United Airlines parent UAL Corp. lost $152 million in the first quarter, or $1.32 a share, the company announced today.
With increased competition from Southwest Airlines and Frontier Airlines at Denver International Airport, United’s revenue performance has suffered in Denver, the carrier acknowledged during a conference call this morning.
“Denver was uniquely punished on a year-over-year basis,” said John Tague, United’s chief revenue officer. “Clearly we’re under pressure in Denver and we expect that to continue.”
It could mean United will reduce flights in Denver, as the airline plans to reduce domestic capacity. In the domestic market, “We have too much capacity,” Tague said.
United’s loss was worse than analyst expectations. Revenues were about $4.4 billion, down 2.1 percent, or $92 million, from the first quarter of 2006. United attributed the decline in part to a change in how it accounts for frequent flier program revenue. Expenses came to about $4.5 billion, down from $4.6 billion a year ago.
In the year-ago quarter, the company technically had $22.6 million in net income, but that included $22.9 million in reorganization items. UAL exited from Chapter 11 bankruptcy in the first quarter of 2006. The company said its $236 million pre-tax loss was a $70 million improvement compared with a year earlier, excluding reorganization items.
United’s loss comes as other carriers have reported profits. American Airlines had an $81 million profit in the first quarter, or 30 cents per diluted share. Continental Airlines had $22 million in profit in the quarter, or 21 cents per diluted share.
Staff writer Kelly Yamanouchi can be reached at 303-954-1488 or at kyamanouchi@denverpost.com ..
