		%	(1.6)	pts.
Adjusted operating margin (Non-GAAP)	11.1		%	12.0		%	(0.9)	pts.	9.2		%	10.7		%	(1.5)	pts.

Nonoperating income (expense):
Interest expense	(187)			(169)			10.7		(540)			(498)			8.4
Interest capitalized	18			20			(10.0)		51			64			(20.3)
Interest income	28			17			64.7		70			41			70.7
Miscellaneous, net (C)	(1)			(13)			(92.3)		(119)			(82)			45.1
Total nonoperating expense	(142)			(145)			(2.1)		(538)			(475)			13.3

Income before income taxes	1,061			993			6.8		2,102			2,420			(13.1)

Pre-tax margin	9.6		%	10.0		%	(0.4)	pts.	6.8		%	8.5		%	(1.7)	pts.
Adjusted pre-tax margin (Non-GAAP)	9.7		%	10.5		%	(0.8)	pts.	7.7		%	9.1		%	(1.4)	pts.

Income tax expense (E)	225			348			(35.3)		435			855			(49.1)
Net income	$	836		$	645		29.6		$	1,667		$	1,565		6.5

Diluted earnings per share	$	3.06		$	2.15		42.3		$	5.99		$	5.09		17.7
Diluted weighted average shares	273.6			300.6			(9.0)		278.0			307.6			(9.6)

NM Not meaningful

UNITED CONTINENTAL HOLDINGS, INC.
STATISTICS

	Three Months Ended September 30,						% Increase/ (Decrease)		Nine Months Ended September 30,						% Increase/ (Decrease)
	2018			2017			% Increase/ (Decrease)		2018			2017			% Increase/ (Decrease)
Mainline:
Passengers (thousands)	31,157			29,182			6.8		85,348			81,091			5.2
Revenue passenger miles (millions)	56,787			53,515			6.1		154,382			146,252			5.6
Available seat miles (millions)	65,819			63,183			4.2		183,678			176,710			3.9
Cargo ton miles (millions)	851			830			2.5		2,523			2,406			4.9
Passenger revenue per available seat mile (cents)	12.62			11.93			5.8		12.50			12.03			3.9
Average yield per revenue passenger mile (cents)	14.62			14.09			3.8		14.88			14.53			2.4
Aircraft in fleet at end of period	760			751			1.2		760			751			1.2
Average stage length (miles)	1,807			1,825			(1.0)		1,814			1,817			(0.2)
Average daily utilization of each aircraft (hours: minutes)	11:23			10:58			3.8		10:49			10:30			3.0
Average aircraft fuel price per gallon	$	2.29		$	1.68		36.3		$	2.21		$	1.66		33.1
Fuel gallons consumed (millions)	931			909			2.4		2,587			2,537			2.0

Regional:
Passengers (thousands)	11,729			10,120			15.9		33,091			29,563			11.9
Revenue passenger miles (millions)	6,606			5,630			17.3		18,805			16,860			11.5
Available seat miles (millions)	7,862			6,900			13.9		22,682			20,648			9.9
Passenger revenue per available seat mile (cents)	23.10			22.19			4.1		22.86			22.36			2.2
Average yield per revenue passenger mile (cents)	27.49			27.19			1.1		27.57			27.38			0.7
Aircraft in fleet at end of period	546			489			11.7		546			489			11.7
Average stage length (miles)	552			542			1.8		556			558			(0.4)
Average aircraft fuel price per gallon	$	2.43		$	1.81		34.3		$	2.34		$	1.77		32.2
Fuel gallons consumed (millions)	180			156			15.4		514			461			11.5

Consolidated (Mainline and Regional):
Passengers (thousands)	42,886			39,302			9.1		118,439			110,654			7.0
Revenue passenger miles (millions)	63,393			59,145			7.2		173,187			163,112			6.2
Available seat miles (millions)	73,681			70,083			5.1		206,360			197,358			4.6
Passenger load factor:
Consolidated	86.0		%	84.4		%	1.6	pts.	83.9		%	82.6		%	1.3	pts.
Domestic	86.7		%	85.3		%	1.4	pts.	85.7		%	85.2		%	0.5	pts.
International	85.2		%	83.3		%	1.9	pts.	81.6		%	79.5		%	2.1	pts.
Passenger revenue per available seat mile (cents)	13.73			12.94			6.1		13.64			13.11			4.0
Total revenue per available seat mile (cents)	14.93			14.12			5.7		14.93			14.36			4.0
Average yield per revenue passenger mile (cents)	15.96			15.33			4.1		16.25			15.86			2.5
Aircraft in fleet at end of period	1,306			1,240			5.3		1,306			1,240			5.3
Average stage length (miles)	1,454			1,480			(1.8)		1,453			1,470			(1.2)
Average full-time equivalent employees (thousands)	89.0			87.3			1.9		87.1			86.2			1.0
Average aircraft fuel price per gallon	$	2.32		$	1.70		36.5		$	2.23		$	1.68		32.7
Fuel gallons consumed (millions)	1,111			1,065			4.3		3,101			2,998			3.4

Note: See Part II, Item 6, Selected Financial Data, of UAL's Annual Report on Form 10-K for the fiscal year ended December 31, 2017, for definitions of these statistics.

UNITED CONTINENTAL HOLDINGS, INC.
RETURN ON INVESTED CAPITAL (ROIC) - Non-GAAP

ROIC is a non-GAAP financial measure that UAL believes provides useful supplemental information for management and investors by measuring the effectiveness of the company's operations' use of invested capital to generate profits.


(in millions)	Twelve Months Ended September 30, 2018
Net Operating Profit After Tax ("NOPAT")
Pre-tax income	$	2,722
Special charges and MTM losses on equity investments (C):
Impairment of assets	155
MTM losses on equity investments	61
Severance and benefit costs	49
(Gains) losses on sale of assets and other special charges	13
Pre-tax income excluding special charges and MTM losses on equity investments (Non-GAAP)	3,000
add: Interest expense (net of income tax benefit) (a)	707
add: Interest component of capitalized aircraft rent (net of income tax benefit) (a)	243
add: Net interest on pension (net of income tax benefit) (a)	(3)
less: Income taxes paid	(26)
NOPAT (Non-GAAP)	$	3,921


Average Invested Capital (five-quarter average)
Total assets	$	43,697
add: Capitalized aircraft operating leases (b)	4,005
less: Non-interest bearing liabilities (c)	(17,095)
Average invested capital (Non-GAAP)	$	30,607

ROIC (Non-GAAP)	12.8		%

(a)	Income tax benefit measured based on the effective cash tax rate. The effective cash tax rate is calculated by dividing cash taxes paid by pre-tax income excluding special charges. For the twelve months ended September 30, 2018, the effective cash tax rate was 0.9%.
(b)	The purpose of this adjustment is to capitalize the impact of aircraft operating leases. The company uses a multiple of seven times its annual aircraft rent expense to estimate the potential capitalized value and related liability of its aircraft. This is a simplified method used by many rating agencies and financial analysts to assist with the impact of operating leases on financial measures like return on invested capital.
(c)	Non-interest bearing liabilities include advance ticket sales, frequent flyer deferred revenue, deferred income taxes and other non-interest bearing liabilities.

UNITED CONTINENTAL HOLDINGS, INC.
NON-GAAP FINANCIAL RECONCILIATION

(A) UAL evaluates its financial performance utilizing various accounting principles generally accepted in the United States of America (GAAP) and Non-GAAP financial measures, including adjusted operating income (loss), adjusted operating margin, adjusted pre-tax income (loss), adjusted pre-tax margin, adjusted net income (loss), adjusted diluted earnings (loss) per share and CASM, excluding special charges, third-party business expenses, fuel, and profit sharing, among others. UAL believes that adjusting for special charges is useful to investors because special charges are not indicative of UAL's ongoing performance. UAL believes that adjusting for MTM gains and losses on equity investments is useful to investors because those unrealized gains or losses may not ultimately be realized on a cash basis. UAL believes that adjusting for interest expense related to capital leases of Embraer ERJ 145 aircraft is useful to investors because of the accelerated recognition of interest expense.

CASM is a common metric used in the airline industry to measure an airline's cost structure and efficiency. UAL reports CASM excluding special charges, third-party business expenses, fuel and profit sharing. UAL believes that adjusting for special charges is useful to investors because special charges are not indicative of UAL's ongoing performance. UAL also believes that excluding third-party business expenses, such as maintenance, ground handling and catering services for third parties and fuel sales, provides more meaningful disclosure because these expenses are not directly related to UAL's core business. UAL also believes that excluding fuel costs from certain measures is useful to investors because it provides an additional measure of management's performance excluding the effects of a significant cost item over which management has limited influence. UAL excludes profit sharing because this exclusion allows investors to better understand and analyze our recurring cost performance and provides a more meaningful comparison of our core operating costs to the airline industry.

Reconciliations of reported non-GAAP financial measures to the most directly comparable GAAP financial measures are included below.

	Three Months Ended September 30,		% Increase/ (Decrease)	Nine Months Ended September 30,		% Increase/ (Decrease)
	2018	2017	% Increase/ (Decrease)	2018	2017	% Increase/ (Decrease)
CASM Mainline Operations (cents)
Cost per available seat mile (CASM) (GAAP)	12.82	11.98	7.0	13.13	12.43	5.6
Special charges (C)	0.03	0.08	NM	0.10	0.08	NM
Third-party business expenses	0.04	0.05	(20.0)	0.04	0.06	(33.3)
Fuel expense	3.25	2.41	34.9	3.12	2.39	30.5
Profit sharing, including taxes	0.19	0.21	(9.5)	0.14	0.17	(17.6)
CASM, excluding special charges, third-party business expenses, fuel, and profit sharing (Non-GAAP)	9.31	9.23	0.9	9.73	9.73	—

CASM Consolidated Operations (cents)
Cost per available seat mile (CASM) (GAAP)	13.30	12.50	6.4	13.65	12.89	5.9
Special charges (C)	0.02	0.07	NM	0.09	0.08	NM
Third-party business expenses	0.04	0.04	—	0.04	0.05	(20.0)
Fuel expense	3.49	2.58	35.3	3.36	2.55	31.8
Profit sharing, including taxes	0.17	0.19	(10.5)	0.12	0.16	(25.0)
CASM, excluding special charges, third-party business expenses, fuel, and profit sharing (Non-GAAP)	9.58	9.62	(0.4)	10.04	10.05	(0.1)

NM Not Meaningful

UNITED CONTINENTAL HOLDINGS, INC.
NON-GAAP FINANCIAL RECONCILIATION (Continued)

	Three Months Ended September 30,				$ Increase/ (Decrease)		% Increase/ (Decrease)	Nine Months Ended September 30,				$ Increase/ (Decrease)		% Increase/ (Decrease)
(in millions)	2018		2017		$ Increase/ (Decrease)		% Increase/ (Decrease)	2018		2017		$ Increase/ (Decrease)		% Increase/ (Decrease)
Operating expenses (GAAP)	$	9,800	$	8,761	$	1,039	11.9	$	28,172	$	25,438	$	2,734	10.7
Special charges (C)	17		50		(33)		NM	186		145		41		NM
Operating expenses, excluding special charges	9,783		8,711		1,072		12.3	27,986		25,293		2,693		10.6
Adjusted to exclude:
Third-party business expenses	29		33		(4)		(12.1)	89		114		(25)		(21.9)
Fuel expense	2,572		1,809		763		42.2	6,927		5,038		1,889		37.5
Profit sharing, including taxes	127		130		(3)		(2.3)	252		304		(52)		(17.1)
Adjusted operating expenses (Non-GAAP)	$	7,055	$	6,739	$	316	4.7	$	20,718	$	19,837	$	881	4.4

Operating income (GAAP)	$	1,203	$	1,138	$	65	5.7	$	2,640	$	2,895	$	(255)	(8.8)
Adjusted to exclude:
Special charges (C)	17		50		(33)		NM	186		145		41		NM
Adjusted operating income (Non-GAAP)	$	1,220	$	1,188	$	32	2.7	$	2,826	$	3,040	$	(214)	(7.0)

Pre-tax income (GAAP)	$	1,061	$	993	$	68	6.8	$	2,102	$	2,420	$	(318)	(13.1)
Adjusted to exclude:
Special charges (C)	17		50		(33)		NM	186		145		41		NM
MTM (gains) losses on equity investments (C)	(29)		—		(29)		NM	61		—		61		NM
Interest expense on ERJ 145 capital leases (D)	13		—		13		NM	13		—		13		NM
Adjusted pre-tax income (Non-GAAP)	$	1,062	$	1,043	$	19	1.8	$	2,362	$	2,565	$	(203)	(7.9)

Net income (GAAP)	$	836	$	645	$	191	29.6	$	1,667	$	1,565	$	102	6.5
Adjusted to exclude:
Special charges (C)	17		50		(33)		NM	186		145		41		NM
MTM (gains) losses on equity investments (C)	(29)		—		(29)		NM	61		—		61		NM
Interest expense on ERJ 145 capital leases (D)	13		—		13		NM	13		—		13		NM
Income tax expense (benefit) related to adjustments	—		(18)		18		NM	(58)		(52)		(6)		NM
Adjusted net income (Non-GAAP)	$	837	$	677	$	160	23.6	$	1,869	$	1,658	$	211	12.7

Diluted earnings per share (GAAP)	$	3.06	$	2.15	$	0.91	42.3	$	5.99	$	5.09	$	0.90	17.7
Adjusted to exclude:
Special charges (C)	0.06		0.16		(0.10)		NM	0.67		0.47		0.20		NM
MTM (gains) losses on equity investments (C)	(0.11)		—		(0.11)		NM	0.22		—		0.22		NM
Interest expense on ERJ 145 capital leases (D)	0.05		—		0.05		NM	0.05		—		0.05		NM
Income tax expense (benefit) related to adjustments	—		(0.06)		0.06		NM	(0.21)		(0.17)		(0.04)		NM
Adjusted diluted earnings per share (Non-GAAP)	$	3.06	$	2.25	$	0.81	36.0	$	6.72	$	5.39	$	1.33	24.7

NM Not Meaningful

UNITED CONTINENTAL HOLDINGS, INC.
NON-GAAP FINANCIAL RECONCILIATION (Continued)

UAL believes that adjusting capital expenditures for assets acquired through the issuance of debt and capital leases, airport construction financing and excluding fully reimbursable projects is useful to investors in order to appropriately reflect the non-reimbursable funds spent on capital expenditures. UAL also believes that adjusting net cash provided by operating activities for capital expenditures and adjusted capital expenditures is useful to allow investors to evaluate the company's ability to generate cash that is available for debt service or general corporate initiatives.

	Three Months Ended September 30,				Nine Months Ended September 30,
Capital Expenditures (in millions)	2018		2017		2018		2017
Capital expenditures (GAAP)	$	858	$	1,120	$	2,592	$	2,900
Property and equipment acquired through the issuance of debt and capital leases	—		11		139		918
Airport construction financing	—		9		12		41
Fully reimbursable projects	(51)		(58)		(140)		(176)
Adjusted capital expenditures (Non-GAAP)	$	807	$	1,082	$	2,603	$	3,683

Free Cash Flow (in millions)
Net cash provided by operating activities (GAAP)	$	905	$	577	$	5,080	$	2,685
Less capital expenditures	858		1,120		2,592		2,900
Free cash flow, net of financings (Non-GAAP)	$	47	$	(543)	$	2,488	$	(215)

Net cash provided by operating activities (GAAP)	$	905	$	577	$	5,080	$	2,685
Less adjusted capital expenditures (Non-GAAP)	807		1,082		2,603		3,683
Free cash flow (Non-GAAP)	$	98	$	(505)	$	2,477	$	(998)

UNITED CONTINENTAL HOLDINGS, INC.
NOTES (UNAUDITED)

(B) Select passenger revenue information is as follows (in millions):

	3Q 2018 Passenger Revenue (millions)		Passenger Revenue vs. 3Q 2017	PRASM vs. 3Q 2017	Yield vs. 3Q 2017	Available Seat Miles vs. 3Q 2017

Mainline	$	4,489	13.6%	6.8%	5.4%	6.4%
Regional	1,764		18.3%	4.1%	0.8%	13.7%
Domestic	6,253		14.9%	6.7%	5.0%	7.6%

Atlantic	1,933		12.1%	7.1%	1.3%	4.7%
Pacific	1,163		3.4%	5.3%	5.1%	(1.9%)
Latin America	771		(0.8%)	(3.4%)	(1.2%)	2.7%
International	3,867		6.6%	4.5%	2.2%	2.0%

Consolidated	$	10,120	11.6%	6.1%	4.1%	5.1%


Mainline	$	8,304	10.2%	5.8%	3.8%	4.2%
Regional	1,816		18.6%	4.1%	1.1%	13.9%
Consolidated	$	10,120

UNITED CONTINENTAL HOLDINGS, INC.
NOTES (UNAUDITED)

(C) Special charges and MTM gains and losses on equity investments include the following:

	Three Months Ended September 30,				Nine Months Ended September 30,
(In millions)	2018		2017		2018		2017
Operating:
Impairment of assets	$	11	$	15	$	145	$	15

Severance and benefit costs	9		23		34		101
(Gains) losses on sale of assets and other special charges	(3)		12		7		29
Total special charges	17		50		186		145
Nonoperating MTM (gains) losses on equity investments	(29)		—		61		—
Total special charges and MTM (gains) losses on equity investments	(12)		50		247		145
Income tax benefit related to special charges	(3)		(18)		(41)		(52)
Income tax expense (benefit) related to MTM (gains) losses on equity investments	6		—		(14)		—
Total special charges and MTM (gains) losses on equity investments, net of income taxes	$	(9)	$	32	$	192	$	93

Impairment of assets: In May 2018, the Brazil–United States open skies agreement was ratified, which provides air carriers with unrestricted access between the United States and Brazil. The company determined that the approval of the open skies agreement impaired the entire value of its Brazil route authorities because the agreement removes all limitations or reciprocity requirements for flights between the United States and Brazil. Accordingly, in the second quarter of 2018, the company recorded a $105 million special charge ($82 million net of taxes) to write off the entire value of the intangible asset associated with its Brazil routes. This asset is not part of any collateral pledged against any of the company's borrowings. The company continues to maintain its slot assets related to Brazil since airport access is still regulated by slot allocations that are limited by airport facility constraints. For the three and nine months ended September 30, 2018, the company also recorded $11 million ($9 million net of taxes) and $40 million ($31 million net of taxes), respectively, of fair value adjustments related to aircraft purchased off lease, write-off of unexercised aircraft purchase options and other impairments related to certain fleet types and international slots no longer in use.

During the three months ended September 30, 2017, the company recorded a $15 million ($10 million net of taxes) intangible asset impairment charge related to a maintenance service agreement.

Severance and benefit costs: During the three and nine months ended September 30, 2018, the company recorded severance and benefit costs related to a voluntary early-out program for its technicians and related employees represented by the International Brotherhood of Teamsters of $5 million ($4 million net of taxes) and $19 million ($15 million net of taxes), respectively. In the first quarter of 2017, approximately 1,000 technicians and related employees elected to voluntarily separate from the company and will receive a severance payment, with a maximum value of $100,000 per participant, based on years of service, with retirement dates through 2018. Also during the three and nine months ended September 30, 2018, the company recorded other management severance of $4 million ($3 million net of taxes) and $15 million ($12 million net of taxes), respectively.

During the three and nine months ended September 30, 2017, the company recorded $16 million ($10 million net of taxes) and $73 million ($47 million net of taxes), respectively, of severance and benefit costs related to the voluntary early-out program for its technicians and related employees, and $7 million ($5 million net of taxes) and $28 million ($18 million net of taxes), respectively, of management severance.

(Gains) losses on sale of assets and other special charges: During the three and nine months ended September 30, 2018, the company recorded $3 million ($2 million net of taxes) of gains primarily related to the sale of aircraft engines and $7 million ($5 million net of taxes) of losses primarily related to contract termination of regional aircraft operations in Guam, respectively.

During the three months ended September 30, 2017, the company recorded $12 million ($7 million net of taxes) of charges primarily related to damages from tropical storms. During the nine months ended September 30, 2017, in addition to the $12 million of third-quarter charges, the company recorded $17 million ($11 million net of taxes) of charges primarily associated with aircraft gains and losses.

MTM gains and losses on equity investments: During the three and nine months ended September 30, 2018, the company recorded gains of $29 million ($23 million net of taxes) and losses of $61 million ($47 million net of taxes), respectively, for the change in market value of certain of its equity investments. For equity investments subject to MTM accounting, the company records gains and losses to Nonoperating income (expense): Miscellaneous, net in its statements of consolidated operations.

(D) Interest expense related to capital leases of Embraer ERJ 145 aircraft

During the third quarter of 2018, United entered into an agreement with the lessor of 54 Embraer ERJ 145 aircraft to purchase those aircraft in 2019. The provisions of the new lease agreement resulted in a change in accounting classification of these new leases from operating leases to capital leases up until the purchase date. The company recognized $13 million of additional interest expense in the third quarter as a result of this change.

(E) Effective tax rate

The company's effective tax rate for the three and nine months ended September 30, 2018 was 21.2% and 20.7%, respectively, and the effective tax rate for the three and nine months ended September 30, 2017 was 35.0% and 35.3%, respectively. The effective tax rate represents a blend of federal, state and foreign taxes and included the impact of certain nondeductible items. The effective tax rate for the three and nine months ended September 30, 2018 also reflects the reduced federal corporate income tax rate as a result of the enactment of the Tax Cuts and Jobs Act (the "Tax Act") in December 2017 and the impact of a change in the company's mix of domestic and foreign earnings. The company continues to analyze the different aspects of the Tax Act which could potentially affect the provisional estimates that were recorded at December 31, 2017.

SOURCE United Airlines

For further information: United Airlines Worldwide Media Relations, +1-872-825-8640, media.relations@united.com

United Airlines Names Bryan Quigley Senior Vice President - Flight Operations

January 18, 2019

CHICAGO, Jan. 18, 2019 /PRNewswire/ -- United Airlines (UAL) today announced Bryan Quigley has been named senior vice president of flight operations. Quigley will be responsible for overseeing United's 12,500 pilots and will serve as the airline's FAA certificate director of operations. Quigley will replace Howard Attarian who is retiring after more than a decade of leadership at United.

Quigley, who joined United in 1995, has held several leadership positions throughout United. He most recently was the vice president of the company's San Francisco hub. Quigley also served as chief pilot and led the team in charge of the integration of policies and procedures following the merger of United and Continental.

"Bryan is an exceptional leader both in and out of the flight deck. He has developed a deep understanding of the entire airline after leading our San Francisco hub and I believe he will do great work as the leader of our pilots," said Executive Vice President and Chief Operations Officer Greg Hart.

In addition to his time at United, Quigley spent 26 years in the United States Navy, serving as a U.S. naval aviator.

Attarian retires after more than 40 years in aviation. In addition to his time at United, he spent more than 23 years as a pilot for Northwest Airlines and held several leadership positions with the Air Line Pilots Association. Attarian also served in the United States Air Force and was a demonstration pilot with the U.S. Air Force Thunderbirds.

"Over the past five years, Howard has worked tirelessly to develop the best group of aviators in the industry. We will forever be grateful and wish him the best as he enters the next chapter of his life," said Hart.

Quigley holds a bachelor of science degree in Business Administration from Appalachian State University and has completed the Executive Scholar Program from the Kellogg School of Business at Northwestern University.

Matt Miller, current vice president of international will replace Quigley as vice president of the San Francisco hub.

About United

United Airlines and United Express operate approximately 4,800 flights a day to 353 airports across five continents. In 2018, United and United Express operated more than 1.7 million flights carrying more than 158 million customers. United is proud to have the world's most comprehensive route network, including U.S. mainland hubs in Chicago, Denver, Houston, Los Angeles, Newark/New York, San Francisco and Washington, D.C. United operates 770 mainline aircraft and the airline's United Express carriers operate 559 regional aircraft. The airline is a founding member of Star Alliance, which provides service to 193 countries via 28 member airlines. For more information, visit united.com, follow @United on Twitter or connect on Facebook. The common stock of United's parent, United Continental Holdings, Inc., is traded on the Nasdaq under the symbol "UAL".

SOURCE United Airlines

For further information: United Airlines Worldwide Media Relations, +1-872-825-8640, media.relations@united.com

United Airlines Reports Full-Year and Fourth-Quarter 2018 Performance

January 15, 2019

CHICAGO, Jan. 15, 2019 /PRNewswire/ -- In a departure from industry trends, United (UAL) announced today that its fourth-quarter unit revenue came in at the high end of its guidance range and also exceeded its full-year adjusted diluted earnings per share target laid out last January. UAL reported full-year net income of $2.1 billion, diluted earnings per share of $7.70 (a 9.1 percent increase year-over-year), pre-tax earnings of $2.7 billion and pre-tax margin of 6.4 percent. UAL reported adjusted full-year net income of $2.5 billion, adjusted pre-tax earnings of $3.2 billion and adjusted pre-tax margin of 7.7 percent.¹UAL increased its full-year 2018 adjusted diluted earnings per share outlook three times during the year despite a $2.4 billion year-over-year headwind from fuel. Full-year adjusted diluted earnings per share increased 33.5 percent year-over-year to $9.13, above the high end of the company's most recent guidance range.¹

"United's financial performance is a testament to the successful implementation of the first year of our strategic plan and to the record-setting operational performance powered by the more than 90,000 airline professionals who work at United," said Oscar Munoz, chief executive officer of United Airlines. "United delivered proof, not just promises in 2018 - even in the face of significant headwinds from higher than expected fuel costs. It's why I couldn't be more proud of our winning culture and customer-focused team and continue to be enthusiastic about United's bright future."

For 2019, UAL expects adjusted diluted earnings per share to again grow year-over-year to between $10.00 to $12.00.²

UAL reported fourth-quarter net income of $462 million, diluted earnings per share of $1.70, pre-tax earnings of $556 million and pre-tax margin of 5.3 percent.
UAL reported fourth-quarter adjusted net income of $657 million, adjusted diluted earnings per share of $2.41 and adjusted pre-tax earnings of $814 million.
UAL reported fourth-quarter adjusted pre-tax margin of 7.8 percent,¹ expanding margin on an adjusted basis of 0.9 points versus the fourth-quarter of 2017.
UAL recovered 98% percent of the year-over-year increase in fuel prices in 2018.
Consolidated fourth-quarter passenger revenue per available seat mile (PRASM) increased 5 percent year-over-year, at the high end of the company's fourth-quarter 2018 guidance range.
Consolidated fourth-quarter unit cost per available seat mile (CASM) increased 7.0 percent year-over-year.
Consolidated fourth-quarter CASM, excluding special charges, third-party business expenses, fuel and profit sharing, decreased 0.7 percent year-over-year.
Employees earned $334 million in profit sharing for 2018.

For more information on UAL's first-quarter and full-year 2019 guidance, please visit ir.united.com for the company's investor update.

2018 Highlights

Record-Setting Operational Performance³

Set new UAL records by flying the most revenue passengers ever, operating the most mainline departures and achieving the fewest cancellations ever in a year, resulting in more UAL customers departing on-time in 2018 than ever before.
For the year, achieved the best completion rate in company history with more than 1.7 million flights.
In 2018, achieved the best ever company STAR performance (first departures of the day), with nearly 250,000 flights leaving on time.
In the fourth quarter, the company achieved top-tier performance in on-time departures among its largest competitors. For the December holiday season, UAL had its best-ever on-time departure performance while flying the most revenue customers it had ever flown during the holiday period.

Customer Experience

Opened three new United Polaris lounges located in San Francisco International Airport, Newark Liberty International Airport and Houston's George Bush Intercontinental Airport.
Announced UAL's newest premium seating, United® Premium Plus, which will provide more space, comfort and amenities on select international flights starting later this year.
Introduced a new boarding process designed to reduce customers' stress by reducing time spent waiting in line and providing them with improved boarding information.
Expanded personal device entertainment option to all aircraft, providing at least one free entertainment option on all Wi-Fi equipped aircraft.
MileagePlus loyalty program voted Best Overall Frequent-Flyer Program in the world for the 15th consecutive year by readers of Global Traveler, and voted Favorite Frequent-Flyer Program in the Trazee Awards.

Employees

Employees earned incentive payments totaling approximately $14 million for achieving operational performance goals in the quarter, marking a full year of earned incentive payments totaling $55 million.
Introduced and trained over 90,000 team members on UAL's new customer service decision framework, the core4, which focuses on the principles of safe, caring, dependable and efficient.
Deployed 6,000 iPads to maintenance employees, improving reliability and efficiency.
Unveiled a state-of-the-art flight training center in Denver, Colorado - the largest in the world and home to the company's more than 30 full flight simulators representing all of UAL's fleet types.
Successfully completed the full implementation of the flight attendant joint collective bargaining agreement, allowing the company to operate more efficiently and reliably.
Achieved the top score of 100 percent on the 2018 Disability Equality Index (DEI), a prominent benchmarking metric that rates U.S. companies on their disability inclusion policies and practices, also earning UAL a place on DEI's 2018 "Best Places to Work" list.
Received "Best-of-the-Best" Award from the National LGBT Chamber of Commerce and National Business Inclusion Consortium for commitment to diversity and inclusion across all communities.

Network

Introduced 93 new routes, adding more flights in 2018 than any other U.S. airline.
Announced new international service including Washington-Dulles to Tel Aviv, Israel; San Francisco to Amsterdam, Netherlands; Newark/New York to Naples, Italy; as well as Newark/New York to Prague, Czech Republic and Denver to Frankfurt, Germany, all subject to government approval.
Launched several exciting new international routes including Houston to Sydney, San Francisco to Tahiti and Denver to London.
Announced schedule expansion at East Coast hubs in Newark/New York and Washington-Dulles to offer more nonstop flights to destinations popular with New York-area customers while reallocating largely connecting passenger flights to Washington-Dulles.
Announced a joint business agreement with Compañía Panameña de Aviación S.A. (Copa), Aerovías del Continente Americano S.A. (Avianca) and many of Avianca's affiliates, pending government approval.

Fleet

Took delivery of 21 new Boeing aircraft, including four 777-300ER, four 787-9, three 787-10 and ten 737 MAX 9 aircraft.
In December 2018, ordered an additional four Boeing 777-300ER aircraft and 24 737 MAX aircraft.

Community and Environment

Pledged to reduce the company's greenhouse gas emissions by 50 percent by 2050, the only U.S. airline to commit to emissions reductions, further strengthening UAL's ambition to be the world's most environmentally conscious airline.
Announced a total of $8 million in grants to benefit organizations in each of UAL's domestic hub communities.
Announced new global partnership with the Special Olympics and flew hundreds of Team USA Olympic and Paralympic Winter Games 2018 athletes, coaches and family members to PyeongChang, South Korea, continuing the 38-year relationship between UAL and the United States Olympic Committee.
Ranked No. 1 among global carriers in Newsweek's 2017 Global 500 Green Rankings, one of the most recognized environmental performance assessments of the world's largest publicly traded companies.
Launched a Crowdrise fundraising campaign to support those affected by Hurricane Florence, Typhoon Mangkhut, flooding in Western Japan, wildfires in California and other disasters.

Earnings Call

UAL will hold a conference call to discuss its fourth-quarter and full-year 2018 financial results and its financial and operational outlook for the first quarter and full year of 2019 on Wednesday, January 16, at 9:30 a.m. Central time /10:30 a.m. Eastern time. A live, listen-only webcast of the conference call will be available at ir.united.com. The webcast will be available for replay within 24 hours of the conference call and then archived on the website for three months.

About United

¹Adjusted pre-tax earnings and adjusted pre-tax margin exclude special charges, the mark-to-market ("MTM") impact of financial instruments and imputed interest on certain capitalized leases. Adjusted net income and adjusted diluted earnings per share exclude special charges, the MTM impact of financial instruments, imputed interest on certain capitalized leases and certain tax adjustments. Reconciliations of non-GAAP financial measures to the most directly comparable GAAP measures are included in the tables accompanying this release.

² Excludes special charges and the MTM impact of financial instruments, the nature of which are not determinable at this time, and imputed interest on certain capitalized leases. Accordingly, UAL is not providing earnings guidance on a GAAP basis.

³ Company history defined as post-2010 merger; company records measured from 2010 merger.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: Certain statements included in this release are forward-looking and thus reflect our current expectations and beliefs with respect to certain current and future events and anticipated financial and operating performance. Such forward-looking statements are and will be subject to many risks and uncertainties relating to our operations and business environment that may cause actual results to differ materially from any future results expressed or implied in such forward-looking statements. Words such as "expects," "will," "plans," "anticipates," "indicates," "believes," "estimates," "forecast," "guidance," "outlook," "goals" and similar expressions are intended to identify forward-looking statements. Additionally, forward-looking statements include statements that do not relate solely to historical facts, such as statements which identify uncertainties or trends, discuss the possible future effects of current known trends or uncertainties, or which indicate that the future effects of known trends or uncertainties cannot be predicted, guaranteed or assured. All forward-looking statements in this release are based upon information available to us on the date of this release. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, changed circumstances or otherwise, except as required by applicable law. Our actual results could differ materially from these forward-looking statements due to numerous factors including, without limitation, the following: general economic conditions (including interest rates, foreign currency exchange rates, investment or credit market conditions, crude oil prices, costs of aircraft fuel and energy refining capacity in relevant markets); economic and political instability and other risks of doing business globally, including political developments that may impact our operations in certain countries; demand for travel and the impact that global economic and political conditions have on customer travel patterns; competitive pressures on pricing and on demand; demand for transportation in the markets in which we operate; our capacity decisions and the capacity decisions of our competitors; the effects of any hostilities, act of war or terrorist attack; the effects of any technology failures or cybersecurity breaches; the impact of regulatory, investigative and legal proceedings and legal compliance risks; disruptions to our regional network; the ability of other air carriers with whom we have alliances or partnerships to provide the services contemplated by the respective arrangements with such carriers; costs associated with any modification or termination of our aircraft orders; potential reputational or other impact from adverse events in our operations, the operations of our regional carriers, the operations of our code share partners or the aircraft operated by another airline of the same model as operated by us, our regional carriers or our code share partners; our ability to attract and retain customers; our ability to execute our operational plans and revenue-generating initiatives, including optimizing our revenue; our ability to control our costs, including realizing benefits from our resource optimization efforts, cost reduction initiatives and fleet replacement programs; the impact of any management changes; our ability to cost-effectively hedge against increases in the price of aircraft fuel if we decide to do so; any potential realized or unrealized gains or losses related to any fuel or currency hedging programs; labor costs; our ability to maintain satisfactory labor relations and the results of any collective bargaining agreement process with our union groups; any disruptions to operations due to any potential actions by our labor groups; an outbreak of a disease that affects travel demand or travel behavior; U.S. or foreign governmental legislation, regulation and other actions (including Open Skies agreements and environmental regulations); industry consolidation or changes in airline alliances; our ability to comply with the terms of our various financing arrangements; the costs and availability of financing; our ability to maintain adequate liquidity; the costs and availability of aviation and other insurance; weather conditions; our ability to utilize our net operating losses to offset future taxable income; the impact of changes in tax laws; the success of our investments in airlines in other parts of the world; and other risks and uncertainties set forth under Part I, Item 1A., "Risk Factors," of our Annual Report on Form 10-K for the fiscal year ended December 31, 2017, as well as other risks and uncertainties set forth from time to time in the reports we file with the U.S. Securities and Exchange Commission.

-tables attached-

UNITED CONTINENTAL HOLDINGS, INC.
STATEMENTS OF CONSOLIDATED OPERATIONS (UNAUDITED)

	Three Months Ended December 31,						%		Full Year Ended December 31,						%
(In millions, except per share data)	2018			2017			Increase/ Decrease)		2018			2017			Increase/ Decrease)
Operating revenue:
Passenger	$	9,556		$	8,587		11.3		$	37,706		$	34,460		9.4
Cargo	334			324			3.1		1,237			1,114			11.0
Other operating revenue	601			540			11.3		2,360			2,210			6.8
Total operating revenue	10,491			9,451			11.0		41,303			37,784			9.3

Operating expense:
Salaries and related costs	2,924			2,678			9.2		11,458			10,941			4.7
Aircraft fuel	2,380			1,875			26.9		9,307			6,913			34.6
Regional capacity purchase	638			580			10.0		2,601			2,232			16.5
Landing fees and other rent	602			570			5.6		2,359			2,240			5.3
Depreciation and amortization	578			539			7.2		2,240			2,149			4.2
Aircraft maintenance materials and outside repairs	434			479			(9.4)		1,767			1,856			(4.8)
Distribution expenses	396			354			11.9		1,558			1,435			8.6
Aircraft rent	78			145			(46.2)		433			621			(30.3)
Special charges (B)	301			31			NM		487			176			NM
Other operating expenses	1,508			1,424			5.9		5,801			5,550			4.5
Total operating expense	9,839			8,675			13.4		38,011			34,113			11.4

Operating income	652			776			(16.0)		3,292			3,671			(10.3)

Operating margin	6.2		%	8.2		%	(2.0)	pts.	8.0		%	9.7		%	(1.7)	pts.
Adjusted operating margin (Non-GAAP) (A)	9.1		%	8.5		%	0.6	pts.	9.1		%	10.2		%	(1.1)	pts.

Nonoperating income (expense):
Interest expense	(189)			(173)			9.2		(729)			(671)			8.6
Interest capitalized	19			20			(5.0)		70			84			(16.7)
Interest income	31			16			93.8		101			57			77.2
Miscellaneous, net (B)	43			(19)			NM		(76)			(101)			(24.8)
Total nonoperating expense	(96)			(156)			(38.5)		(634)			(631)			0.5

Income before income taxes	556			620			(10.3)		2,658			3,040			(12.6)

Pre-tax margin	5.3		%	6.6		%	(1.3)	pts.	6.4		%	8.0		%	(1.6)	pts.
Adjusted pre-tax margin (Non-GAAP) (A)	7.8		%	6.9		%	0.9	pts.	7.7		%	8.5		%	(0.8)	pts.

Income tax expense (D)	94			41			129.3		529			896			(41.0)
Net income	$	462		$	579		(20.2)		$	2,129		$	2,144		(0.7)

Diluted earnings per share	$	1.70		$	1.98		(14.1)		$	7.70		$	7.06		9.1
Diluted weighted average shares	272.7			291.8			(6.5)		276.7			303.6			(8.9)

NM Not meaningful

UNITED CONTINENTAL HOLDINGS, INC.
SELECT PASSENGER REVENUE INFORMATION AND STATISTICS

Select passenger revenue information is as follows:

	4Q 2018 Passenger Revenue (millions)		Passenger Revenue vs. 4Q 2017	PRASM vs. 4Q 2017	Yield vs. 4Q 2017	Available Seat Miles vs. 4Q 2017
Domestic	6,088		12.8%	6.0%	6.7%	6.4%

Atlantic	1,535		9.6%	1.6%	(5.0%)	8.0%
Pacific	1,139		8.8%	4.5%	3.2%	4.0%
Latin America	794		7.2%	3.8%	1.1%	3.1%
International	3,468		8.8%	3.2%	(0.5%)	5.4%

Consolidated	$	9,556	11.3%	5.0%	3.8%	6.0%

Select statistics are as follows:

	Three Months Ended December 31,						% Increase/ (Decrease)		Full Year Ended December 31,						% Increase/ (Decrease)
	2018			2017					2018			2017
Passengers (thousands)	39,891			37,413			6.6		158,330			148,067			6.9
Revenue passenger miles (millions)	56,968			53,149			7.2		230,155			216,261			6.4
Available seat miles (millions)	68,902			65,028			6.0		275,262			262,386			4.9
Passenger load factor:
Consolidated	82.7		%	81.7		%	1.0	pt.	83.6		%	82.4		%	1.2	pts.
Domestic	84.6		%	85.2		%	(0.6)	pts.	85.4		%	85.2		%	0.2	pts.
International	80.1		%	77.2		%	2.9	pts.	81.3		%	78.9		%	2.4	pts.
Passenger revenue per available seat mile (cents)	13.87			13.21			5.0		13.70			13.13			4.3
Total revenue per available seat mile (cents)	15.23			14.53			4.8		15.00			14.40			4.2
Average yield per revenue passenger mile (cents)	16.77			16.16			3.8		16.38			15.93			2.8
Aircraft in fleet at end of period	1,329			1,262			5.3		1,329			1,262			5.3
Average stage length (miles)	1,426			1,431			(0.3)		1,446			1,460			(1.0)
Average full-time equivalent employees (thousands)	87.3			85.6			2.0		86.6			86.0			0.7
Average aircraft fuel price per gallon	$	2.30		$	1.91		20.4		$	2.25		$	1.74		29.3
Fuel gallons consumed (millions)	1,036			980			5.7		4,137			3,978			4.0

Note: See Part II, Item 6, Selected Financial Data, of UAL's Annual Report on Form 10-K for the fiscal year ended December 31, 2017, for definitions of these statistics.

UNITED CONTINENTAL HOLDINGS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(In millions)	December 31, 2018		December 31, 2017
ASSETS
Current assets:
Cash and cash equivalents	$	1,694	$	1,482
Short-term investments	2,256		2,316
Receivables, net	1,346		1,340
Aircraft fuel, spare parts and supplies, net	985		924
Prepaid expenses and other	913		1,071
Total current assets	7,194		7,133

Total operating property and equipment, net	28,329		26,208

Other assets:
Goodwill	4,523		4,523
Intangibles, net	3,159		3,539
Restricted cash	105		91
Loans to others, net	496		46
Investments in affiliates and other, net	966		806
Total other assets	9,249		9,005
Total assets	$	44,772	$	42,346

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Advance ticket sales	$	4,381	$	3,940
Accounts payable	2,363		2,196
Frequent flyer deferred revenue	2,286		2,192
Accrued salaries and benefits	2,184		2,166
Current maturities of long-term debt and capital leases	1,379		1,693
Other	600		576
Total current liabilities	13,193		12,763

Other liabilities and deferred credits:
Long-term debt and capital leases	13,349		12,699
Frequent flyer deferred revenue	2,719		2,591
Postretirement benefit liability	1,295		1,602
Pension liability	1,576		1,921
Deferred income taxes	814		204
Other	1,831		1,832
Total other liabilities and deferred credits	21,584		20,849

Commitments and contingencies

Stockholders' equity	9,995		8,734
Total liabilities and stockholders' equity	$	44,772	$	42,346

UNITED CONTINENTAL HOLDINGS, INC.
CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS (UNAUDITED)

(In millions)	Full Year Ended December 31,
	2018		2017
Cash Flows from Operating Activities:
Net cash provided by operating activities	$	6,181	$	3,413

Cash Flows from Investing Activities:
Capital expenditures	(4,177)		(3,998)
Purchases of short-term and other investments	(2,552)		(3,241)
Proceeds from sale of short-term and other investments	2,616		3,177
Loans made to others	(456)		—
Investment in affiliates	(139)		—
Other, net	145		132
Net cash used in investing activities	(4,563)		(3,930)

Cash Flows from Financing Activities:
Proceeds from issuance of long-term debt and airport construction financing	1,740		2,765
Repurchases of common stock	(1,235)		(1,844)
Payments of long-term debt	(1,727)		(901)
Principal payments under capital leases	(134)		(124)
Other, net	(54)		(91)
Net cash used in financing activities	(1,410)		(195)
Net increase (decrease) in cash, cash equivalents and restricted cash	208		(712)
Cash, cash equivalents and restricted cash at beginning of the year	1,591		2,303
Cash, cash equivalents and restricted cash at end of the year (a)	$	1,799	$	1,591

Investing and Financing Activities Not Affecting Cash:
Property and equipment acquired through the issuance of debt and capital leases	$	174	$	935
Debt associated with termination of a maintenance service agreement	163		—
Equity interest in Republic Airways Holdings, Inc. received in consideration for bankruptcy claims	—		92
Airport construction financing	12		42
Operating lease conversions to capital lease	52		—

(a) The following table provides a reconciliation of cash, cash equivalents and restricted cash to amounts reported within the consolidated balance sheet:

Reconciliation of cash, cash equivalents and restricted cash:
Current assets:
Cash and cash equivalents	$	1,694	$	1,482
Restricted cash included in Prepaid expenses and other	—		18
Other assets:
Restricted cash	105		91
Total cash, cash equivalents and restricted cash	$	1,799	$	1,591

UNITED CONTINENTAL HOLDINGS, INC.
RETURN ON INVESTED CAPITAL (ROIC) - Non-GAAP

ROIC is a non-GAAP financial measure that UAL believes provides useful supplemental information for management and investors by measuring the effectiveness of the company's operations' use of invested capital to generate profits.

(in millions)	Twelve Months Ended December 31, 2018
Net Operating Profit After Tax ("NOPAT")
Pre-tax income	$	2,658
Special charges and MTM losses on financial instruments (B):
Impairment of assets	377
Termination of a maintenance service agreement	64
Severance and benefit costs	41
MTM losses on financial instruments	5
(Gains) losses on sale of assets and other special charges	5
Pre-tax income excluding special charges and MTM losses on financial instruments (Non-GAAP)	3,150
add: Interest expense (net of income tax benefit) (a)	725
add: Interest component of capitalized aircraft rent (net of income tax benefit) (a)	211
add: Net interest on pension (net of income tax benefit) (a)	(16)
less: Income taxes paid	(19)
NOPAT (Non-GAAP)	$	4,051


Average Invested Capital (five-quarter average)
Total assets	$	44,133
add: Capitalized aircraft operating leases (b)	3,723
less: Non-interest bearing liabilities (c)	(17,224)
Average invested capital (Non-GAAP)	$	30,632

ROIC (Non-GAAP)	13.2		%


(a)	Income tax benefit measured based on the effective cash tax rate. The effective cash tax rate is calculated by dividing cash taxes paid by pre-tax income excluding special charges. For the twelve months ended December 31, 2018, the effective cash tax rate was 0.6%.
(b)	The purpose of this adjustment is to capitalize the impact of aircraft operating leases. The company uses a multiple of seven times its annual aircraft rent expense to estimate the potential capitalized value and related liability of its aircraft. This is a simplified method used by many rating agencies and financial analysts to assess the impact of operating leases on financial measures like return on invested capital.
(c)	Non-interest bearing liabilities include advance ticket sales, frequent flyer deferred revenue, deferred income taxes and other non-interest bearing liabilities.

UNITED CONTINENTAL HOLDINGS, INC.
NON-GAAP FINANCIAL RECONCILIATION

(A) UAL evaluates its financial performance utilizing various accounting principles generally accepted in the United States of America (GAAP) and Non-GAAP financial measures, including adjusted operating income (loss), adjusted operating margin, adjusted pre-tax income (loss), adjusted pre-tax margin, adjusted net income (loss), adjusted diluted earnings (loss) per share and CASM, excluding special charges, third-party business expenses, fuel, and profit sharing, among others. UAL believes that adjusting for special charges is useful to investors because special charges are not indicative of UAL's ongoing performance. UAL believes that adjusting for MTM gains and losses on financial instruments is useful to investors because those unrealized gains or losses may not ultimately be realized on a cash basis. UAL believes that adjusting for interest expense related to capital leases of Embraer ERJ 145 aircraft is useful to investors because of the accelerated recognition of interest expense.

CASM is a common metric used in the airline industry to measure an airline's cost structure and efficiency. UAL reports CASM excluding special charges, third-party business expenses, fuel and profit sharing. UAL believes that adjusting for special charges is useful to investors because special charges are not indicative of UAL's ongoing performance. UAL also believes that excluding third-party business expenses, such as maintenance, ground handling and catering services for third parties and fuel sales, provides more meaningful disclosure because these expenses are not directly related to UAL's core business. UAL also believes that excluding fuel costs from certain measures is useful to investors because it provides an additional measure of management's performance excluding the effects of a significant cost item over which management has limited influence. UAL excludes profit sharing because this exclusion allows investors to better understand and analyze our operating cost performance and provides a more meaningful comparison of our core operating costs to the airline industry.

Reconciliations of reported non-GAAP financial measures to the most directly comparable GAAP financial measures are included below.

	Three Months Ended December 31,		% Increase/	Full Year Ended December 31,		% Increase/
	2018	2017	(Decrease)	2018	2017	(Decrease)
CASM (cents)
Cost per available seat mile (CASM) (GAAP)	14.28	13.34	7.0	13.81	13.00	6.2
Special charges (B)	0.44	0.04	NM	0.18	0.07	NM
Third-party business expenses	0.04	0.06	(33.3)	0.04	0.05	(20.0)
Fuel expense	3.46	2.88	20.1	3.38	2.64	28.0
Profit sharing, including taxes	0.12	0.07	71.4	0.12	0.13	(7.7)
CASM, excluding special charges, third-party business expenses, fuel, and profit sharing (Non-GAAP)	10.22	10.29	(0.7)	10.09	10.11	(0.2)

NM Not Meaningful

UNITED CONTINENTAL HOLDINGS, INC.
NON-GAAP FINANCIAL RECONCILIATION (Continued)

	Three Months Ended December 31,				$ Increase/		% Increase/	Full Year Ended December 31,				$ Increase/		% Increase/
(in millions)	2018		2017		(Decrease)		(Decrease)	2018		2017		(Decrease)		(Decrease)
Operating expenses (GAAP)	$	9,839	$	8,675	$	1,164	13.4	$	38,011	$	34,113	$	3,898	11.4
Special charges (B)	301		31		270		NM	487		176		311		NM
Operating expenses, excluding special charges	9,538		8,644		894		10.3	37,524		33,937		3,587		10.6
Adjusted to exclude:
Third-party business expenses	32		31		1		3.2	121		145		(24)		(16.6)
Fuel expense	2,380		1,875		505		26.9	9,307		6,913		2,394		34.6
Profit sharing, including taxes	82		45		37		82.2	334		349		(15)		(4.3)
Adjusted operating expenses (Non-GAAP)	$	7,044	$	6,693	$	351	5.2	$	27,762	$	26,530	$	1,232	4.6

Operating income (GAAP)	$	652	$	776	$	(124)	(16.0)	$	3,292	$	3,671	$	(379)	(10.3)
Adjusted to exclude:
Special charges (B)	301		31		270		NM	487		176		311		NM
Adjusted operating income (Non-GAAP)	$	953	$	807	$	146	18.1	$	3,779	$	3,847	$	(68)	(1.8)

Pre-tax income (GAAP)	$	556	$	620	$	(64)	(10.3)	$	2,658	$	3,040	$	(382)	(12.6)
Adjusted to exclude:
Special charges (B)	301		31		270		NM	487		176		311		NM
MTM (gains) losses on financial instruments (B)	(56)		—		(56)		NM	5		—		5		NM
Interest expense on ERJ 145 capital leases (C)	13		—		13		NM	26		—		26		NM
Adjusted pre-tax income (Non-GAAP)	$	814	$	651	$	163	25.0	$	3,176	$	3,216	$	(40)	(1.2)

Net income (GAAP)	$	462	$	579	$	(117)	(20.2)	$	2,129	$	2,144	$	(15.0)	(0.7)
Adjusted to exclude:
Special charges (B)	301		31		270		NM	487		176		311		NM
MTM (gains) losses on financial instruments (B)	(56)		—		(56)		NM	5		—		5		NM
Interest expense on ERJ 145 capital leases (C)	13		—		13		NM	26		—		26		NM
Income tax benefit related to adjustments above	(58)		(11)		(47)		NM	(116)		(63)		(53)		NM
Special income tax adjustments (D)	(5)		(179)		174		NM	(5)		(179)		174		NM
Adjusted net income (Non-GAAP)	$	657	$	420	$	237	56.4	$	2,526	$	2,078	$	448	21.6

Diluted earnings per share (GAAP)	$	1.70	$	1.98	$	(0.28)	(14.1)	$	7.70	$	7.06	$	0.64	9.1
Adjusted to exclude:
Special charges (B)	1.10		0.11		0.99		NM	1.76		0.58		1.18		NM
MTM (gains) losses on financial instruments (B)	(0.21)		—		(0.21)		NM	0.02		—		0.02		NM
Interest expense on ERJ 145 capital leases (C)	0.05		—		0.05		NM	0.09		—		0.09		NM
Income tax benefit related to adjustments	(0.21)		(0.04)		(0.17)		NM	(0.42)		(0.21)		(0.21)		NM
Special income tax adjustments (D)	(0.02)		(0.61)		0.59		NM	(0.02)		(0.59)		0.57		NM
Adjusted diluted earnings per share (Non-GAAP)	$	2.41	$	1.44	$	0.97	67.4	$	9.13	$	6.84	$	2.29	33.5

NM Not Meaningful

UNITED CONTINENTAL HOLDINGS, INC.
NON-GAAP FINANCIAL RECONCILIATION (Continued)

UAL believes that adjusting capital expenditures for assets acquired through the issuance of debt and capital leases, airport construction financing and excluding fully reimbursable projects is useful to investors in order to appropriately reflect the non-reimbursable funds spent on capital expenditures. UAL also believes that adjusting net cash provided by operating activities for capital expenditures and adjusted capital expenditures is useful to allow investors to evaluate the company's ability to generate cash that is available for debt service or general corporate initiatives.

	Three Months Ended December 31,				Full Year Ended December 31,
Capital Expenditures (in millions)	2018		2017		2018		2017
Capital expenditures (GAAP)	$	1,585	$	1,098	$	4,177	$	3,998
Property and equipment acquired through the issuance of debt and capital leases	35		17		174		935
Airport construction financing	—		1		12		42
Fully reimbursable projects	(36)		(70)		(176)		(246)
Adjusted capital expenditures (Non-GAAP)	$	1,584	$	1,046	$	4,187	$	4,729

Free Cash Flow (in millions)
Net cash provided by operating activities (GAAP)	$	1,101	$	728	$	6,181	$	3,413
Less capital expenditures	1,585		1,098		4,177		3,998
Free cash flow, net of financings (Non-GAAP)	$	(484)	$	(370)	$	2,004	$	(585)

Net cash provided by operating activities (GAAP)	$	1,101	$	728	$	6,181	$	3,413
Less adjusted capital expenditures (Non-GAAP)	1,584		1,046		4,187		4,729
Free cash flow (Non-GAAP)	$	(483)	$	(318)	$	1,994	$	(1,316)

UNITED CONTINENTAL HOLDINGS, INC.
NOTES (UNAUDITED)

(B) Special charges and MTM gains and losses on financial instruments include the following:

	Three Months Ended December 31,				Full Year Ended December 31,
(In millions)	2018		2017		2018		2017
Operating:
Impairment of assets	$	232	$	10	$	377	$	25
Termination of an engine maintenance service agreement	64		—		64		—
Severance and benefit costs	7		15		41		116
(Gains) losses on sale of assets and other special charges	(2)		6		5		35
Total special charges	301		31		487		176
Nonoperating MTM (gains) losses on financial instruments	(56)		—		5		—
Total special charges and MTM (gains) losses on financial instruments	245		31		492		176
Income tax benefit related to special charges	(68)		(11)		(109)		(63)
Income tax expense (benefit) related to MTM gains and losses on financial instruments	13		—		(1)		—
Income tax adjustments (D)	(5)		(179)		(5)		(179)
Total special charges and MTM (gains) losses on financial instruments, net of income taxes	$	185	$	(159)	$	377	$	(66)

Impairment of assets:

Routes: The company conducted its annual impairment review of intangible assets in the fourth quarter of 2018, which consisted of a comparison of the book value of specific assets to the fair value of those assets calculated using the discounted cash flow method. Due to increased costs without sufficient corresponding increases in revenue in the Hong Kong market, the company determined that the value of its Hong Kong routes had been impaired. Accordingly, in the fourth quarter of 2018, the company recorded a special non-cash impairment charge of $206 million ($160 million net of taxes) associated with its Hong Kong routes. The collateral pledged under the company's term loan, including the Hong Kong routes, continues to be sufficient to satisfy the loan covenants.

In May 2018, the Brazil–United States open skies agreement was ratified, which provides air carriers with unrestricted access between the United States and Brazil. The company determined that the approval of the open skies agreement impaired the entire value of its Brazil route authorities because the agreement removes all limitations or reciprocity requirements for flights between the United States and Brazil. Accordingly, in the second quarter of 2018, the company recorded a $105 million special charge ($82 million net of taxes) to write off the entire value of the intangible asset associated with its Brazil routes. This asset was not part of any collateral pledged against any of the company's borrowings. The company continues to maintain its slot assets related to Brazil since airport access is still regulated by slot allocations that are limited by airport facility constraints.

Other: For the three and twelve months ended December 31, 2018, the company also recorded $26 million ($20 million net of taxes) and $66 million ($51 million net of taxes), respectively, of fair value adjustments related to aircraft purchased off lease, write-off of unexercised aircraft purchase options and other impairments related to certain fleet types and international slots no longer in use.

In the fourth quarter of 2017, the company recorded a $10 million ($6 million net of taxes) impairment charge related to obsolete spare parts inventory. During 2017, the company recorded a $15 million ($10 million net of taxes) intangible asset impairment charge related to a maintenance service agreement.

Termination of a maintenance service agreement: In the fourth quarter of 2018, the company recorded a one-time termination charge of $64 million ($50 million net of tax) related to one of its engine maintenance service agreements.

Severance and benefit costs: During the three and twelve months ended December 31, 2018, the company recorded severance and benefit costs related to a voluntary early-out program for its technicians and related employees represented by the International Brotherhood of Teamsters of $3 million ($2 million net of taxes) and $22 million ($17 million net of taxes), respectively. In the first quarter of 2017, approximately 1,000 technicians and related employees elected to voluntarily separate from the company and will receive a severance payment, with a maximum value of $100,000 per participant, based on years of service, with retirement dates through 2018. Also during the three and twelve months ended December 31, 2018, the company recorded other management severance of $4 million ($3 million net of taxes) and $19 million ($15 million net of taxes), respectively.

During the three and twelve months ended December 31, 2017, the company recorded $10 million ($6 million net of taxes) and $83 million ($53 million net of taxes), respectively, of severance and benefit costs related to the voluntary early-out program for its technicians and related employees, and $5 million ($3 million net of taxes) and $33 million ($21 million net of taxes), respectively, of management severance.

MTM gains and losses on financial instruments: During the three and twelve months ended December 31, 2018, the company recorded gains of $89 million ($69 million net of taxes) and $28 million ($22 million net of taxes), respectively, for the change in market value of certain of its equity investments. During the fourth quarter of 2018, the company recorded losses of $33 million ($26 million net of taxes) for the change in fair value of certain derivative assets related to equity of Avianca Holdings S.A. For equity investments and derivative assets subject to MTM accounting, the company records gains and losses as part of Nonoperating income (expense): Miscellaneous, net in its statements of consolidated operations.

During the third quarter of 2018, United entered into an agreement with the lessor of 54 Embraer ERJ 145 aircraft to purchase those aircraft in 2019. The provisions of the new lease agreement resulted in a change in accounting classification of these new leases from operating leases to capital leases up until the purchase date. The company recognized $13 million ($10 million net of tax) and $26 million ($20 million net of tax) of additional interest expense in the three and twelve months ended December 31, 2018, respectively, as a result of this change.

(D) Effective tax rate

The company's effective tax rate for the three and twelve months ended December 31, 2018 was 16.9% and 19.9%, respectively, and the effective tax rate for the three and twelve months ended December 31, 2017 was 6.6% and 29.5%, respectively. The effective tax rate represents a blend of federal, state and foreign taxes and included the impact of certain nondeductible items. The effective tax rate for the three and twelve months ended December 31, 2018 also reflects the reduced federal corporate income tax rate as a result of the enactment of the Tax Cuts and Jobs Act (the "Tax Act") in December 2017 and the impact of a change in the company's mix of domestic and foreign earnings. The rates for the 2018 and 2017 periods were impacted by one-time benefits of $5 million and $179 million, respectively, due to the passage of the Tax Act.

SOURCE United Airlines

For further information: United Airlines Worldwide Media Relations, +1-872-825-8640, media.relations@united.com

LA's Newest Star: The United Polaris Lounge Opens at Los Angeles International Airport

January 10, 2019

LOS ANGELES, Jan. 10, 2019 /PRNewswire/ -- Beginning January 12, United customers traveling in United Polaris® business class, the airline's international premium cabin travel experience, will now be able to relax and dine before their travels in the new United Polaris lounge at Los Angeles International Airport.

The award-winning Polaris lounge experience builds on the airline's concept to be uniquely United while embracing the energy and distinct culture of Southern California and the exciting destinations United serves from here. This Polaris lounge features Southern California-style throughout, including works by local, Los Angeles-based artists, Rema Ghuloum, Chris Trueman and Ruth Pastine, and a food and beverage program inspired by the City of Angels. It is conveniently located in Terminal 7 between Gates 73 and 75A and faces west to capture the city's vibrant sunset skies.

The United Polaris lounge is the most recent investment United has made at LAX, where the airline recently completed a $573 million renovation of Terminal 7. Customers also can now take advantage of the recently completed cut-through, a new road that provides a shortcut to avoid the LAX "horseshoe" road around the terminals to help ease their travels. In addition to the Polaris lounge, United recently opened a new United Club in Terminal 7, and offers customers who want a more upscale experience access to The Private Terminal. These latest improvements and amenities help give United customers the best possible airport experience at LAX.

The airline is also committed to the greater Los Angeles community, having announced last year a $1 million grant to Southern California-based First Place for Youth.

"Los Angeles is one of United's most important gateways, particularly to Asia and Australia, and this lounge provides our customers with a best-in-class experience before they board their flights, especially for those customers with late-night departures and early-morning arrivals," said Janet Lamkin, United's California President. "We continue to expand our presence in Los Angeles, connecting customers from all over California and the U.S. to our global network. The addition of the United Polaris lounge is yet another way we provide customers with the best possible travel experience at LAX."

United Polaris Lounge at LAX Facts & Highlights

More than 12,000 square feet
140 seats, with a variety of seating areas for productivity, privacy and dining
272 power outlets and 120 USB ports
Luxurious shower suites, featuring rainfall showerheads and Soho House & Co's Cowshed Spa products
Private daybeds outfitted with Saks Fifth Avenue bedding
Customers are invited to enjoy a full restaurant-quality experience in The Dining Room before their flights. With a menu that blends international comfort foods developed by Los Angeles native Chef Tritia Gestuvo, highlights include: almond-crusted fish and chips, chilaquiles, Korean bulgogi arancini, fresh crafted sandwiches on La Brea Bakery® bread, flavorful street tacos and house-made cinnamon churros.
In a nod to the innovative cocktail culture of Los Angeles, the lounge features signature cocktails inspired by the City of Stars, including the Let's Rumble, made from Cruso Spiced Rum, fresh lemon, prickly pear puree and house-made simple syrup and the On Sunset, a playful take on the tequila sunrise, made from Casa Noble Tequila, Del Maguey Single Village Mezcal and agave nectar.

The United Polaris lounge at Los Angeles International Airport is the fifth Polaris lounge to open. Other United Polaris lounge locations include: Chicago O'Hare International Airport, George Bush Intercontinental in Houston, Newark Liberty International Airport and San Francisco International Airport.

The focus behind the United Polaris experience has always been to provide long-haul travelers with what they've asked for: the best sleep in the sky. On average, United continues to add one aircraft with the new United Polaris business class seat every 10 days from now through 2020. On Monday, the airline's newest aircraft, the Boeing 787-10 Dreamliner, officially entered service, featuring the Polaris business class seat as well as the airline's new United Premium Plus seat. United in the first North American carrier to operate the 787-10 and the only airline in the world to operate all three models of the Dreamliner.

For more photos of the United Polaris lounge at Los Angeles International Airport, visit the United Newsroom.

About United

SOURCE United Airlines

For further information: United Airlines Worldwide Media Relations, +1-872-825-8640, media.relations@united.com

United Airlines Unveils New United MileagePlus X App

January 10, 2019

CHICAGO, Jan. 10, 2019 /PRNewswire/ -- Today, United Airlines is introducing the relaunch of the United MileagePlus X app, which offers United MileagePlus® members a unique opportunity to earn award miles for everyday purchases. The app has been refreshed to integrate additional programs to make it even easier for members to accumulate miles. Additionally, the app features the launch of United Visa Rewards with offers from merchants like Sam's Club®, Wayfair®, and StubHub^TM, offering United^SM Chase Visa Cardmembers even more ways to earn miles.

App enhancements

MileagePlus Dining^SM: The existing MileagePlus Dining program has been integrated into the MileagePlus X app. With seamless enrollment and showcasing nearby restaurants, members' ability to choose where to dine and earn miles is now in the palm of their hand.
MileagePlus Shopping: The longstanding shopping program is now available through the MileagePlus X app, and offers members the ability to shop and earn miles on the go at more than 900 retailers.
United Visa Rewards: This new program is powered by Visa Commerce Network, which allows enrolled individuals to receive valuable offers within MileagePlus X thanks to the power of the Visa payments network. United Visa Rewards is available exclusively to United Chase Visa Cardmembers in the U.S. who are now able to enroll their eligible card into the program via the app. From there, they can view active enhanced mileage earning offers from participating merchants. Once program participants make a qualifying purchase with a participating merchant, they will receive a near real-time reward notification within the app. As a special launch offer, from now until March 31, 2019, United Chase Visa Cardmembers can earn 1,000 bonus award miles by simply enrolling their eligible credit card for the first time into the program.¹

"We are excited to launch the new MileagePlus X app, which allows MileagePlus members to earn and redeem award miles in real time for their everyday purchases at hundreds of merchants across the U.S, matching the increased benefits our United^SM Explorer Cardmembers received with the new credit card last summer," said Luc Bondar, president of MileagePlus Holdings and vice president of loyalty at United Airlines. "As mobile payments become more commonplace, it was a natural tie for United to update the features, enable members to make purchases and earn and use miles on the go."

"Visa and United have been working together for over 20 years," said Terry Angelos, SVP, loyalty & offers, Visa. "As digitally-savvy individuals continue to help shape the future of digital commerce, Visa continues to work with United and Chase to bring new ways to reward consumers for their loyalty. At the same time, participating merchants will benefit from Visa Commerce Network's ability to deliver custom solutions that will help increase their customer base and loyalty, ultimately helping them continue to grow their business."

Through the MileagePlus X app, members can purchase eGift Cards from hundreds of restaurants and retailers. One of the savviest ways to take advantage of this feature is to buy an eGift Card in the amount of the purchase price while at checkout at a participating merchant. In addition, primary United Chase Cardmembers earn a 25% bonus on miles earned from MileagePlus on eGift Card purchases made through the app. Customers can find eGift Cards from a variety of categories such as shopping, dining, transportation, lodging, music, and more.

About MileagePlus®

MileagePlus® is United's industry-leading loyalty program. With a wide network of partners through which members may earn and redeem miles. MileagePlus members earn award miles by flying United, United Express, Star Alliance airlines or other airline partners, and by purchasing products or services from partners around the globe. Members enjoy a host of options for using those award miles, including award travel, hotel stays, car rentals and merchandise. For the 15th consecutive year, Global Traveler voted United's MileagePlus® loyalty program the best overall frequent-flyer program in the world.

About United

¹ Available to first time enrollees only

SOURCE United Airlines

For further information: United Airlines Worldwide Media Relations, 872.825.8640, media.relations@united.com

United Reports December 2018 Operational Performance

January 09, 2019

CHICAGO, Jan. 9, 2019 /PRNewswire/ -- United Airlines (UAL) today reported December 2018 operational results.

UAL's December 2018 consolidated traffic (revenue passenger miles) increased 6.9 percent and consolidated capacity (available seat miles) increased 6.4 percent versus December 2017. UAL's December 2018 consolidated load factor increased 0.4 points compared to December 2017.

December Highlights

Announced UAL's largest ever international network expansion from San Francisco International Airport by offering nonstop year-round service to Toronto and Melbourne, Australia, seasonal service to New Delhi and a second daily flight between San Francisco and Seoul, South Korea - all subject to government approvals. In addition to the new routes, UAL will begin new year-round nonstop service between San Francisco and each of Auckland, New Zealand, Tahiti, French Polynesia and Amsterdam.
Announced the addition of 11 new routes from UAL's hubs in Chicago, Houston, Los Angeles and Washington, D.C. The company's new summer service, beginning in June 2019, will connect customers to popular summer vacation destinations in California, Colorado, Florida, Oregon, Michigan and Nova Scotia.
Mileage Plus loyalty program was voted Best Overall Frequent-Flyer Program in the world for the 15th consecutive year by readers of Global Traveler and was awarded the 2018 Frequent Traveler Titan Award for the Americas.

About United

Preliminary Operational Results

	December			Year-to-Date
	2018	2017	Change	2018	2017	Change

REVENUE PASSENGER MILES (000)

Domestic	11,058,944	10,479,105	5.5%	132,954,893	124,267,502	7.0%
Mainline	8,982,444	8,578,667	4.7%	108,634,884	102,312,669	6.2%
Regional	2,076,500	1,900,438	9.3%	24,320,009	21,954,833	10.8%
International	8,270,205	7,596,002	8.9%	97,199,892	91,992,999	5.7%
Atlantic	2,986,741	2,645,206	12.9%	40,610,724	36,220,795	12.1%
Pacific	3,108,677	2,880,088	7.9%	34,414,147	33,890,639	1.5%
Latin	2,174,787	2,070,708	5.0%	22,175,021	21,881,565	1.3%
Mainline	2,085,568	1,987,076	5.0%	21,255,941	21,019,723	1.1%
Regional	89,219	83,632	6.7%	919,080	861,842	6.6%
Consolidated	19,329,149	18,075,107	6.9%	230,154,785	216,260,501	6.4%

AVAILABLE SEAT MILES (000)
Domestic	13,295,896	12,476,108	6.6%	155,637,292	145,848,600	6.7%
Mainline	10,757,911	10,173,407	5.7%	126,385,402	119,208,926	6.0%
Regional	2,537,985	2,302,701	10.2%	29,251,890	26,639,674	9.8%
International	10,076,215	9,486,777	6.2%	119,624,405	116,537,327	2.6%
Atlantic	3,671,224	3,343,547	9.8%	49,721,287	47,297,821	5.1%
Pacific	3,835,983	3,660,168	4.8%	43,406,455	42,831,318	1.3%
Latin	2,569,008	2,483,062	3.5%	26,496,663	26,408,188	0.3%
Mainline	2,457,018	2,376,570	3.4%	25,279,532	25,238,343	0.2%
Regional	111,990	106,492	5.2%	1,217,131	1,169,845	4.0%
Consolidated	23,372,111	21,962,885	6.4%	275,261,697	262,385,927	4.9%

PASSENGER LOAD FACTOR
Domestic	83.2%	84.0%	(0.8) pts	85.4%	85.2%	0.2 pts
Mainline	83.5%	84.3%	(0.8) pts	86.0%	85.8%	0.2 pts
Regional	81.8%	82.5%	(0.7) pts	83.1%	82.4%	0.7 pts
International	82.1%	80.1%	2.0 pts	81.3%	78.9%	2.4 pts
Atlantic	81.4%	79.1%	2.3 pts	81.7%	76.6%	5.1 pts
Pacific	81.0%	78.7%	2.3 pts	79.3%	79.1%	0.2 pts
Latin	84.7%	83.4%	1.3 pts	83.7%	82.9%	0.8 pts
Mainline	84.9%	83.6%	1.3 pts	84.1%	83.3%	0.8 pts
Regional	79.7%	78.5%	1.2 pts	75.5%	73.7%	1.8 pts
Consolidated	82.7%	82.3%	0.4 pts	83.6%	82.4%	1.2 pts

ONBOARD PASSENGERS (000)
Mainline	9,448	9,006	4.9%	113,885	108,017	5.4%
Regional	3,744	3,436	9.0%	44,445	40,050	11.0%
Consolidated	13,192	12,442	6.0%	158,330	148,067	6.9%

CARGO REVENUE TON MILES (000)
Total	302,575	301,330	0.4%	3,424,625	3,315,902	3.3%

OPERATIONAL PERFORMANCE
Mainline Departure Performance ¹	67.5%	69.1%	(1.6) pts
Mainline Completion Factor	99.8%	99.8%	0.0 pts

¹Based on mainline scheduled flights departing by or before scheduled departure time

Note: See Part II, Item 6, Selected Financial Data, of the company's Annual Report on Form 10-K for the fiscal year ended December 31, 2017 for the definitions of these statistics

Safe Harbor Statement

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 : Certain statements included in this release are forward-looking and thus reflect our current expectations and beliefs with respect to certain current and future events and anticipated financial and operating performance. Such forward-looking statements are and will be subject to many risks and uncertainties relating to our operations and business environment that may cause actual results to differ materially from any future results expressed or implied in such forward-looking statements. Words such as "expects," "will," "plans," "anticipates," "indicates," "believes," "estimates," "forecast," "guidance," "outlook," "goals" and similar expressions are intended to identify forward-looking statements. Additionally, forward-looking statements include statements that do not relate solely to historical facts, such as statements which identify uncertainties or trends, discuss the possible future effects of current known trends or uncertainties, or which indicate that the future effects of known trends or uncertainties cannot be predicted, guaranteed or assured. All forward-looking statements in this release are based upon information available to us on the date of this release. We undertake no obligation to publicly update or revise any forward-looking statement,whether as a result of new information, future events, changed circumstances or otherwise, except as required by applicable law. Our actual results could differ materially from these forward-looking statements due to numerous factors including, without limitation, the following: general economic conditions (including interest rates, foreign currency exchange rates, investment or credit market conditions, crude oil prices, costs of aircraft fuel and energy refining capacity in relevant markets); economic and political instability and other risks of doing business globally, including political developments that may impact our operations in certain countries; demand for travel and the impact that global economic and political conditions have on customer travel patterns; competitive pressures on pricing and on demand; demand for transportation in the markets in which we operate; our capacity decisions and the capacity decisions of our competitors; the effects of any hostilities, act of war or terrorist attack; the effects of any technology failures or cybersecurity breaches; the impact of regulatory, investigative and legal proceedings and legal compliance risks; disruptions to our regional network; the ability of other air carriers with whom we have alliances or partnerships to provide the services contemplated by the respective arrangements with such carriers; costs associated with any modification or termination of our aircraft orders; potential reputational or other impact from adverse events in our operations, the operations of our regional carriers, the operations of our code share partners or the aircraft operated by another airline of the same model as operated by us, our regional carriers or our code share partners; our ability to attract and retain customers; our ability to execute our operational plans and revenue-generating initiatives, including optimizing our revenue; our ability to control our costs, including realizing benefits from our resource optimization efforts, cost reduction initiatives and fleet replacement programs; the impact of any management changes; our ability to cost-effectively hedge against increases in the price of aircraft fuel if we decide to do so; any potential realized or unrealized gains or losses related to any fuel or currency hedging programs; labor costs; our ability to maintain satisfactory labor relations and the results of any collective bargaining agreement process with our union groups; any disruptions to operations due to any potential actions by our labor groups; an outbreak of a disease that affects travel demand or travel behavior; U.S. or foreign governmental legislation, regulation and other actions (including Open Skies agreements and environmental regulations); industry consolidation or changes in airline alliances; our ability to comply with the terms of our various financing arrangements; the costs and availability of financing; our ability to maintain adequate liquidity; the costs and availability of aviation and other insurance; weather conditions; our ability to utilize our net operating losses to offset future taxable income; the impact of changes in tax laws; the success of our investments in airlines in other parts of the world; and other risks and uncertainties set for thunder Part I, Item 1A., "Risk Factors," of our Annual Report on Form 10-K for the fiscal year ended December 31, 2017, as well as other risks and uncertainties set forth from time to time in the reports we file with the U.S. Securities and Exchange Commission.

SOURCE United Airlines

For further information: United Airlines, Worldwide Media Relations, 872.825.8640, media.relations@united.com

United Airlines to Hold Live Webcast of Fourth-Quarter and Full-Year 2018 Financial Results

January 07, 2019

CHICAGO, Jan. 7, 2019 /PRNewswire/ -- United Airlines will hold a conference call to discuss fourth-quarter and full-year 2018 financial results on Wednesday, January 16, at 9:30 a.m. CT/10:30 a.m. ET. A live, listen-only webcast of the conference call will be available at ir.united.com. The company will issue its fourth-quarter and full-year 2018 financial results and first-quarter 2019 investor update after market close on Tuesday, January 15.

The webcast will be available for replay within 24 hours of the conference call and then archived on the website for three months.

Notable Special Charges

For fourth quarter 2018, the company expects to record a special non-cash impairment charge of $206 million ($160 million net of taxes) associated with its Hong Kong routes. The company conducted its annual impairment review of intangible assets in the fourth quarter of 2018, which consisted of a comparison of the book value of specific assets to the fair value of those assets calculated using the discounted cash flow method. Due to increased costs without sufficient corresponding increases in revenue in the Hong Kong market, the company determined that the value of its Hong Kong routes had been impaired. The collateral pledged under the company's term loan, including the Hong Kong routes, continues to be sufficient to satisfy the loan covenants.

The company expects to also record a one-time termination fee with a present value of $64 million ($50 million net of tax) related to one of its engine maintenance service agreements.

About United

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: Certain statements included in this release are forward-looking and thus reflect our current expectations and beliefs with respect to certain current and future events and anticipated financial and operating performance. Such forward-looking statements are and will be subject to many risks and uncertainties relating to our operations and business environment that may cause actual results to differ materially from any future results expressed or implied in such forward-looking statements. Words such as "expects," "will," "plans," "anticipates," "indicates," "believes," "estimates," "forecast," "guidance," "outlook," "goals" and similar expressions are intended to identify forward-looking statements. Additionally, forward-looking statements include statements that do not relate solely to historical facts, such as statements which identify uncertainties or trends, discuss the possible future effects of current known trends or uncertainties, or which indicate that the future effects of known trends or uncertainties cannot be predicted, guaranteed or assured. All forward-looking statements in this release are based upon information available to us on the date of this release. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, changed circumstances or otherwise, except as required by applicable law. Our actual results could differ materially from these forward-looking statements due to numerous factors including, without limitation, the following: general economic conditions (including interest rates, foreign currency exchange rates, investment or credit market conditions, crude oil prices, costs of aircraft fuel and energy refining capacity in relevant markets); economic and political instability and other risks of doing business globally, including political developments that may impact our operations in certain countries; demand for travel and the impact that global economic and political conditions have on customer travel patterns; competitive pressures on pricing and on demand; demand for transportation in the markets in which we operate; our capacity decisions and the capacity decisions of our competitors; the effects of any hostilities, act of war or terrorist attack; the effects of any technology failures or cybersecurity breaches; the impact of regulatory, investigative and legal proceedings and legal compliance risks; disruptions to our regional network; the ability of other air carriers with whom we have alliances or partnerships to provide the services contemplated by the respective arrangements with such carriers; costs associated with any modification or termination of our aircraft orders; potential reputational or other impact from adverse events in our operations, the operations of our regional carriers, the operations of our code share partners or the aircraft operated by another airline of the same model as operated by us, our regional carriers or our code share partners; our ability to attract and retain customers; our ability to execute our operational plans and revenue-generating initiatives, including optimizing our revenue; our ability to control our costs, including realizing benefits from our resource optimization efforts, cost reduction initiatives and fleet replacement programs; the impact of any management changes; our ability to cost-effectively hedge against increases in the price of aircraft fuel if we decide to do so; any potential realized or unrealized gains or losses related to any fuel or currency hedging programs; labor costs; our ability to maintain satisfactory labor relations and the results of any collective bargaining agreement process with our union groups; any disruptions to operations due to any potential actions by our labor groups; an outbreak of a disease that affects travel demand or travel behavior; U.S. or foreign governmental legislation, regulation and other actions (including Open Skies agreements and environmental regulations); industry consolidation or changes in airline alliances; our ability to comply with the terms of our various financing arrangements; the costs and availability of financing; our ability to maintain adequate liquidity; the costs and availability of aviation and other insurance; weather conditions; our ability to utilize our net operating losses to offset future taxable income; the impact of changes in tax laws; the success of our investments in airlines in other parts of the world; and other risks and uncertainties set forth under Part I, Item 1A., "Risk Factors," of our Annual Report on Form 10-K for the fiscal year ended December 31, 2017, as well as other risks and uncertainties set forth from time to time in the reports we file with the U.S. Securities and Exchange Commission.

SOURCE United Airlines

For further information: United Airlines Worldwide Media Relations, +1-872-825-8640, media.relations@united.com

United Airlines' First 787-10 Begins Regular Service, Flying Coast to Coast

January 07, 2019

LOS ANGELES, Jan. 7, 2019 /PRNewswire/ -- Today, United Airlines' first Boeing 787-10 Dreamliner began regular service as UA2418, departing from Los Angeles International Airport traveling to Newark Liberty International Airport. United is the first carrier in the world to operate all three Dreamliner models, including the 787-8, 787-9 and now the longest model, the 787-10.

The Dreamliner's entry into scheduled service continues United's comprehensive fleet plan, while providing an improved experience for customers. The aircraft is United's first Dreamliner model delivered with the airline's signature Polaris business class seats, and new United^® Premium Plus seats. Boeing's Dreamliners are known for dramatically improving the on board experience for customers with lower cabin altitude, better humidity, cleaner air, smoother ride and better sound quality. Additionally, the new Dreamliner provides better fuel efficiency than older aircraft, contributing to United's commitment to reducing emissions by 50 percent by 2050.

As previously announced, United expects its second Dreamliner to enter service between its hubs in San Francisco and New York/Newark in February, and begin international service in March.

For more information on United's 787-10, and other fleet updates visit United's Fleet Newsroom.

About United

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