Monday, March 30th10.8°C
25326
25173

United Airlines can't bring in enough revenue to cover its costs; still struggling with merger

United Airlines is the one U.S. carrier that can't seem to get its act together.

While all the other major airlines made money in the first quarter, United lost $609 million during the first three months of this year.

United attributed $200 million of its loss to the "historic severe" winter weather that impacted much of the U.S. this past winter. But by comparison, Delta Air Lines made $213 million in the same quarter while dealing with the same ice and snow storms.

Chicago-based United is still struggling to combine systems and see financial benefits following its 2010 merger with Continental Airlines. In the first quarter, its cost for each mile passengers flew rose 1 per cent but its related revenue fell 2 per cent. It simply isn't able to charge high enough airfares.

United lost $1.66 per share, worse than the $1.26 per share it lost during the same period last year. Excluding special items, the loss was $1.33 per share, barely beating the $1.35 loss expected by Wall Street analysts surveyed by FactSet.

United's revenue slipped 0.3 per cent to $8.7 billion, just short of the $8.71 billion Wall Street analysts had expected.

The one bright spot for United was that it paid less for fuel: $3.18 a gallon, down from $3.28 during last year's first quarter. Considering that the airline used 916 million gallons during the period, that added up to $133 million in savings.

"While we are not pleased with our first-quarter financial results, we are building a strong foundation that will result in improved financial performance," John Rainey, chief financial officer for United Continental Holdings, Inc., said in a statement.

United also lost $21 million during the quarter due to an exchange rate loss in Venezuela. Approximately $100 million of the company's unrestricted cash balance was held as Venezuelan bolivars as of March 31, 2014. All international airlines flying there have struggled with a quickly devaluing currency and have billions of dollars tied up in bolivars that can't be quickly converted because of Venezuelan currency controls.

__

Scott Mayerowitz can be reached at http://twitter.com/GlobeTrotScott.

The Canadian Press


Read more Business News

25608


Recent Trending




Today's Market
S&P TSX14962.56+150.14
S&P CDNX679.93-1.50
DJIA17997.27+284.61
Nasdaq4946.00+54.78
S&P 5002087.31+26.29
CDN Dollar0.7882-0.0048
Gold1184.10-15.70
Oil48.33-0.54
Lumber279.40-3.20
Natural Gas2.62-0.05

 
Okanagan Companies
Pacific Safety0.115-0.010
Knighthawk0.010.00
QHR Technologies Inc1.50+0.00
Cantex0.03-0.01
Anavex Life Sciences0.215-0.004
Metalex Ventures0.04-0.01
Russel Metals24.52+0.02
Copper Mountain Mining1.16+0.03
Colorado Resources0.12-0.01
ReliaBrand Inc0.006-0.001
Sunrise Resources Ltd0.045+0.000
Mission Ready Services0.255+0.020
Decisive Dividend Corporation1.80+0.02

 





FEATURED Property
22303985 - 670 Lequime
2 bedrooms 3 baths
$624,900
more details
image2image2image2
Click here to feature your property
Please wait... loading


Down payment

If you have less than 20% down payment, mortgage insurance is required through Canada Mortgage & Housing (CMHC), Genworth or Canada Guaranty. Homeowners no longer need the minimum 5% down payment ...


CRA Notice of Assessment

Many Canadians rush to file their taxes on time each year and don’t think about it until the next year. One of the most overlooked notices received from the CRA annually is the annual Notice of ...


Medical confidential?

If ICBC asks your doctor for your information you may wonder: Can ICBC ask my doctor for my medical information? Can ICBC request a medical report from my doctor without my consent? What is ICBC entit...

_








Member of BC Press Council


24598