Between excessive fees, invasive security checkpoints, cramped seating, and expensive lousy food, the airline business is one of the most hated industries around. That is, of course, unless you are an investor in United Continental Holdings (UAL 0.06%) , in which case you're probably loving life.  The stock is trading at multi-year highs, and management wants you to know it's just getting started.

Project revenue

First, the good times aren't just a result of the favorable environment, but of company execution as well. CEO Jeffrey Smiesk stated:

Our second quarter financial performance reflects the progress we're making on initiatives we've been implementing over the last few quarters. Our revenue management and network improvements are delivering as expected. We're exhibiting excellent cost control. We're making disciplined aircraft investments that are improving our fuel efficiency, and we're continuing to strengthen our balance sheet.

Smiesk insists, despite management's pride, that United Continental Holdings still has a long way to go with its plan, which is working to not only grow revenue but accelerate it while getting the most bang for its buck from its current assets already in place.

Chief Revenue Officer James Compton added:

"We have a comprehensive effort under way to improve our revenue and margin performance. The initiative falls into 3 broad categories: network and scheduling, our regional operation and revenue management."

Project quality

The company is committed to cost reductions at the same time as revenue growth. United Continental Holdings nicknamed an initiative called "Project Quality," which is a goal of $2 billion in annual cost savings by 2017. All hands are on deck from the employees as they seek to "make meaningful gains in quality and efficiency."

One example of Project Quality being implemented is the company doing away more with the smaller, 50-seat regional aircraft that aren't cost efficient. At the beginning of the year 8% of flights were in this category, and United Continental Holdings is targeting just 5% by the end of 2015. In addition to fewer small aircraft flights, the company is working on consolidating its number of regional flying partners which, according to Compton, "will reduce complexity and variability, and thus drive improved reliability."

Project buyback

I'm always a big fan of large stock buybacks because they often send a message that is louder than words can be in terms of confidence. Smiesk stated:

"In what is perhaps the clearest demonstration of our confidence and our ability to achieve the goals of a long-term plan we laid out at our Investor Day last fall, we announced this morning $1 billion share repurchase program, which we expect to complete within the next 3 years."

The buyback has three effects.  First is the proof of confidence as mentioned by Smiesk.  Second is the physical buying of shares adds steady buying power to the open market, which in turn makes investors feel more comfortable.  Comfort equals the perception of less risk and a potentially higher trading multiple.  Finally, the actual buying back of shares reduces the share count and increases the earnings per share as the net income is spread among fewer pieces of the pie.  

Project stability

Buybacks are great, but sometimes there is a concern that a company is overspending on buybacks at the expense of a company's financial health. United Continental Holdings wants to assure you that is not the case here. According to CFO John Rainey:

"In addition to returning cash to our shareholders, our long-term capital structure goals include reducing our non-aircraft-related debt and managing total debt at approximately $15 billion, while maintaining an unrestricted liquidity balance of $5 billion to $6 billion."

He added that from debt paydowns interest expense is now 30% lower than it was just four years ago. Going forward, United Continental has $1.1 billion in debt payments due annually over the next four years which is roughly half what it was in the previous four years. Between its current liquidity balance, its credit facility, and its cash flow, this is expected to be a walk in the park to meet.

Foolish takeaway

There is an overall message that's clear from management: they plan to grow sales, grow profit margins, cut costs, and return value to shareholders all while paying down debt and reducing interest expense. All of this is expected to accelerate the bottom line. I won't necessarily vouch for management that it will all happen exactly as they plan over the long term, but the message they are trying to convey is clear: Their results are going to get a heck of a lot better.