United second quarter 2016 performance - United Hub

United Airlines Reports Second-Quarter 2016 Performance

July 19, 2016

CHICAGO, July 19, 2016 /PRNewswire/ -- United Airlines (UAL) today reported its second-quarter 2016 financial results.

  • Including special items, UAL reported second-quarter net income of $588 million, earnings per share of $1.78 per diluted share and pre-tax earnings of $931 million.
  • Excluding special items, UAL reported second-quarter net income of $863 million, earnings per share of $2.61 per diluted share and pre-tax earnings of $1.4 billion.
  • During the second quarter of 2016, the company repurchased $694 million of its common stock, representing 4.4 percent of shares outstanding.
  • In July, the company's Board of Directors authorized an additional $2 billion share repurchase program.

 

"We made significant progress in the second quarter as a direct result of the passion and dedication that United's aviation professionals around the world have for running a great airline," said Oscar Munoz, president and chief executive officer of United Airlines. "This progress is exemplified by the best six months of operational performance in our history and we will continue down the path of unlocking United's full potential."

Second-Quarter Revenue

For the second quarter of 2016, total revenue was $9.4 billion, a decrease of 5.2 percent year-over-year. Second-quarter 2016 consolidated passenger revenue per available seat mile (PRASM) decreased 6.6 percent and consolidated yield decreased 6.1 percent compared to the second quarter of 2015. The decline in PRASM continues to be driven by factors including a strong U.S. dollar, lower surcharges, travel reductions from customers impacted by declining oil prices, competitive actions and higher-yielding demand not keeping pace with industry capacity.

Second-Quarter Costs

Total operating expense including special charges was $8.3 billion in the second quarter, down 1.6 percent year-over-year. Excluding special charges, total operating expense was $7.9 billion, a 6.1 percent decrease year-over-year. Consolidated unit cost (CASM) including special charges, third-party business expenses, fuel and profit sharing decreased 1.6 percent compared to the second quarter of 2015 due mainly to lower oil prices. Consolidated CASM, excluding special charges, third-party business expenses, fuel and profit sharing, increased 2.5 percent year-over-year driven largely by the impact of recently ratified labor agreements.

Liquidity and Capital Allocation

In the second quarter, UAL generated $2.5 billion in operating cash flow and ended the quarter with $6.0 billion in unrestricted liquidity, including $1.35 billion of undrawn commitments under its revolving credit facility. The company continued to invest in its business through capital expenditures of $838 million in the second quarter. Including assets acquired through the issuance of debt and airport construction financing and excluding fully reimbursable projects, the company invested $767 million in adjusted capital expenditures during the second quarter. Free cash flow, measured as operating cash flow less adjusted capital expenditures, was $1.8 billion in the second quarter.

For the 12 months ended June 30, 2016, the company's return on invested capital was 20.7 percent.

In the quarter, UAL repurchased $694 million worth of its common stock, representing 4.4 percent of shares outstanding. As of June 30, 2016, the company had $255 million remaining to purchase shares under its existing share repurchase programs.

UAL's Board of Directors authorized an additional $2 billion share repurchase program. This amount represents approximately 13 percent of the company's market capitalization as of the closing stock price on July 18, 2016.

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

Second-Quarter Highlights

Operations and Employees

  • Reached a tentative joint agreement with flight attendants.
  • IAM-represented employees ratified agreements.
  • Reported best six-month on-time performance and finished first or second in on-time arrivals among the four largest U.S. network carriers each month.
  • Achieved best quarterly mishandled bag rate, keeping more customers connected with their bags than ever before.
  • Employees earned cash-incentive payments of approximately $30 million for achieving operational performance goals.

Finance, Network and Fleet

  • Outlined initiatives the company is implementing to improve financial performance including commercial enhancements, cost structure improvements and operational improvement expected to drive $3.1 billion in incremental value by 2018.
  • Launched new international routes between San Francisco and Singapore and between San Francisco and Xi'an, China.
  • Took delivery of two Boeing 737-800 aircraft, two Boeing 787-9 aircraft and added 12 Embraer 175 aircraft to its United Express fleet.

Customer Experience

  • Achieved the greatest year-over-year customer satisfaction score improvement in the company's history, up 6.7 points compared to the second quarter of 2015.
  • Completed Wi-Fi installations on 100 percent of domestic and international mainline aircraft, making UAL the first U.S. airline to complete Wi-Fi installations on its international fleet.
  • Unveiled a reimagined international travel experience – United Polaris business class.

About United

United Airlines and United Express operate more than 4,500 flights a day to 339 airports across five 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 720 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. 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 current and future events and financial 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" 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, 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); 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; 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 Item 1A., Risk Factors, of UAL's Annual Report on Form 10-K for the fiscal year ended December 31, 2015, 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 SIX MONTHS ENDED June 30, 2016 AND 2015


(In millions, except per share data)

  Three Months Ended
June 30, 2016
Three Months Ended
June 30, 2015
%
Increase/
(Decrease)

Six Months Ended
June 30, 2016
Six Months Ended
June 30, 2015
%
Increase/
(Decrease)

Operating revenue:
Passenger: (A)
Mainline

$6,525 $6,961 (6.3) $12,102 $12,899 (6.2)
Operating revenue: Passenger: (A) Regional 1,578 1,715 (8.0) 2,991 3,197 (6.4)
Operating revenue: Passenger: (A) Total passenger revenue 8,103 8,676 (6.6) 15,093 16,096 (6.2)
Operating revenue: Cargo 208 229 (9.2) 402 471 (14.6)
Operating revenue: Other operating revenue 1,085 1,009 7.5 2,096 1,955 7.2
Operating revenue:Other operating revenue: Total operating revenue 9,396 9,914 (5.2) 17,591 18,522 (5.0)
Operating expense:
Salaries and related costs
2,592 2,454 5.6 5,082 4,755 6.9
Operating expense: Aircraft fuel(B) 1,437 2,106 (31.8) 2,655 3,970 (33.1)
Operating expense: Regional capacity purchase 551 583 (5.5) 1,073 1,153 (6.9)
Operating expense: Landing fees and other rent 541 553 (2.2) 1,066 1,096 (2.7)
Operating expense: Depreciation and amortization 491 445 10.3 970 874 11.0
Operating expense: Aircraft maintenance materials and outside repairs 448 431 3.9 850 828 2.7
Operating expense: Distribution expenses 339 348 (2.6) 642 660 (2.7)
Operating expense: Aircraft rent 175 194 (9.8) 353 395 (10.6)
Operating expense: Special charges (C) 434 55 NM1 624 119 NM1
Operating expense: Other operating expenses 1,328 1,300 2.2 2,567 2,486 3.3
Operating expense: Other Operating Expenses: Total operating expenses 8,336 8,469 (1.6) 15,882 16,336 (2.8)
Operating income 1,060 1,445 (26.6) 1,709 2,186 (21.8)
Nonoperating income (expense):
Interest expense
(157) (167) (6.0) (316) (340) (7.1)
Nonoperating income (expense): Interest capitalized 14 13 7.7 28 25 12.0
Nonoperating income (expense): Interest income 9 6 50.0 17 11 54.5
Nonoperating income (expense): Miscellaneous, net (C) 5 (100) NM1 (13) (174) (92.5)
Nonoperating income (expense): Miscellaneous, net (C): Total nonoperating expense (129) (248) (48.0) (284) (478) (40.6)
Income before income taxes: Income before income taxes 931 1,197 (22.2) 1,425 1,708 (16.6)
Income tax expense: Income tax expense (benefit) (D) 343 4 NM1 524 7 NM1
Net income: Net income $588 $1,193 (50.7) $901 $1,701 (47.0)
Earnings per share: Earnings per share, basic $1.78 $3.14 (43.3) $2.63 $4.46 (41.0)
Earnings per share: Earnings per share, diluted $1.78 $3.14 (43.3) $2.63 $4.45 (40.9)
Weighted average shares: Weighted average shares, basic 331 380 (12.9) 342 381 (10.2)
Weighted average shares: Weighted average shares, diluted 331 380 (12.9) 343 382 (10.2)
  1. NM means Not Meaningful

 

UNITED CONTINENTAL HOLDINGS, INC.
NOTES (UNAUDITED)

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


  2Q 2016
Passenger
Revenue
(millions)


Passenger
Revenue
vs.
2Q 2015


PRASM
vs.
2Q 2015

Yield
vs.
2Q 2015

Available
Seat Miles
vs.
2Q 2015


Domestic $3,393 (3.7%) (4.6%) (4.7%) 0.9%
Atlantic 1,506 (7.9%) (10.3%) (4.8%) 2.7%
Pacific 1,013 (8.6%) (7.6%) (8.0%) (1.1%)
Latin America 613 (11.8%) (10.5%) (13.5%) (1.5%)
International 3,132 (8.9%) (9.3%) (7.8%) 0.5%
Mainline 6,525 (6.3%) (6.9%) (6.2%) 0.7%
Regional 1,578 (8.0%) (3.4%) (4.2%) (4.8%)
Consolidated $8,103 (6.6%) (6.6%) (6.1%) 0.1%

 

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
June 30, 2016
Three Months Ended
June 30, 2015
%
Increase/
(Decrease)

Six Months Ended
June 30, 2016
Six Months Ended
June 30, 2015
%
Increase/
(Decrease)

Mainline fuel expense excluding hedge impacts $1,166 $1,648 (29.2) $2,051 $3,044 (32.6)
Hedge losses reported in fuel expense 2 (35) (118) NM1 (173) (279) NM1
Total mainline fuel expense 1,201 1,766 (32.0) 2,224 3,323 (33.1)
Regional fuel expense 236 340 (30.6) 431 647 (33.4)
Consolidated fuel expense 1,437 2,106 (31.8) 2,655 3,970 (33.1)
Cash paid on settled hedges that did not qualify for hedge accounting 3 (75) NM1 (5) (114) NM1
Fuel expense including all losses from settled hedgesFuel expense including all losses from settled hedges $1,437 $2,181 (34.1) $2,660 $4,084 (34.9)
Mainline fuel consumption (gallons) 834 833 0.1 1,568 1,570 (0.1)
Mainline average aircraft fuel price per gallon $1.44 $2.12 (32.1) $1.42 $2.12 (33.0)
Mainline average aircraft fuel price per gallon excluding hedge losses recorded in fuel expense $1.40 $1.98 (29.3) $1.31 $1.94 (32.5)
Mainline average aircraft fuel price per gallon including cash paid on settled hedges that did not qualify for hedge accounting $1.44 $2.21 (34.8) $1.42 $2.19 (35.2)
Regional fuel consumption (gallons) 161 171 (5.8) 317 330 (3.9)
Regional average aircraft fuel price per gallon $1.47 $1.99 (26.1) $1.36 $1.96 (30.6)
Consolidated fuel consumption (gallons) 995 1,004 (0.9) 1,885 1,900 (0.8)
Consolidated average aircraft fuel price per gallon $1.44 $2.10 (31.4) $1.41 $2.09 (32.5)
Consolidated average aircraft fuel price per gallon excluding hedge losses recorded in fuel expense $1.41 $1.98 (28.8) $1.32 $1.94 (32.0)
Consolidated average aircraft fuel price per gallon including cash paid on settled hedges that did not qualify for hedge accounting $1.44 $2.17 (33.6) $1.41 $2.15 (34.4)
  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
June 30, 2016 (In millions)
Three Months Ended
June 30, 2015 (In millions)
Six Months Ended
June 30, 2016 (In millions)
Six Months Ended
June 30, 2015 (In millions)
Operating:
Impairment of intangible asset related to Newark Liberty International Airport (Newark) slots
$412 $ — $412 $ —
Operating:
Labor agreement costs
10 110
Operating:Severance and benefit costs 6 25 14 75
Operating:Cleveland airport lease restructuring 74
Operating:(Gains) losses on sale of assets and other special charges 6 30 14 44
Operating: (Gains) losses on sale of assets and other special charges:Special charges 434 55 624 119
Nonoperating and income taxes:
(Gain) Loss on extinguishment of debt and other
(9) 128 (1) 134
Nonoperating and income taxes:Income tax benefit related to special charges (153) (225)
Nonoperating and income taxes:Total operating and nonoperating special charges, net of income taxes 272 183 398 253
Nonoperating and income taxes:Mark-to-market (MTM) losses from fuel derivative contracts settling in future periods (26) (7)
Nonoperating and income taxes:Prior period gains (losses) on fuel derivative contracts settled in the current period 3 (90) (1) (105)
Nonoperating and income taxes:Total special items, net of income taxes $275 $67 $397 $141

 

 
   
 

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 (IAM) ratified seven new contracts with the company which extended the contracts through 2021. The company also reached a tentative agreement with the Int'l Brotherhood of Teamsters (IBT). During the three and Six months ended June 30, 2016, the company recorded $61 million ($39 million net of taxes) and $171 million ($109 million net of taxes), respectively, of special charges primarily for payments to be made in conjunction with the IAM and IBT agreements described above. Also, as part of the recently ratified contract with the Association of Flight Attendants, the company amended two of its flight attendant postretirement medical plans. The amendments triggered curtailment accounting, resulting in the recognition of a one-time $47 million gain ($30 million net of taxes) for accelerated recognition of a prior service credit.

   
 

Severance and benefit costs: During the three and Six months ended June 30, 2016, the company recorded $13 million ($8 million net of taxes) and $27 million ($17 million net of taxes), respectively, of severance and benefit costs related to a voluntary early-out program for the company's flight attendants and other severance agreements. In 2014, more than 2,500 flight attendants elected to voluntarily separate from the company for 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.

   
 

Impairment of intangible asset related to Newark slots: In April 2016, the Federal Aviation Administration (FAA) announced that it will designate Newark as a Level 2 schedule-facilitated airport under the International Air Transport Association Worldwide Slot Guidelines effective October 30, 2016. The designation was associated with an updated demand and capacity analysis of Newark by the FAA. In the second quarter of 2016, the company determined that the FAA's action impaired the entire value of its Newark slots because the slots will no longer be the mechanism that governs take-off and landing rights. Accordingly, the company recorded a $412 million special charge ($264 million net of taxes) to write off the intangible asset. The Newark slots served as part of the collateral for the term loans under the company's Credit Agreement and under the Second Amended and Restated Co-Branded Card Marketing Services Agreement with Chase Bank USA, N.A. (the Chase Agreement). The Credit Agreement and the Chase Agreement have been amended to remove the Newark slots as collateral with no replacement collateral required.

   
 

Cleveland airport lease restructuring: During the Six months ended June 30, 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. 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 recorded a net charge of $74 million ($47 million net of taxes) related to the amended lease.

   
 

(Gains) losses on sale of assets and other special charges: During the three and Six months ended June 30, 2016, the company recorded gains and losses on sale of assets and other special charges of $18 million ($12 million net of taxes) and $32 million ($20 million net of taxes), respectively.

   
 

Nonoperating losses on extinguishment of debt and other: During the Six months ended June 30, 2016, the company recorded $8 million ($5 million net of taxes) of losses due to exchange rate changes in Venezuela applicable to funds held in local currency and recorded a $9 million ($6 million net of taxes) gain on the sale of an affiliate.

   
 

MTM losses from fuel derivative contracts settling in future periods and prior period gains 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 and Six months ended June 30, 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 and Six months ended June 30, 2016, the company recorded MTM gains of $3 million and $2 million, respectively, in prior periods.

   
 

2015 - Special items

   
 

Severance and benefit costs: During the three and Six months ended June 30, 2015, the company recorded $28 million and $103 million, respectively, 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 for 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 and Six months ended June 30, 2015, the company recorded $48 million and $92 million, respectively, for integration costs, impairment of assets and other special gains and losses.

   
 

Nonoperating loss on extinguishment of debt and other: During the third quarter of 2015, the company recorded $61 million of losses due to exchange rate changes in Venezuela applicable to funds held in local currency. During the Six months ended June 30, 2015, the company recorded a charge of $134 million due to the write-off of the unamortized non-cash debt discount related to the extinguishment of the 6% Notes due 2026 and 6% Notes due 2028. Both of the charges were recorded as part of Nonoperating income (expense): Miscellaneous, net.

   
 

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 and Six months ended June 30, 2015, the company recorded $36 million and $28 million, respectively, in MTM losses on fuel derivative contracts that will settle in future periods. For fuel derivative contracts that settled in the three and Six months ended June 30, 2015, the company recorded MTM losses of $69 million and $173 million, respectively, in prior periods.

   

(D)  

The company's effective tax rate for the three and Six months ended June 30, 2016 was 36% which represented a blend of federal, state and foreign taxes and the impact of certain nondeductible items. During 2015, after considering all positive and negative evidence, the company concluded that its deferred income taxes would more likely than not be realized. The company released substantially all of its valuation allowance in the third quarter of 2015, which resulted in a $3.2 billion benefit in its provision for income taxes.

 

UNITED CONTINENTAL HOLDINGS, INC.
STATISTICS
  Three Months Ended
June 30, 2016
Three Months Ended
June 30, 2015
%
Increase/
(Decrease)

Six Months Ended
June 30, 2016
Six Months Ended
June 30, 2015
%
Increase/
(Decrease)

Mainline:
Passengers (thousands)
25,639 24,858 3.1 47,916 46,236 3.6
Mainline:Revenue passenger miles (millions) 47,842 47,859 88,698 88,519 0.2
Mainline:Available seat miles (millions) 57,452 57,048 0.7 108,617 107,173 1.3
Mainline:Cargo ton miles (millions) 679 633 7.3 1,301 1,295 0.5
Mainline:Passenger load factor:
Mainline
83.3% 83.9% (0.6) pts. 81.7% 82.6% (0.9) pts.
Mainline:Domestic 86.8% 86.6% 0.2 pts. 85.2% 85.6% (0.4) pts.
Mainline:International 79.9% 81.3% (1.4) pts. 78.3% 79.8% (1.5) pts.
Mainline:Passenger revenue per available seat mile (cents) 11.36 12.20 (6.9) 11.14 12.04 (7.5)
Mainline:Average yield per revenue passenger mile (cents) 13.64 14.54 (6.2) 13.64 14.57 (6.4)
Mainline:Aircraft in fleet at end of period 720 708 1.7 720 708 1.7
Mainline:Average stage length (miles) 1,890 1,939 (2.5) 1,875 1,928 (2.7)
Mainline:Average daily utilization of each aircraft (hours) 10:38 10:54 (2.4) 10:07 10:25 (2.9)
Regional:
Passengers (thousands)
10,777 11,373 (5.2) 20,587 21,517 (4.3)
Regional:Revenue passenger miles (millions) 6,175 6,430 (4.0) 11,901 12,214 (2.6)
Regional:Available seat miles (millions) 7,273 7,637 (4.8) 14,381 14,781 (2.7)
Regional:Passenger load factor 84.9% 84.2% 0.7 pts. 82.8% 82.6% 0.2 pts.
Regional:Passenger revenue per available seat mile (cents) 21.70 22.46 (3.4) 20.80 21.63 (3.8)
Regional:Average yield per revenue passenger mile (cents) 25.55 26.67 (4.2) 25.13 26.17 (4.0)
Regional:Aircraft in fleet at end of period 494 522 (5.4) 494 522 (5.4)
Regional:Average stage length (miles) 565 558 1.3 570 560 1.8
Consolidated (Mainline and Regional):
Passengers (thousands)
36,416 36,231 0.5 68,503 67,753 1.1
Consolidated (Mainline and Regional)Revenue passenger miles (millions) 54,017 54,289 (0.5) 100,599 100,733 (0.1)
Consolidated (Mainline and Regional)Available seat miles (millions) 64,725 64,685 0.1 122,998 121,954 0.9
Consolidated (Mainline and Regional)Passenger load factor 83.5% 83.9% (0.4) pts. 81.8% 82.6% (0.8) pts.
Consolidated (Mainline and Regional)Passenger revenue per available seat mile (cents) 12.52 13.41 (6.6) 12.27 13.20 (7.0)
Consolidated (Mainline and Regional)Total revenue per available seat mile (cents) 14.52 15.33 (5.3) 14.30 15.19 (5.9)
Consolidated (Mainline and Regional)Average yield per revenue passenger mile (cents) 15.00 15.98 (6.1) 15.00 15.98 (6.1)
Consolidated (Mainline and Regional)Aircraft in fleet at end of period 1,214 1,230 (1.3) 1,214 1,230 (1.3)
Consolidated (Mainline and Regional)Average stage length (miles) 1,496 1,500 (0.3) 1,479 1,488 (0.6)
Consolidated (Mainline and Regional)Average full-time equivalent employees (thousands) 83.2 82.3 1.1 82.8 82.0 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, as adjusted, among others. CASM is a common metric used in the airline industry to measure an airline's cost structure and efficiency. UAL reports CASM excluding profit sharing, third-party business expenses, fuel and special charges. 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 charges 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 assets acquired through the issuance of debt, 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.

 

UNITED CONTINENTAL HOLDINGS, INC.
NON-GAAP FINANCIAL RECONCILIATION (Continued)
  Three Months Ended
June 30, 2016 (In millions)
Three Months Ended
June 30, 2015 (In millions)
$
Increase/
(Decrease)

%
Increase/
(Decrease)

Six Months Ended
June 30, 2016 (In millions)
Six Months Ended
June 30, 2015 (In millions)
$
Increase/
(Decrease)

%
Increase/
(Decrease)

Operating expenses $8,336 $8,469 $(133) (1.6) $15,882 $16,336 $(454) (2.8)
Operating expenses:Less: Special charges (C) 434 55 379 NM1 624 119 505 NM1
Operating expenses, excluding special charges 7,902 8,414 (512) (6.1) 15,258 16,217 (959) (5.9)
Operating expenses, excluding special charges:Less: Third-party business expenses 60 69 (9) (13.0) 127 135 (8) (5.9)
Operating expenses, excluding special charges:Less: Fuel expense 1,437 2,106 (669) (31.8) 2,655 3,970 (1,315) (33.1)
Operating expenses, excluding special charges:Less: Profit sharing, including taxes 209 198 11 5.6 302 268 34 12.7
Operating expensesOperating expenses, excluding fuel, profit sharing, special charges and third-party business expenses $6,196 $6,041 $155 2.6 $12,174 $11,844 $330 2.8
Operating incomeIncome before income taxes $931 $1,197 $(266) (22.2) $1,425 $1,708 $(283) (16.6)
Operating incomeLess: special items before income taxes (C) 428 67 361 NM1 622 141 481 NM1
Operating incomeIncome before income taxes and excluding special items $1,359 $1,264 $95 7.5 $2,047 $1,849 $198 10.7
Operating incomeNet income $588 $1,193 $(605) (50.7) $901 $1,701 $(800) (47.0)
Operating incomeLess: special items, net of tax (C) 275 67 208 NM1 397 141 256 NM1
Operating incomeNet income, excluding special items $863 $1,260 $(397) (31.5) $1,298 $1,842 $(544) (29.5)
Diluted earnings per shareDiluted earnings per share $1.78 $3.14 $(1.36) (43.3) $2.63 $4.45 $(1.82) (40.9)
Diluted earnings per shareAdd back: special items 1.29 0.17 1.12 NM1 1.82 0.37 1.45 NM1
Diluted earnings per shareTax effect related to special items (0.46) (0.46) NM1 (0.66) (0.66) NM1
Diluted earnings per shareDiluted earnings per share, excluding special items $2.61 $3.31 $(0.70) (21.1) $3.79 $4.82 $(1.03) (21.4)

 

UNITED CONTINENTAL HOLDINGS, INC.
NON-GAAP FINANCIAL RECONCILIATION (Continued)
  Three Months Ended
June 30, 2016 in cents
Three Months Ended
June 30, 2015 in cents
%
Increase/
(Decrease)

Six Months Ended
June 30, 2016 in cents
Six Months Ended
June 30, 2015 in cents
%
Increase/
(Decrease)

CASM Mainline Operations (cents)
Cost per available seat mile (CASM)
12.39 12.42 (0.2) 12.43 12.69 (2.0)
CASM Mainline Operations (cents): Cost per available seat mile (CASM)Less: Special charges (C) 0.76 0.10 NM1 0.58 0.12 NM1
CASM Mainline Operations (cents): Cost per available seat mile (CASM)CASM, excluding special charges 11.63 12.32 (5.6) 11.85 12.57 (5.7)
CASM Mainline Operations (cents): CASM, excluding special chargesLess: Third-party business expenses 0.10 0.12 (16.7) 0.11 0.12 (8.3)
CASM Mainline Operations (cents): CASM Mainline OperationsCASM, excluding special charges and third-party business expenses 11.53 12.20 (5.5) 11.74 12.45 (5.7)
CASM Mainline Operations (cents): CASM, excluding special charges and third-party business expensesLess: Fuel expense 2.09 3.10 (32.6) 2.05 3.10 (33.9)
CASM Mainline Operations (cents): CASM Mainline OperationsCASM, excluding special charges, third-party business expenses and fuel 9.44 9.10 3.7 9.69 9.35 3.6
CASM Mainline Operations (cents): CASM, excluding special charges, third-party business expenses and fuelLess: Profit sharing per available seat mile 0.36 0.34 5.9 0.28 0.25 12.0
CASM Mainline Operations (cents): CASM Mainline OperationsCASM, excluding special charges, third-party business expenses, fuel, and profit sharing 9.08 8.76 3.7 9.41 9.10 3.4
CASM Consolidated Operations (cents)
Cost per available seat mile (CASM)
12.88 13.09 (1.6) 12.91 13.40 (3.7)
CASM Consolidated Operations (cents): Cost per available seat mile (CASM)Less: Special charges (C) 0.67 0.08 NM1 0.50 0.10 NM1
CASM Consolidated Operations (cents): CASM, excluding special charges 12.21 13.01 (6.1) 12.41 13.30 (6.7)
CASM Consolidated Operations (cents): CASM, excluding special chargesLess: Third-party business expenses 0.09 0.11 (18.2) 0.11 0.11
CASM Consolidated Operations (cents): CASM, excluding special charges and third-party business expenses 12.12 12.90 (6.0) 12.30 13.19 (6.7)
CASM Consolidated Operations (cents): CASM, excluding special charges and third-party business expensesLess: Fuel expense 2.22 3.25 (31.7) 2.16 3.26 (33.7)
CASM Consolidated Operations (cents): CASM, excluding special charges, third-party business expenses and fuel 9.90 9.65 2.6 10.14 9.93 2.1
CASM Consolidated Operations (cents): CASM, excluding special charges, third-party business expenses and fuelLess: Profit sharing per available seat mile 0.33 0.31 6.5 0.24 0.22 9.1
CASM Consolidated Operations (cents): CASM, excluding special charges, third-party business expenses, fuel, and profit sharing 9.57 9.34 2.5 9.90 9.71 2.0

 

UNITED CONTINENTAL HOLDINGS, INC.
CAPITAL EXPENDITURES AND FREE CASH FLOW
Capital Expenditures (in millions) Three Months Ended
June 30, 2016
Six Months Ended
June 30, 2016
Capital Expenditures:Capital expenditures – GAAP $838 $1,654
Capital Expenditures: Capital expenditures – GAAP:Property and equipment acquired through the issuance of debt 59
Capital Expenditures: Capital expenditures – GAAP:Airport construction financing 26 35
Capital Expenditures: Capital expenditures – GAAP:Fully reimbursable projects (97) (158)
Capital Expenditures:Adjusted capital expenditures – Non-GAAP $767 $1,590
Free Cash Flow (in millions) Three Months Ended
June 30, 2016
Six Months Ended
June 30, 2016
Free Cash Flow (in millions):Net cash provided by operating activities $2,547 $3,746
Free Cash Flow (in millions): Net cash provided by operating activities:Less adjusted capital expenditures – Non-GAAP 767 1,590
Free Cash Flow (in millions):Free cash flow - Non-GAAP $1,780 $2,156

 

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
June 30, 2016
Return On Invested CapitalNet Operating Profit After Tax (NOPAT)
Pre-tax income excluding special items 4
$4,696
Return On Invested CapitalNOPAT adjustments 5 1,056
Return On Invested CapitalNOPAT $5,752
Return On Invested CapitalEffective cash tax rate 6 0.3%
Return On Invested CapitalInvested Capital (five-quarter average)
Total assets
$40,394
Return On Invested CapitalInvested capital adjustments 7 12,581
Return On Invested CapitalAverage Invested Capital $27,813
Return On Invested CapitalReturn on Invested Capital 20.7%
  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
June 30, 2016
Pre-tax income $3,936
Return On Invested CapitalAdd: Special items 760
Return On Invested CapitalPre-tax income excluding special items $4,696

 

Photo - http://photos.prnewswire.com/prnh/20161016/429327-INFO

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 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.1 UAL 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

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".

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-

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)




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.



(C) 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 ($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

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 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 StubHubTM, offering UnitedSM Chase Visa Cardmembers even more ways to earn miles.

App enhancements

  • MileagePlus DiningSM: 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 UnitedSM 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

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".

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

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".



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

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".

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

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, 872-825-8640, media.relations@united.com

United Airlines Named Best Overall Frequent Flyer Program in the World for 15th Consecutive Year

December 20, 2018

CHICAGO, Dec. 20, 2018 /PRNewswire/ -- For the 15th consecutive year, readers of Global Traveler, a monthly publication written exclusively for frequent business and luxury travelers, voted United's MileagePlus loyalty program the Best Overall Frequent-Flyer Program in the world. United has been recognized with this distinction every year since the inception of the GT Tested Reader Survey in 2004.

In the survey completed by frequent business and luxury travelers, United's MileagePlus program was also named the Best Frequent-Flyer Bonus Program for the sixth consecutive year.

Additionally, the United MileagePlus Club Card from Chase was named Best Credit Card and Best Credit Card Rewards Program, both for the seventh consecutive year.

"It is an honor that United's MileagePlus loyalty program is consistently recognized by Global Traveler as the Best Frequent Flyer Program. It represents our continued commitment to our MileagePlus members and credit card holders," said Luc Bondar, United's vice president of loyalty. "We are proud to offer a service that continues to be consistent and meets the standards our members expect."

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 variety of options for using those award miles, including to pay for travel, hotel stays, car rentals and merchandise.

United continues to enhance its MileagePlus program, offering members new ways to earn and redeem miles as well as increased benefits. Highlights from the last 12 months include:

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".

 

SOURCE United Airlines

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

The More the Merrier - United Airlines Adds 11 New Routes from Chicago, Houston, Los Angeles and Washington, D.C.

December 19, 2018

CHICAGO, Dec. 19, 2018 /PRNewswire/ -- United Airlines today announced the addition of 11 new routes from its hubs in Chicago, Houston, Los Angeles and Washington, D.C. United'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. Tickets are now available for purchase.

In 2018, United introduced 93 new routes across the United States, including 15 international routes – adding more flights than any U.S. airline. Today's additions are part of United's 78 domestic routes announced this year and build on the airline's record network expansion.

"We are focused on giving our customers more reasons to choose to fly United Airlines," said Ankit Gupta, United's vice president of Domestic Network Planning and Scheduling. "With nearly 100 new routes announced this year, we continue to deliver on our commitment to build a global network with destinations where our customers want to fly."

Chicago to Colorado, Florida, Oregon and Nova Scotia

From United's hometown hub, the airline will offer seven new routes connecting customers to Florida beaches, Oregon's Willamette Valley and Cascade Mountains and the Colorado Rocky Mountains. Additionally, beginning June 6, United will offer daily service to the stunning coastline and scenery of Halifax on the Nova Scotia peninsula in Canada. 

City

Depart

Arrive

Frequency

Aircraft

Chicago-Destin

 9:15 a.m.

11:41 a.m.

Saturday, Sunday

CRJ-200

Destin-Chicago

 12:15 p.m.

2:55 p.m.

Saturday, Sunday

CRJ-200

Chicago-Durango

 10:00 am

12:12 pm

Saturday

CRJ-700 

Durango-Chicago

 12:50 p.m.

4:40 p.m.

Saturday

CRJ-700

Chicago-Panama City Beach

 9:15 a.m.

11:41 a.m.

Saturday, Sunday

CRJ-200

Panama City Beach-Chicago

 12:15 p.m.

2:55 p.m.

Saturday, Sunday

CRJ-200

Chicago-Grand Junction

 10:00 a.m.

12:12 p.m.

Saturday

CRJ-700

Grand Junction-Chicago

 12:50 p.m.

4:40 p.m.

Saturday

CRJ-700

Chicago-Eugene

 7:30 p.m.

9:50 p.m.

Daily, year-round

EMB-175

Eugene-Chicago

 11:40 p.m.

5:15 a.m. + 1 day

Daily, year-round

EMB-175

Chicago-Halifax, Nova Scotia

5:50 p.m. 

10:52 p.m.

Daily, Summer

EMB-175

Halifax, Nova Scotia-Chicago

 7:14 a.m.

8:40 a.m.

Daily, Summer

EMB-175

Chicago-Redmond

 7:30 p.m.

9:45 p.m.

Daily, Summer

EMB-175

Redmond-Chicago

 11:45 p.m.

5:15 a.m. + 1 day

Daily, Summer

EMB-175

Houston to Durango, Colorado, and Ontario, California

United's new service between its Houston hub at George Bush Intercontinental Airport offers customers nonstop access for the summer season to outdoor summer fun in Durango and southwestern Colorado's San Juan mountain range. United will also begin daily, year-round service between Houston and Ontario in southern California. From Ontario, customers can easily access four major interstates, including easy access to Los Angeles and Long Beach.

City

Depart

Arrive

Frequency

Aircraft

Houston-Durango

 9:35 a.m.

10:55 a.m.

Saturday

EMB-175

Durango-Houston

 12:20 p.m.

3:35 p.m.

Saturday

EMB-175

Houston-Ontario

9:30 p.m.

11:15 p.m.

Daily, year-round

EMB-175

Ontario-Houston

 11:59 p.m.

5:10 a.m.+ 1 day

Daily, year-round

EMB-175

Los Angles to Stockton, California

Beginning Aug. 20, 2019, United's new, twice-daily service between Los Angeles and Stockton will provide Stockton travelers seamless access to United's global network at its Los Angeles hub.

City

Depart

Arrive

Frequency

Aircraft

Los Angeles-Stockton

 1:00 p.m.

5:10 p.m.

2:22 p.m.

6:32 p.m.

Daily, year-round

CRJ-200 

Stockton-Los Angeles

 7:41 a.m.

3:00 p.m.

9:10 a.m. 

4:29 p.m.

Daily, year-round

 CRJ-200

Washington Dulles to Traverse City, Michigan

Located on the eastern shores of Lake Michigan, picturesque Traverse City is an ideal destination for a summer vacation. In fact, fans of the National Cherry Blossom Festival in Washington can follow up with a trip to Traverse City, home of the annual week-long National Cherry Festival in July. United customers traveling between Washington, D.C. and Traverse City will enjoy the area's freshwater beaches, vineyards and nearby national forest and state park.

City

Depart

Arrive

Frequency

Aircraft


Washington Dulles-Traverse City

 9:00 a.m.

11:00 a.m.

Saturday

EMB-145


Traverse City-Washington Dulles

 1:45 pm

3:45 pm

Saturday

EMB-145


Booking summer travel is an opportunity for United MileagePlus members to enjoy the benefits and perks of their membership. Whether it's a trip for business or a vacation getaway with friends or family, MileagePlus Premier and eligible United MileagePlus Chase cardmembers can book Everyday Awards on flights operated by United and United Express.

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."

 

SOURCE United Airlines

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

The More the Merrier - United Airlines Adds 11 New Routes from Chicago, Houston, Los Angeles and Washington, D.C.

December 19, 2018

CHICAGO, Dec. 19, 2018 /PRNewswire/ -- United Airlines today announced the addition of 11 new routes from its hubs in Chicago, Houston, Los Angeles and Washington, D.C. United'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. Tickets are now available for purchase.

In 2018, United introduced 93 new routes across the United States, including 15 international routes – adding more flights than any U.S. airline. Today's additions are part of United's 78 domestic routes announced this year and build on the airline's record network expansion.

"We are focused on giving our customers more reasons to choose to fly United Airlines," said Ankit Gupta, United's vice president of Domestic Network Planning and Scheduling. "With nearly 100 new routes announced this year, we continue to deliver on our commitment to build a global network with destinations where our customers want to fly."

Chicago to Colorado, Florida, Oregon and Nova Scotia

From United's hometown hub, the airline will offer seven new routes connecting customers to Florida beaches, Oregon's Willamette Valley and Cascade Mountains and the Colorado Rocky Mountains. Additionally, beginning June 6, United will offer daily service to the stunning coastline and scenery of Halifax on the Nova Scotia peninsula in Canada. 

City

Depart

Arrive

Frequency

Aircraft

Chicago-Destin

 9:15 a.m.

11:41 a.m.

Saturday, Sunday

CRJ-200

Destin-Chicago

 12:15 p.m.

2:55 p.m.

Saturday, Sunday

CRJ-200

Chicago-Durango

 10:00 am

12:12 pm

Saturday

CRJ-700 

Durango-Chicago

 12:50 p.m.

4:40 p.m.

Saturday

CRJ-700

Chicago-Panama City Beach

 9:15 a.m.

11:41 a.m.

Saturday, Sunday

CRJ-200

Panama City Beach-Chicago

 12:15 p.m.

2:55 p.m.

Saturday, Sunday

CRJ-200

Chicago-Grand Junction

 10:00 a.m.

12:12 p.m.

Saturday

CRJ-700

Grand Junction-Chicago

 12:50 p.m.

4:40 p.m.

Saturday

CRJ-700

Chicago-Eugene

 7:30 p.m.

9:50 p.m.

Daily, year-round

EMB-175

Eugene-Chicago

 11:40 p.m.

5:15 a.m. + 1 day

Daily, year-round

EMB-175

Chicago-Halifax, Nova Scotia

5:50 p.m. 

10:52 p.m.

Daily, Summer

EMB-175

Halifax, Nova Scotia-Chicago

 7:14 a.m.

8:40 a.m.

Daily, Summer

EMB-175

Chicago-Redmond

 7:30 p.m.

9:45 p.m.

Daily, Summer

EMB-175

Redmond-Chicago

 11:45 p.m.

5:15 a.m. + 1 day

Daily, Summer

EMB-175

Houston to Durango, Colorado, and Ontario, California

United's new service between its Houston hub at George Bush Intercontinental Airport offers customers nonstop access for the summer season to outdoor summer fun in Durango and southwestern Colorado's San Juan mountain range. United will also begin daily, year-round service between Houston and Ontario in southern California. From Ontario, customers can easily access four major interstates, including easy access to Los Angeles and Long Beach.

City

Depart

Arrive

Frequency

Aircraft

Houston-Durango

 9:35 a.m.

10:55 a.m.

Saturday

EMB-175

Durango-Houston

 12:20 p.m.

3:35 p.m.

Saturday

EMB-175

Houston-Ontario

9:30 p.m.

11:15 p.m.

Daily, year-round

EMB-175

Ontario-Houston

 11:59 p.m.

5:10 a.m.+ 1 day

Daily, year-round

EMB-175

Los Angles to Stockton, California

Beginning Aug. 20, 2019, United's new, twice-daily service between Los Angeles and Stockton will provide Stockton travelers seamless access to United's global network at its Los Angeles hub.

City

Depart

Arrive

Frequency

Aircraft

Los Angeles-Stockton

 1:00 p.m.

5:10 p.m.

2:22 p.m.

6:32 p.m.

Daily, year-round

CRJ-200 

Stockton-Los Angeles

 7:41 a.m.

3:00 p.m.

9:10 a.m. 

4:29 p.m.

Daily, year-round

 CRJ-200

Washington Dulles to Traverse City, Michigan

Located on the eastern shores of Lake Michigan, picturesque Traverse City is an ideal destination for a summer vacation. In fact, fans of the National Cherry Blossom Festival in Washington can follow up with a trip to Traverse City, home of the annual week-long National Cherry Festival in July. United customers traveling between Washington, D.C. and Traverse City will enjoy the area's freshwater beaches, vineyards and nearby national forest and state park.

City

Depart

Arrive

Frequency

Aircraft


Washington Dulles-Traverse City

 9:00 a.m.

11:00 a.m.

Saturday

EMB-145


Traverse City-Washington Dulles

 1:45 pm

3:45 pm

Saturday

EMB-145


Booking summer travel is an opportunity for United MileagePlus members to enjoy the benefits and perks of their membership. Whether it's a trip for business or a vacation getaway with friends or family, MileagePlus Premier and eligible United MileagePlus Chase cardmembers can book Everyday Awards on flights operated by United and United Express.

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."

 

SOURCE United Airlines

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

United Airlines Names Pam Hendry Treasurer

December 17, 2018

CHICAGO, Dec. 17, 2018 /PRNewswire/ -- United Airlines (UAL) today announced Pam Hendry has been named vice president and treasurer. Hendry will be responsible for Corporate Finance, Treasury Operations and Risk Management.

Hendry is a senior aviation finance executive who has an extensive background in cost-effectively financing aircraft. She spent the majority of her career at International Lease Finance Corporation (ILFC) where, among other roles, she served as senior vice president and treasurer.

"Pam is well known and respected throughout the aircraft finance community. With her reputation as a strong leader and her deep industry knowledge she will be a great addition to the United team," said Executive Vice President and CFO Gerry Laderman. "I look forward to welcoming Pam to United and partnering with her and our entire team as we continue to deliver on the growth strategy we laid out in January of this year."

Prior to joining United, Hendry was a managing director at Plane View Partners, an aviation consulting firm. She has also held a number of leadership and consulting roles in aircraft finance and leasing, where she built a proven track record in financial and capital markets.

Hendry holds a bachelor's degree in Business Economics from the University of California, Santa Barbara.

Hendry will report to Laderman and will start on January 7.

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".

 

SOURCE United Airlines

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