United Airlines remains in £1.39 billion of loss in the fourth quarter

Written by: Wajeeh Khan
January 21, 2021
  • United Airlines remains in £1.39 billion of loss in the fourth quarter.
  • The Chicago-based air carrier's revenue slides to £2.49 billion.
  • United Airlines forecasts capacity to remain at least 51% down in Q1.

United Airlines Holdings Inc. (NASDAQ: UAL) said on Wednesday that it remained in loss in the fiscal fourth quarter after failing to return to profitability in the previous three quarters as well. The air carrier also said that its capacity was likely to be down by a minimum of 51% in fiscal Q1.

United Airlines slid more than 2.5% in after-hours trading on Wednesday. Including the price action, the stock that remained fairly volatile last year is now trading at £32 per share after recovering from a low of £14.54 per share in May 2020, when the COVID-19 crisis brought the demand for global air travel to a near halt.

United Airlines’ Q4 financial results versus analysts’ estimates

Are you looking for fast-news, hot-tips and market analysis? Sign-up for the Invezz newsletter, today.

United Airlines reported £1.39 billion of loss in the fourth quarter that translates to £4.66 per share. In the same quarter last year, the air carrier had earned £1.85 per share. At £2.49 billion, the Chicago-based company’s revenue slid in Q4 from a significantly higher £7.96 billion in the comparable quarter of last year.

According to FactSet, experts had forecast the company to post a marginally higher £2.50 billion of revenue in the recent quarter. Their estimate for per-share loss (GAAP) stood at £4.47. In the prior quarter (Q3), the airline had seen a 78% decline in third-quarter sales, as per the report published in October.

United Airlines’ guidance for the fiscal first quarter

For the fiscal first quarter, United Airlines now expects up to 70% decline in total operating revenue. A faster rollout of the COVID-19 vaccine, it added, could help with quicker recovery in the upcoming months. United Airlines said last week that it will resume Boeing 737 MAX flights with 12 routes in February.

The Coronavirus pandemic has so far infected more than 97 million people worldwide and caused over 2 million deaths. United Airlines, however, expressed confidence that it had slashed cash burn in recent months. The air carrier has boosted its liquidity by more than £18.98 billion since the start of the outbreak in 2020.

United Airlines is currently targeting structural reductions worth a minimum of £1.46 billion after identifying annual costs savings of £1.02 billion already. United Airlines performed largely downbeat in the stock market last year with an annual decline of close to 50%. At the time of writing, the U.S. air carrier is valued at £9.65 billion.