United Airlines Talks About the Weather

United Airlines says winter storms wiped out 22,500 flights in January and February and hurt its first-quarter revenue.

That's nearly four times the number of flights that United canceled in the first two months last year. About 20,000 of the scrubbed flights occurred on United Express regional flights, which use smaller jets.

Some analysts revised their estimates to forecast a wider loss for the quarter at the Chicago-based airline.

Shares of United Continental Holdings were down $1.01, or 2%, to $45.50 in afternoon trading Friday. They plunged to $44.88, a drop of 3.5%, earlier in the session before recovering some ground.

U.S. airlines have canceled more than 80,000 flights since December, the most of any winter season since the government started keeping track more than 20 years ago. United has hub airports in Chicago, Denver and Newark, N.J., that have been particularly hard hit by winter storms.

United said that about 13% of its Express regional flights have been canceled so far in 2014, which it called an "extraordinary" level. Because of the lost flights, the airline now expects revenue for every seat flown one mile -- a closely watched number in the airline business -- will decline between a half-point and 2.5% from the first quarter of 2013. United had been predicting the figure would be flat to up 2%. The airline added that March results would be hurt by the shift of Easter back to April.

The airline didn't give a dollar figure on lost revenue, but its disclosure after the market closed on Thursday was the most detailed yet from any of the four major airlines.

Cowen and Co. analyst Helane Becker said the disclosure prompted her to predict United would post a first-quarter loss of $1.20 per share from her earlier forecast of a loss of $0.65 per share. JPMorgan analyst Jamie Baker said the United comments suggest a loss of about $1.10 per share, and it could go higher. Analysts surveyed by FactSet had predicted that United would lose $0.61 per share.

Baker said that he expected the weather-related impact would be less severe at American Airlines Group and Delta Air Lines. American declined to comment, and Delta did not immediately respond to a request for comment.

JetBlue Airways Corp. has said that January storms in the Northeast cost it $45 million in revenue and $30 million in operating income. That airline, with big operations in New York and Boston, hasn't updated those numbers for February.

link


Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2859611, ~/Articles/ArticleHandler.aspx, 8/29/2014 6:36:46 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement