United Airlines and Delta post heavy Q1 losses
Two of the big three US carriers, United Airlines and Delta Air Lines, posted heavy first-quarter losses on Wednesday. They were hit by the effects of the slowing US economy and labour disruption.
UAL, the parent company of United, reported a net loss of $313m, or $5.97 per share, in the first three months of the year, compared with a loss of $99m last year.
The losses were significantly worse than the consensus forecast on Wall Street, where analysts had expected a loss of $4.28 per share, according to Thomson Financial/First Call.
Delta, meanwhile, reported a loss of $133m, or $1.11 per share, compared with a profit of $216m in the same quarter last year.
United, which was displaced as the world’s largest carrier by rival American Airlines following its acquisition of TWA, warned that it expected the trend in declining unit revenues to worsen in the second quarter. The carrier’s unit revenues or yields declined by 3 per cent in the first three months. It said it expected to post a loss for the full year.
Delta was equally downbeat about the outlook. It estimated that the economic downturn and the possible threat of a strike by its pilots in the second quarter could hit revenues by between $300m to $350m.
