By Jeremy Lemer in New York
United Continental Holdings, the parent company of the combined United Airlines and Continental Airlines, reported a fourth-quarter loss, as merger integration costs and other one-off costs wiped out gains from higher fares.
The biggest US carrier on Thursday said that in the three months to the end of December it lost $138m compared with a loss of $325m in the same period a year earlier. Excluding special items, the company reported net income of $109m, or about $0.30 cents per share.
Still, revenues were resilient, rising about 6 per cent to $8.9bn as the company benefited from full aircraft and higher ticket prices. Average fares rose to $269.82 from $242.95 in the quarter compared to the same period a year earlier.
Analysts had expected the company to report a profit of about $0.13 cents per share, excluding special items, on revenues of about $8.9bn. In pre-market trading United shares rose about 4 per cent to $21.22.
“We made significant progress in 2011 building the world’s leading airline, while running a clean, safe and reliable operation,” said Jeff Smisek, chief executive of United said, and the company noted that it continued to proceed apace with the merger integration.
In late 2010, United Airlines and Continental Airlines completed a $3.2bn all-stock merger creating the world’s largest carrier measured by revenues, and last year the companies reached an important milestone, receiving a single operating certificate from US regulators.
In recent weeks, airline analysts have become more optimistic on the outlook for US carriers, pointing to their willingness to cut flights and raise prices to offset fuel costs and sustain profitability.
On Wednesday, US Airways and Delta Air Lines enjoyed a notable share price bounce after the companies posted strong results indicating a mixture of careful capacity management and solid demand from both corporate and leisure travellers.
On Thursday, United indicated that it would also maintain tight control over capacity in the coming year in an effort to mitigate the impact of rising labour costs and high oil prices. In the fourth quarter, fuel costs rose $660m compared to the previous year.
? The Financial Times Limited 2012