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United Air parent reports first profit since 2000

UAL Corp. , the parent of United Airlines, on Monday posted a second-quarter profit, its first since 2000, helped by strong revenue and cost cuts.
/ Source: The Associated Press

UAL Corp., parent of United Airlines, reaffirmed Monday that it had its first profit in six years in the second quarter on 16 percent revenue growth.

Making formal the results it announced in preliminary form a week ago, the company posted net income of $119 million, or 93 cents per share, for the April-June period compared with a loss of $1.43 billion, or $12.33 per share, in the year-ago period, when the company was operating under Chapter 11 bankruptcy protection.

Revenue grew to $5.11 billion from $4.42 billion a year ago.

It was the first quarter in the black for the Elk Grove Village, Ill.-based company since it earned $408 million in the second quarter of 2000.

The nation’s No. 2 carrier officially reported a $22.9 billion on-paper gain for the first quarter but that reflected a formal settling of accounts from bankruptcy and was not a true profit. Excluding those reorganization items, it posted a loss of $306 million before reorganization items for that period.

Chairman and CEO Glenn Tilton said the second-quarter results testify to the progress the company has made in its agenda to reduce costs, optimize revenue and improve the customer experience.

“We posted earnings that beat analyst expectations, the result of strong revenue growth in a healthy revenue environment, improved cost performance and a strong cash position,” he said in a message to employees.

Total operating expenses increased 11 percent to $4.85 billion, including a 31 percent increase in fuel costs. Major airlines have been reporting improved results this quarter, as cost control efforts, higher fares and reduced capacity have combined to offset the rising fuel prices.

UAL emerged from bankruptcy in February.