United Airlines revenues down with 87% year-on-year
United Airlines Holdings Inc. late Tuesday reported a billion-dollar quarterly loss, giving investors a look into financials thoroughly wrecked by the pandemic and the near standstill on air travel.
United said it lost $1.6 billion, or $5.79 a share, in the second quarter, contrasting with a profit of $1.05 billion, or $4.02 a share, in the year-ago quarter.
Adjusted for one-time items, United said it lost $2.6 billion, or $9.31 a share, versus an adjusted profit of $4.21 a share a year ago. Revenue fell 87% to $1.5 billion from $11.4 billion a year ago.
United reports its worst financial period since their foundation in 1926
Analysts polled by FactSet had expected the company to report an adjusted loss of $8.96 a share on sales of $1.3 billion.
The company called the quarter “the most difficult” financial period in its 94-year history. Liquidity as of Monday was about $15.2 billion, and the company said it expects liquidity at the end of the third quarter to be more than $18 billion.
Cash burn during the quarter averaged $40 million a day, including $3 million in principal payments and severance expenses, United said. It forecast its average daily cash burn to be about $25 million during the third quarter, including $6 million of principal repayments and severance expenses.
United Airlines CEO believes they survive when consumer demand returns
United said it believes that average to be the lowest among large air carriers as it did “the best job of matching actual capacity to demand among its largest network peers.”
“We accomplished this by quickly and accurately forecasting the impact that COVID would have on passenger and cargo demand, accurately matching our schedule to that reduced demand, completing the largest debt financing deal in aviation history, and cutting expenses across our business,” Chief Executive Scott Kirby said in a statement accompanying results.
“We believe this quick and aggressive action has positioned United to both survive the COVID crisis and capitalize on consumer demand when it sustainably returns.”