By DAVE CARPENTER
The Associated Press
Tuesday, October 31, 2006; 10:27 AM
CHICAGO -- United Airlines parent UAL Corp. reported third-quarter earnings Tuesday of $190 million, marking the first time it has posted back-to-back profits in more than six years.
Higher fares and lower costs as the result of its three-year bankruptcy restructuring helped keep the nation's No. 2 carrier modestly profitable despite still-lofty fuel costs.
The company's earnings of $119 million in the second quarter was its first true profit since 2000.
Net earnings for the three months ended Sept. 30 amounted to $1.30 per share, compared with a loss of $1.77 billion, or $15.26 per share, a year ago when the company was nearing the end of its three-year bankruptcy restructuring.
Revenue for the third quarter was $5.2 billion, up 11 percent from $4.7 billion a year ago.
Analysts surveyed by Thomson Financial had forecast quarterly earnings of $1.43 per share on revenue of $5.2 billion.
The Elk Grove Village, Ill.-based company said $60 million in income tax expense in the quarter reduced earnings by 43 cents a share.
Its shares fell 54 cents, or 1.5 percent, to $36.23 in morning trading on the Nasdaq Stock Market.
But J.P. Morgan analyst Jamie Baker said United's results were better than expected, citing its "significant revenue momentum."
Operating profit was $335 million, up from $170 million a year earlier.
Like other U.S. airlines, United's bottom line benefited from increased fares despite the cost of fuel, which remains high by historic standards despite a recent decline. It said continuing revenue and productivity improvements more than offset a $293 million increase in fuel expenses during the quarter.
Chairman and CEO Glenn Tilton called the quarter "solid" and said United's revenue increase compared favorably to those of its industry peers.
He told employees in a recorded message that the results "demonstrate momentum on our core agenda of continuous improvement, controlling our costs, optimizing our revenue and improving our customer experience."
United lost billions of dollars from 2000 until earlier this year. The carrier officially reported a $22.9 billion on-paper gain for the first quarter of 2006, but that reflected a formal settling of accounts from bankruptcy and was not a true profit. Excluding those reorganization items, it lost $306 million in that period.
Year-to-date earnings results for 2006 and 2005 are not directly comparable because of its emergence from bankruptcy on Feb. 1. For the eight months after that, UAL said it had a profit of $86 million; a year earlier, it lost $4.3 billion for the full nine-month period.
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