United Continental Holdings (UCH) incurred a first-quarter net loss of $448 million, widened from a net deficit of $213 million in the prior-year period. It blamed the poor results on costs associated with the ongoing integration of United Airlines and Continental Airlines.
UCH president and CEO Jeff Smisek said the company took painful but necessary steps during the period to complete systems integration, hurting near-term results but paving the way for strong future earnings.
“We successfully completed the most complex aspects of integration” during the March period, Smisek told analysts and reporters Thursday. “We now market under a single code and can flow our aircraft freely to the right market … We are now on the steep back slope of our integration.”
Executive VP and chief revenue officer Jim Compton added, “Our revenue results were negatively impacted by the integration of our revenue management and booking systems, which included reducing our booking levels so we could better serve our customers during the reservations conversion.”
First-quarter revenue rose 4.9% year-over-year to $8.6 billion while expenses increased 8.6% to $8.87 billion, producing an operating loss of $271 million, reversed from an operating profit of $34 million in the 2011 March quarter.
Mainline passenger traffic decreased 0.2% to 41.19 billion RPMs on a 0.2% lift in capacity to 52.47 billion ASMs, producing a load factor of 78.5%, down 0.3 point. Yield improved 4.5% to 14.45 cents.
Article Source : ATW Daily News
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