United strong first quarter 2016 performance - United Hub

United Airlines Announces Strong First-Quarter 2016 Performance

Mainline on-time arrival improvement of 14 points year-over-year; best quarterly on-time performance since the merger
April 20, 2016

CHICAGO, April 20, 2016 /PRNewswire/ -- United Airlines (UAL) today reported its first-quarter 2016 financial results.

  • Excluding special items, UAL reported first-quarter net income of $435 million, earnings per share of $1.23 per diluted share and pre-tax earnings of $688 million.
  • Including special items, UAL reported first-quarter net income of $313 million, earnings per share of $0.88 per diluted share and pre-tax earnings of $494 million.
  • During the first quarter of 2016, the company repurchased $1.5 billion worth of its common stock, representing approximately 8 percent of shares outstanding.

 

"I am extremely proud of United's nearly 86,000 aviation professionals for their contributions to these strong results – including the improvements in our reliability, customer satisfaction and financial performance," said Oscar Munoz, president and chief executive officer of United Airlines. "As we accelerate United's path forward, we will continue to focus on running a great airline today while innovating for tomorrow."

First-Quarter Revenue

For the first quarter of 2016, total revenue was $8.2 billion, a decrease of 4.8 percent year-over-year. First-quarter 2016 consolidated passenger revenue per available seat mile (PRASM) decreased 7.4 percent and consolidated yield decreased 6.1 percent compared to the first quarter of 2015. The decline in PRASM continues to be driven by economic factors including a strong U.S. dollar and lower oil prices. In addition, the company experienced a larger-than-anticipated decrease in close-in business travel during the weeks surrounding the Easter holiday and spring break.

The company continues to focus on providing customers options to personalize their travel experience and, this quarter, launched its new bundled products offering, which is exceeding expectations.

First-Quarter Costs

Total operating expense excluding special charges was $7.4 billion in the first quarter, down 5.7 percent year-over-year. Including special charges, total operating expense was $7.5 billion, a 4.1 percent decrease year-over-year. The decrease was largely driven by lower oil prices. Consolidated unit cost (CASM), excluding special charges, third-party business expenses, fuel and profit sharing, increased 1.3 percent compared to the first quarter of 2015. Consolidated CASM including those items decreased 5.7 percent year-over-year.

Liquidity and Capital Allocation

In the first quarter, UAL generated $1.2 billion in operating cash flow, $376 million in free cash flow and ended the quarter with $5.3 billion in unrestricted liquidity, including $1.35 billion of undrawn commitments under its revolving credit facility. During the first quarter, the company continued to invest in its business through gross capital expenditures of approximately $820 million, excluding fully reimbursable projects, and repurchased $1.5 billion worth of its common stock, representing approximately 8 percent of shares outstanding.

UAL earned a 20.8 percent return on invested capital for the 12 months ended March 31, 2016.

For more information on UAL's second-quarter 2016 guidance, please visit ir.united.com for the company's investor update.

Recent Accomplishments
Operations and Employees

  • Reported best quarterly on-time performance since the merger with a mainline arrival rate of 71.9 percent.
  • Achieved best quarterly mishandled bag rate since the merger.
  • Employees earned cash-incentive payments of approximately $30 million for achieving operational performance goals.
  • Reached ratified agreements with more than half of represented employees – pilots, dispatchers and IAM-represented employees. The company remains focused on getting contracts like these for flight attendants and technicians.

Network and Fleet

  • Announced new international routes including service between San Francisco and Hangzhou, China and San Francisco and Singapore, both with the Boeing 787-9 Dreamliner and subject to government approval.
  • Launched the first-ever nonstop service between San Francisco and Tel Aviv.
  • Announced a joint venture revenue-sharing agreement with Air New Zealand.
  • Signed a multi-year agreement to strengthen partnership and established a joint strategic initiative with Air China.
  • Ordered 65 customer-pleasing, two-cabin Boeing 737-700 aircraft, reducing reliance on 50-seat aircraft.

Customer Experience

  • Achieved highest customer satisfaction score in the combined company's history.
  • United's industry-leading mobile app topped 21 million downloads and was used by 50 percent of MileagePlus members when traveling.
  • First U.S. airline to use commercial-scale volumes of biofuel for regularly scheduled flights.

About United

United Airlines and United Express operate an average of 5,000 flights a day to 336 airports across six continents. In 2015, United and United Express operated more than 1.5 million flights carrying more than 140 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, New York/Newark, San Francisco and Washington, D.C. United operates more than 715 mainline aircraft, and this year, the airline anticipates taking delivery of 21 new Boeing aircraft, including 737 NGs, 787s and 777s. The airline is a founding member of Star Alliance, which provides service to 192 countries via 28 member airlines. Approximately 86,000 United employees reside in every U.S. state and in countries around the world. 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 NYSE under the symbol UAL.

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 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," "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: our ability to comply with the terms of our various financing arrangements; the costs and availability of financing; our ability to maintain adequate liquidity; 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; our ability to utilize our net operating losses; our ability to attract and retain customers; demand for transportation in the markets in which we operate; an outbreak of a disease that affects travel demand or travel behavior; demand for travel and the impact that global economic conditions have on customer travel patterns; excessive taxation and the inability to offset future taxable income; 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; our ability to cost-effectively hedge against increases in the price of aircraft fuel; any potential realized or unrealized gains or losses related to fuel or currency hedging programs; the effects of any hostilities, act of war or terrorist attack; 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; disruptions to our regional network; the costs and availability of aviation and other insurance; industry consolidation or changes in airline alliances; competitive pressures on pricing and on demand; our capacity decisions and the capacity decisions of our competitors; U.S. or foreign governmental legislation, regulation and other actions (including open skies agreements and environmental regulations); the impact of regulatory, investigative and legal proceedings and legal compliance risks; the impact of any management changes; labor costs; our ability to maintain satisfactory labor relations and the results of the collective bargaining agreement process with our union groups; any disruptions to operations due to any potential actions by our labor groups; weather conditions; and other risks and uncertainties set forth under Part I, Item 1A., "Risk Factors," of UAL's Annual Report on Form 10-K, 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 AND NINE MONTHS ENDED SEPTEMBER 30, 2016 AND 2015

(In millions, except per share data)

  Three Months Ended
March 31, 2016
Three Months Ended
March 31, 2015
%
Increase/
(Decrease)
Operating revenue:
Passenger: (A)
Mainline
$5,577 $5,938 (6.1)
Operating revenue: Passenger: (A) Regional 1,413 1,482 (4.7)
Operating revenue: Passenger: (A) Total passenger revenue 6,990 7,420 (5.8)
Operating revenue: Cargo 194 242 (19.8)
Operating revenue: Other operating revenue 1,011 946 6.9
Operating revenue:Other operating revenue: Total operating revenue 8,195 8,608 (4.8)
Operating expense:
Salaries and related costs
2,490 2,301 8.2
Operating expense: Aircraft fuel(B) 1,218 1,864 (34.7)
Operating expense: Landing fees and other rent 525 543 (3.3)
Operating expense: Regional capacity purchase 522 570 (8.4)
Operating expense: Depreciation and amortization 479 429 11.7
Operating expense: Aircraft maintenance materials and outside repairs 402 397 1.3
Operating expense: Distribution expenses 303 312 (2.9)
Operating expense: Aircraft rent 178 201 (11.4)
Operating expense: Special charges (C) 190 64 NM1
Operating expense: Other operating expenses 1,239 1,186 4.5
Operating expense: Other operating expenses: Total operating expenses 7,546 7,867 (4.1)
Operating income 649 741 (12.4)
Nonoperating income (expense):
Interest expense
(159) (173) (8.1)
Nonoperating income (expense): Interest capitalized 14 12 16.7
Nonoperating income (expense): Interest income 8 5 60.0
Nonoperating income (expense): Miscellaneous, net (C) (18) (74) (75.7)
Nonoperating income (expense): Miscellaneous, net (C): Total nonoperating expense (155) (230) (32.6)
Income before income taxes 494 511 (3.3)
Income tax expense (benefit) (D) 181 3 NM1
Net income $313 $508 (38.4)
Earnings per share, basic $0.88 $1.33 (33.8)
Earnings per share, diluted $0.88 $1.32 (33.3)
Weighted average shares, basic 354 382 (7.3)
Weighted average shares, diluted 355 384 (7.6)
  1. NM means Not Meaningful

 

UNITED CONTINENTAL HOLDINGS, INC.
NOTES (UNAUDITED)

(A) Select passenger revenue information is as follows (in millions):
  1Q 2016
Passenger
Revenue
(millions)
Passenger
Revenue
vs.
1Q 2015
PRASM
vs.
1Q 2015
Yield
vs.
1Q 2015
Available
Seat Miles
vs.
1Q 2015
Domestic $2,868 (2.8%) (5.5%) (4.3%) 2.8%
Atlantic 1,040 (11.9%) (8.9%) (4.1%) (3.3%)
Pacific 952 (10.1%) (9.4%) (7.8%) (0.8%)
Latin America 717 (4.0%) (14.5%) (15.1%) 12.3%
International 2,709 (9.3%) (10.5%) (8.7%) 1.4%
Mainline 5,577 (6.1%) (8.0%) (6.5%) 2.1%
Regional 1,413 (4.7%) (4.1%) (3.7%) (0.5%)
Consolidated $6,990 (5.8%) (7.4%) (6.1%) 1.8%

 

UNITED CONTINENTAL HOLDINGS, INC.
NOTES (UNAUDITED)

(B) UAL's results of operations include fuel expense for both mainline and regional operations. (In millions, except per gallon)
  Three Months Ended
March 31, 2016
Three Months Ended
March 31, 2015
%
Increase/
(Decrease)
Mainline fuel expense excluding hedge impacts $885 $1,396 (36.6)
Hedge losses reported in fuel expense 2 (138) (161) NM1
Total mainline fuel expense 1,023 1,557 (34.3)
Regional fuel expense 195 307 (36.5)
Consolidated fuel expense 1,218 1,864 (34.7)
Cash paid on settled hedges that did not qualify for hedge accounting 3 (5) (39) NM1
Fuel expense including all losses from settled hedges $1,223 $1,903 (35.7)
Mainline fuel consumption (gallons) 734 737 (0.4)
Mainline average aircraft fuel price per gallon excluding hedge losses recorded in fuel expense $1.21 $1.89 (36.0)
Mainline average aircraft fuel price per gallon $1.39 $2.11 (34.1)
Mainline average aircraft fuel price per gallon including cash paid on settled hedges that did not qualify for hedge accounting $1.40 $2.17 (35.5)
Regional fuel consumption (gallons) 156 159 (1.9)
Regional average aircraft fuel price per gallon $1.25 $1.93 (35.2)
Consolidated fuel consumption (gallons) 890 896 (0.7)
Consolidated average aircraft fuel price per gallon excluding hedge losses recorded in fuel expense $1.21 $1.90 (36.3)
Consolidated average aircraft fuel price per gallon $1.37 $2.08 (34.1)
Consolidated average aircraft fuel price per gallon including cash paid on settled hedges that did not qualify for hedge accounting $1.37 $2.12 (35.4)
  1. Includes losses from settled hedges that were designated for hedge accounting. UAL allocates 100 percent of hedge accounting gains (losses) to mainline fuel expense.
  2. Includes ineffectiveness losses on settled hedges and losses on settled hedges that were not designated for hedge accounting. Ineffectiveness gains (losses) and gains (losses) on hedges that do not qualify for hedge accounting are recorded in Nonoperating income (expense): Miscellaneous, net.
UNITED CONTINENTAL HOLDINGS, INC.
NOTES (UNAUDITED)

(C) Special items include the following:
  Three Months Ended
March 31, 2016 (In millions)
Three Months Ended
March 31, 2015 (In millions)
Operating:
Labor agreement costs
$100 $ —
Operating:Cleveland airport lease restructuring 74
Operating:Severance and benefit costs 8 50
Operating:(Gains) losses on sale of assets and other special charges 8 14
Operating: (Gains) losses on sale of assets and other special charges:Special charges 190 64
Nonoperating and income taxes:
Losses on extinguishment of debt and other
8 6
Nonoperating and income taxes:Income tax benefit related to special charges (72)
Nonoperating and income taxes: Income tax benefit related to special charges:Total operating and nonoperating special charges, net of income taxes 126 70
Nonoperating and income taxes:Mark-to-market (MTM) losses from fuel derivative contracts settling in future periods 36
Nonoperating and income taxes:Prior period gains (losses) on fuel derivative contracts settled in the current period (4) (32)
Nonoperating and income taxes: Prior period gains (losses) on fuel derivative contracts settled in the current period:Total special items, net of income taxes $122 $74

 

 
   
 

2016 - Special items

   
 

Labor agreement costs: The fleet service, passenger service, storekeeper and other employees represented by the Int'l Association of Machinists and Aerospace Workers ratified seven new contracts with the company which extended the contracts through 2021. The company recorded a $100 million ($64 million net of taxes) special charge for bonus payments to be made in conjunction with the ratification of these contracts.

   
 

Cleveland airport lease restructuring: During the three months ended March 31, 2016, the City of Cleveland agreed to amend the lease, which runs through 2029, associated with certain excess airport terminal space (principally Terminal D) and related facilities at Hopkins International Airport ("Cleveland"). The company recorded an accrual for remaining payments under the lease for facilities that the company no longer uses and will continue to incur costs under the lease without economic benefit to the company. This liability was measured and recorded at its fair value when the company ceased its right to use such facilities leased to it pursuant to the lease. The company reduced its flight operations at Cleveland in 2014 and had been evaluating its options for the excess space. The company recorded a net charge of $74 million ($47 million net of taxes) related to the amended lease.

   
 

Severance and benefit costs: During the three months ended March 31, 2016, the company recorded $8 million ($5 million net of taxes) of severance and benefit costs primarily related to a voluntary early-out program for its flight attendants. In 2014, more than 2,500 flight attendants 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 the end of 2016.

   
 

Loss on extinguishment of debt and other: During the three months ended March 31, 2016, the company recorded $8 million of losses due to exchange rate changes in Venezuela applicable to funds held in local currency.

   
 

MTM losses from fuel derivative contracts settling in future periods and prior period losses on fuel derivative contracts settled in the current period: The company uses certain combinations of derivative contracts that are economic hedges but do not qualify for hedge accounting under U.S. generally accepted accounting principles. Additionally, the company may enter into contracts at different times and later combine those contracts into structures designated for hedge accounting. As with derivatives that qualify for hedge accounting, the economic hedges and individual contracts are part of the company's program to mitigate the adverse financial impact of potential increases in the price of fuel. The company records changes in the fair value of these various contracts that are not designated for hedge accounting to Nonoperating income (expense): Miscellaneous, net in the statements of consolidated operations. During the three months ended March 31, 2016, the company did not record any MTM gains or losses on fuel derivative contracts that will settle in future periods. For fuel derivative contracts that settled in the three months ended March 31, 2016, the company recorded MTM losses of $4 million in prior periods.

   
 

2015 - Special items

   
 

Severance and benefit costs: During the three months ended March 31, 2015, the company recorded $50 million of severance and benefit costs primarily related to a voluntary early-out program for its flight attendants. In 2014, more than 2,500 flight attendants 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 the end of 2016.

   
 

(Gains) losses on sale of assets and other special charges: During the three months ended March 31, 2015, the company recorded $18 million of integration-related charges, $5 million of other charges, and approximately $9 million of gains on the sale of assets.

   
 

Loss on extinguishment of debt and other: During the three months ended March 31, 2015, the company recorded $6 million of losses as part of Nonoperating income (expense): Miscellaneous, net due to the write-off of the debt discount related to the redemption of the 6% Notes due 2026 and 6% Notes due 2028.

   
 

MTM losses from fuel derivative contracts settling in future periods and prior period losses on fuel derivative contracts settled in the current period: The company uses certain combinations of derivative contracts that are economic hedges but do not qualify for hedge accounting under U.S. generally accepted accounting principles. Additionally, the company may enter into contracts at different times and later combine those contracts into structures designated for hedge accounting. As with derivatives that qualify for hedge accounting, the economic hedges and individual contracts are part of the company's program to mitigate the adverse financial impact of potential increases in the price of fuel. The company records changes in the fair value of these various contracts that are not designated for hedge accounting to Nonoperating income (expense): Miscellaneous, net in the statements of consolidated operations. During the three months ended March 31, 2015, the company recorded $36 million in MTM losses on fuel derivative contracts that will settle in future periods. For fuel derivative contracts that settled in the three months ended March 31, 2015, the company recorded MTM losses of $32 million in prior periods.

   

(D)  

The company's effective tax rate for the three months ended March 31, 2016 was 36.6%, which represented a blend of federal, state and foreign taxes and the impact of certain nondeductible items. The effective rate for the three months ended March 31, 2015 was 0.5% due primarily to the existing income tax valuation allowance against deferred income tax assets, primarily net operating losses. During 2015, after considering all positive and negative evidence, the company concluded that its deferred income taxes would be more likely than not to be realized. The company released substantially all of its valuation allowance in 2015.

 

UNITED CONTINENTAL HOLDINGS, INC.
STATISTICS
  Three Months Ended
March 31, 2016
Three Months Ended
March 31, 2015
%
Increase/
(Decrease)
Mainline:
Passengers (thousands)
22,277 21,378 4.2
Mainline:Revenue passenger miles (millions) 40,856 40,660 0.5
Mainline:Available seat miles (millions) 51,165 50,125 2.1
Mainline:Cargo ton miles (millions) 622 662 (6.0)
Mainline:Passenger load factor:
Mainline
79.9% 81.1% (1.2) pts.
Mainline:Domestic 83.4% 84.4% (1.0) pts.
Mainline:International 76.5% 78.1% (1.6) pts.
Mainline:Passenger revenue per available seat mile (cents) 10.90 11.85 (8.0)
Mainline:Average yield per revenue passenger mile (cents) 13.65 14.60 (6.5)
Mainline:Aircraft in fleet at end of period 719 700 2.7
Mainline:Average stage length (miles) 1,859 1,917 (3.0)
Mainline:Average daily utilization of each aircraft (hours) 9:36 9:55 (3.2)
Regional:
Passengers (thousands)
9,810 10,144 (3.3)
Regional:Revenue passenger miles (millions) 5,726 5,784 (1.0)
Regional:Available seat miles (millions) 7,108 7,144 (0.5)
Regional:Passenger load factor 80.6% 81.0% (0.4) pts.
Regional:Passenger revenue per available seat mile (cents) 19.88 20.74 (4.1)
Regional:Average yield per revenue passenger mile (cents) 24.68 25.62 (3.7)
Regional:Aircraft in fleet at end of period 503 532 (5.5)
Regional:Average stage length (miles) 575 561 2.5
Consolidated (Mainline and Regional):
Passengers (thousands)
32,087 31,522 1.8
Consolidated (Mainline and Regional)Revenue passenger miles (millions) 46,582 46,444 0.3
Consolidated (Mainline and Regional)Available seat miles (millions) 58,273 57,269 1.8
Consolidated (Mainline and Regional)Passenger load factor 79.9% 81.1% (1.2) pts.
Consolidated (Mainline and Regional)Passenger revenue per available seat mile (cents) 12.00 12.96 (7.4)
Consolidated (Mainline and Regional)Total revenue per available seat mile (cents) 14.06 15.03 (6.5)
Consolidated (Mainline and Regional)Average yield per revenue passenger mile (cents) 15.01 15.98 (6.1)
Consolidated (Mainline and Regional)Aircraft in fleet at end of period 1,222 1,232 (0.8)
Consolidated (Mainline and Regional)Average stage length (miles) 1,461 1,473 (0.8)
Consolidated (Mainline and Regional)Average full-time equivalent employees (thousands) 82.5 81.7 1.0
Note:See Part II, Item 6 Selected Financial Data of the company's annual report on Form 10-K for the year ended December 31, 2015 for the definition of these statistics.

 

UNITED CONTINENTAL HOLDINGS, INC.
NON-GAAP FINANCIAL RECONCILIATION

UAL evaluates its financial performance utilizing various accounting principles generally accepted in the United States of America (GAAP) and Non-GAAP financial measures, including income (loss) before income taxes excluding special items, net income (loss) excluding special items, net earnings (loss) per share excluding special items, and CASM, among others. CASM is a common metric used in the airline industry to measure an airline's cost structure and efficiency. Pursuant to SEC Regulation G, UAL has included the following reconciliation of reported Non-GAAP financial measures to comparable financial measures reported on a GAAP basis. UAL believes that adjusting for special items is useful to investors because special charges are non-recurring charges not indicative of UAL's ongoing performance. In addition, the company believes that adjusting for MTM gains and losses from fuel derivative contracts settling in future periods and prior period gains and losses on fuel derivative contracts settled in the current period is useful because the adjustments allow investors to better understand the cash impact of settled fuel derivative contracts in a given period. UAL also believes that excluding third-party business expenses, such as maintenance, ground handling and catering services for third parties, fuel sales and non-air mileage redemptions, 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. UAL also believes that adjusting capital expenditures for fully reimbursable projects is useful to investors in order to appropriately reflect the non-reimbursable funds spent on capital expenditures.

 

UNITED CONTINENTAL HOLDINGS, INC.
NON-GAAP FINANCIAL RECONCILIATION (Continued)
  Three Months Ended
March 31, 2016 (In millions)
Three Months Ended
March 31, 2015 (In millions)
$
Increase/
(Decrease)
%
Increase/
(Decrease)
Operating expenses $7,546 $7,867 $(321) (4.1)
Operating expenses:Less: Special charges (C) 190 64 126 NM1
Operating expenses, excluding special charges 7,356 7,803 (447) (5.7)
Operating expenses, excluding special charges:Less: Third-party business expenses 67 66 1 1.5
Operating expenses, excluding special charges:Less: Fuel expense 1,218 1,864 (646) (34.7)
Operating expenses, excluding special charges:Less: Profit sharing, including taxes 93 70 23 32.9
Operating expenses, excluding fuel, profit sharing, special charges and third-party business expenses $5,978 $5,803 $175 3.0
Income before income taxes $494 $511 $(17) (3.3)
Income before income taxes:Less: special items before income taxes (C) 194 74 120 NM1
Income before income taxes and excluding special items $688 $585 $103 17.6
Net income $313 $508 $(195) (38.4)
Net income:Less: special items, net of tax (C) 122 74 48 NM1
Net income, excluding special items $435 $582 $(147) (25.3)
Diluted earnings per share $0.88 $1.32 $(0.44) (33.3)
Diluted earnings per share:Add back: special items 0.35 0.20 0.15 NM1
Diluted earnings per share, excluding special items $1.23 $1.52 $(0.29) (19.1)

 

UNITED CONTINENTAL HOLDINGS, INC.
NON-GAAP FINANCIAL RECONCILIATION (Continued)
  Three Months Ended
March 31, 2016 in cents
Three Months Ended
March 31, 2015 in cents
%
Increase/
(Decrease)
CASM Mainline Operations (cents)
Cost per available seat mile (CASM)
12.47 12.99 (4.0)
Cost per available seat mile (CASM):Less: Special charges (C) 0.37 0.13 NM1
CASM Mainline Operations (cents): CASM, excluding special charges 12.10 12.86 (5.9)
CASM Mainline Operations (cents): CASM, excluding special charges:Less: Third-party business expenses 0.13 0.13
CASM Mainline Operations (cents): CASM, excluding special charges and third-party business expenses 11.97 12.73 (6.0)
CASM Mainline Operations (cents): CASM, excluding special charges and third-party business expenses:Less: Fuel expense 2.00 3.10 (35.5)
CASM Mainline Operations (cents): CASM, excluding special charges, third-party business expenses and fuel 9.97 9.63 3.5
CASM Mainline Operations (cents): CASM, excluding special charges, third-party business expenses and fuel:Less: Profit sharing per available seat mile 0.18 0.14 28.6
CASM Mainline Operations (cents): CASM, excluding special charges, third-party business expenses, fuel, and profit sharing 9.79 9.49 3.2
CASM Consolidated Operations (cents)
Cost per available seat mile (CASM)
12.95 13.74 (5.7)
CASM Consolidated Operations (cents): Cost per available seat mile (CASM):Less: Special charges (C) 0.33 0.11 NM1
CASM Consolidated Operations (cents): CASM, excluding special charges 12.62 13.63 (7.4)
CASM Consolidated Operations (cents): CASM, excluding special charges:Less: Third-party business expenses 0.11 0.12 (8.3)
CASM Consolidated Operations (cents): CASM, excluding special charges and third-party business expenses 12.51 13.51 (7.4)
CASM Consolidated Operations (cents): CASM, excluding special charges and third-party business expenses:Less: Fuel expense 2.09 3.25 (35.7)
CASM Consolidated Operations (cents): CASM, excluding special charges, third-party business expenses and fuel 10.42 10.26 1.6
CASM Consolidated Operations (cents): CASM, excluding special charges, third-party business expenses and fuel:Less: Profit sharing per available seat mile 0.16 0.13 23.1
CASM Consolidated Operations (cents): CASM, excluding special charges, third-party business expenses, fuel, and profit sharing 10.26 10.13 1.3

 

UNITED CONTINENTAL HOLDINGS, INC.
CAPITAL EXPENDITURES AND FREE CASH FLOW
Capital Expenditures (in millions) Three Months Ended
March 31, 2016 (in millions)
Capital Expenditures (in millions):Capital expenditures – GAAP $816
Capital Expenditures (in millions): Capital expenditures – GAAP:Property and equipment acquired through the issuance of debt 59
Capital Expenditures (in millions): Capital expenditures – GAAP:Airport construction financing 9
Capital Expenditures (in millions): Capital expenditures – GAAP:Fully reimbursable projects (61)
Capital Expenditures (in millions):Adjusted capital expenditures – Non-GAAP $823
Free Cash Flow (in millions) Three Months Ended
March 31, 2016
Free Cash Flow (in millions):Net cash provided by operating activities $1,199
Free Cash Flow (in millions): Net cash provided by operating activities:Less adjusted capital expenditures – Non-GAAP 823
Free Cash Flow (in millions):Free cash flow - Non-GAAP $376

 

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

ROIC is a Non-GAAP financial measure that we believe provides useful supplemental information for management and investors by measuring the effectiveness of our operations' use of invested capital to generate profits.
  Twelve Months Ended
March 31, 2016 (in millions)
Return On Invested CapitalNet Operating Profit After Tax (NOPAT)
Pre-tax income excluding special items4
$4,601
Return On Invested CapitalNOPAT adjustments 5 1,078
Return On Invested CapitalNOPAT $5,679
Return On Invested CapitalEffective cash tax rate 6 0.3%
Return On Invested CapitalInvested Capital (five-quarter average)
Total assets
$39,966
Return On Invested CapitalInvested capital adjustments 7 12,617
Return On Invested CapitalAverage Invested Capital $27,349
Return On Invested CapitalReturn on Invested Capital 20.8%
  1. Non-GAAP Financial Reconciliation
  2. NOPAT adjustments include: adding back (net of tax shield) interest expense, the interest component of capitalized aircraft rent and net interest on pension.
  3. Effective cash tax rate is calculated by dividing cash taxes paid by adjusted pre-tax income.
  4. Invested capital adjustments include: adding back capital aircraft rent (at 7.0X) and deferred income taxes, less advance ticket sales, frequent flyer deferred revenue, tax valuation allowance and other non-interest bearing liabilities.
Notes: Twelve Months Ended
March 31, 2016
Pre-tax income $4,202
Return On Invested CapitalAdd: Special items 399
Return On Invested CapitalPre-tax income excluding special items $4,601

 

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Logo - http://photos.prnewswire.com/prnh/20130404/MM89155LOGO

 

SOURCE United Airlines

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

United Strengthens Sustainability Commitment Through Collaboration with More Than a Dozen New Community Organizations

Airline supports organizations focused on clean-technology innovation, recycling strategies, and grassroots environmental education and justice

United works with more environmental, nonprofit partners than any other major U.S. airline

May 13, 2021

CHICAGO, May 13, 2021 – United announced today that it has teamed up with more than a dozen new environmental, nonprofit partners to advance sustainability efforts across the airline's hub cities as well as Hawaii, complementing the airline's commitment to become 100% green and reduce its greenhouse gas emissions 100% by 2050.

United Expands Beer, Wine and Snacks to Nearly All Flights Over Two Hours

Starting in June, White Claw® Hard Seltzer, beer, wine and all-new snack menu items will be available for purchase using United's contactless payment technology
May 12, 2021

CHICAGO, May 12, 2021 /PRNewswire/ -- Starting June 1, United customers on most flights over two hours will be able to purchase beer, wine and White Claw® Hard Seltzer, making United the first major airline to offer the hard seltzer onboard its aircraft. On June 15, United will introduce a revamped menu of for-purchase snacks and brand-new premium cabin meal options on most flights over 1,500 miles and hub-to-hub flights over 800 miles or more than two hours. Customers will be able to purchase these offerings from the Buy-On-Board menu using United's new mobile wallet technology.

United and Abbott Partner to Make Return to U.S. "Worry Free" for International Travelers with Home-Testing Kits

Newly issued guidance from the U.S. Centers for Disease Control and Prevention now accepts rapid, self-administered testing option that meet its criteria
May 12, 2021

CHICAGO and ABBOTT PARK, Ill., May 12, 2021 /PRNewswire/ -- United and Abbott today announced a first-of-its-kind collaboration to use Abbott's BinaxNOW™ COVID-19 Home Test and Abbott's NAVICA app to help make the international travel experience more seamless. Recently updated CDC guidelines permit travelers to self-administer a rapid antigen test under the real-time supervision of a telehealth service and use the verified negative test result to board an international flight to the U.S. if they test negative.

United Airlines Expands India Relief Efforts with Online Fundraising Campaign

Airline providing up to 5 million bonus miles for donations and matching up to $40,000 in cash donations to disaster relief partners
May 04, 2021

CHICAGO, May 4, 2021 /PRNewswire/ -- Today, United Airlines expands its efforts to support those impacted by the COVID-19 crisis in India with the launch of a new online fundraising campaign. Customers can donate to the airline's relief partners: Airlink, Americares, GlobalGiving Foundation and World Central Kitchen. United is offering up to 5 million bonus miles to encourage MileagePlus® members to support this effort and will match each donation up to a total of $40,000 in cash donations. In addition, United is currently the only U.S. airline serving India, and over the last few days has helped transport more than 300,000 pounds of critical medical supplies to the region.

"Throughout the pandemic, we have been committed to leveraging our resources and relationships to provide support to communities hit hardest by COVID-19," said Luc Bondar, vice president of marketing & loyalty and president of MileagePlus at United. "As India faces this crisis, our generous customers, employees and MileagePlus members have stepped forward to ask how they can support those in need, and we are proud and humbled to facilitate this critical work."

United is working directly with its partner organizations, as well as engaging with community leaders to assist the impacted communities. Focus areas for some of the airline's partners include:

  • Airlink: Transportation of medical supplies and PPE
  • Americares: Supporting COVID-19 treatment facilities, donating critical medical equipment, PPE and supplies for health workers and educating the community on COVID-19 prevention and vaccination.
  • World Central Kitchen: Hot meal distribution to health care workers by partnering with local restaurants

In addition to its fundraising efforts, United will also continue to leverage its cargo operations to transport greatly needed medical equipment to the region. Between April 28 and May 2, United operated 20 flights that transported more than 300,000 pounds of medical supplies to India. This included donations from the U.S. India Chamber of Commerce and the Indo-American Chamber of Commerce in Houston that brought 50 ventilators through the USICOC Foundation to the Indian Red Cross Society. United is continuing to coordinate humanitarian cargo efforts with partner, Airlink, which provides tactical coordination to help break through supply chain barriers to execute rapid response airlifts of humanitarian aid. United has proudly served India since 2005 and employs more than 300 individuals in the country. The online campaign platform is currently scheduled to be available for donations through June 15. United will continue to evaluate how it can provide support to the region.

About United

United's shared purpose is "Connecting People. Uniting the World." For more information, visit united.com, follow @United on Twitter and Instagram or connect on Facebook. The common stock of UAL 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 Celebrates 40 Years of MileagePlus by Awarding Millions of Miles to Healthcare Workers

Airline celebrates loyalty program anniversary with contest to recognize healthcare workers
May 03, 2021

CHICAGO, May 3, 2021 /PRNewswire/ -- United Airlines is celebrating the 40th anniversary of the MileagePlus® program this month, and to recognize this milestone the airline is giving away four million miles to essential healthcare workers. The contest will recognize four deserving healthcare workers with one million miles each. In addition, United is showing its appreciation to MileagePlus members around the world with domestic and international fare sales, surprise customer giveaways and 10 exclusive promotions with MileagePlus partners.

United Offers MileagePlus Premier Members Bonus Miles and New (Faster) Ways to Earn Premier Status

MileagePlus® Premier® members can "Pick Your Path" with three offers designed to provide value to members whether they're ready to travel now, or if they plan to begin flying at a later date
April 29, 2021

CHICAGO, April 29, 2021 /PRNewswire/ -- United Airlines today introduced three new promotions that let eligible MileagePlus Premier members "Pick Your Path" depending on their upcoming travel plans. The new promotions give members the chance to fast track their Premier status or earn bonus miles and will run from April 29 to July 27, 2021. Offers include:

  • A 'Welcome-back Bonus' promotion that gives members deposits of bonus Premier Qualifying Points (PQPs) for their first three trips.
  • An 'Easy PQP' offer which provides member with a PQP deposit without needing to travel.
  • And an offer which allows members to earn double miles through the MileagePlus X app.

"While demand for travel is steadily increasing, we recognize that different customers are beginning to return to travel at different times," said Luc Bondar United's vice president of marketing and loyalty and President of MileagePlus. "Offering three separate promotions allows us to meet our Premier members where they are and gives our members the opportunity to select an offer that is meaningful to them whether they're ready to travel now or if they'd rather receive miles to save for a trip later on."

Welcome-back Bonus PQP

United is offering an option for eligible Premier members to earn up to 25% of the outright PQPs required for their current status level with the Welcome-back Bonus PQP offer. Combined with the 25% PQP deposit that United gave members at the start of this year, members who choose this option will have the opportunity to earn half of the PQP-only requirement to requalify for their status level.

Easy PQP

Premier members who aren't planning any travel before July 27, 2021 can choose to receive a 10% deposit of the outright PQP requirement for their current status level with the Easy PQP option. Members will automatically receive between 350 and 1,500 PQPs depending on their status level.

Bonus Miles Through MileagePlus X

Eligible U.S.-based Premier members who prefer to save up for their next trip can choose to earn double miles (up to 10,000 bonus miles total) on all transactions made with MileagePlus X. With the MileagePlus X app, members can buy eGift cards from hundreds of merchants, dine at participating restaurants, or shop online and earn miles for each purchase.

Members have until May 13, 2021 to choose their promotion option or they will be automatically enrolled in the Welcome-back Bonus PQP offer. To be eligible, members must have held Premier status on April 19, 2021. Eligible Premier members can visit united.com/pickyourpath or sign into the MileagePlus X app to make their selection.

These new offerings build on announcements United introduced last year including reducing Premier qualifying thresholds, automatically giving members 25% of the PQP requirements for their status level and offering additional promotions for travel earlier this year. To learn about all of the changes United made to its Premier program in the last year visit https://mileageplusupdates.com/.

About United

United's shared purpose is "Connecting People. Uniting the World." For more information, visit united.com, follow @United on Twitter and Instagram or connect on Facebook. The common stock of United's parent, United Airlines 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 Continues to Build Summer Network, Adding Over 480 Daily Flights to its U.S. June Schedule

Airline restarting 16 routes and adding nine new routes to destinations including Hawaii, Alaska and national parks
April 23, 2021

CHICAGO, April 23, 2021 /PRNewswire/ -- In June, United will fly its largest schedule since before the pandemic to meet growing demand for summer travel. The airline is adding more than 480 daily flights to its U.S. schedule to offer an average of over 3,100 total daily domestic flights to more than 240 U.S. destinations. This includes the addition of new flights to Hawaii, Alaska and Montana. Overall, United plans to fly 67% of its domestic schedule and 60% of its overall network schedule compared to its 2019 June schedule.

United Customers Can Now Schedule COVID Tests and be Automatically Cleared for Travel Directly through the Travel-Ready Center

United's industry-leading digital platform gets even more useful with the ability to schedule tests and have results directly verified through United's Travel-Ready Center on web and mobile
April 21, 2021

CHICAGO, April 21, 2021 /PRNewswire/ -- Since the Travel-Ready Center launched in January, United customers have been able to easily access testing or vaccine requirements needed for travel destinations, upload completed testing results and vaccine records as well as have them verified, all within the United App. Today, the industry-leading digital platform gets even better as customers can now choose from more than 200 COVID-19 testing providers across the country, book appointments and receive confirmation whether their test results meet their destination's requirements. Once the test is validated, customers will see a status indicator informing them that they are "travel-ready" and receive their mobile boarding pass. United is the only airline that offers its customers these services as part of an integrated experience within its app and website and since launch, the airline has processed more than 275,000 COVID-19 tests through the Travel-Ready Center.

United Releases First-Quarter Financial Results - Rebounding Demand is Driving Clear Path to Profitability

Expects positive adjusted EBITDA margins* later this year
April 19, 2021

CHICAGO, April 19, 2021 /PRNewswire/ -- United Airlines (UAL) today announced first-quarter 2021 financial results. The company has its eyes on the future, making continued progress on its commitment to remove $2 billion in structural costs and investing in key customer programs that will position the airline to capitalize on the recovery of business travel and long-haul international demand.

United Airlines Adds New Flights to Croatia, Greece and Iceland as Countries Begin to Reopen to Vaccinated Travelers

United is the only airline that allows customers to upload vaccine results within its mobile app and website through the airline's Travel-Ready Center
April 19, 2021

CHICAGO, April 19, 2021 /PRNewswire/ -- United is adding three new flights to its international network, giving travelers more options for summer travel by flying direct to countries that are starting to reopen to vaccinated visitors. Starting in July, United will offer new direct flights from Newark Liberty International Airport to Dubrovnik, Croatia, from Washington Dulles International Airport to Athens, Greece and from Chicago O'Hare International Airport to Reykjavik, Iceland, all subject to government approval.

United Airlines to Lead Industry Switch to Sustainable Aviation Fuel with Global Corporations, Customers

New United Eco-Skies Alliance Program includes global corporate leaders who, with United, will pay towards more sustainable aviation fuel, all companies invited to participate
April 13, 2021

CHICAGO, April 13, 2021 /PRNewswire/ -- United Airlines continues to lead the industry towards a more sustainable future with the launch of the first-of-its-kind Eco-Skies Alliance SM program. Working with the airline, more than a dozen leading global corporations will collectively contribute towards the purchase of approximately 3.4 million gallons of sustainable aviation fuel (SAF) this year. With its nearly 80% emissions reductions on a lifecycle basis compared to conventional jet fuel, this is enough SAF to eliminate approximately 31,000 metric tons of greenhouse gas emissions, or enough to fly passengers over 220 million miles.

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