=20 ---------------------------------------------------------------------- This article was sent to you by someone who found it on SFGate. The original article can be found on SFGate.com here: http://www.sfgate.com/cgi-bin/article.cgi?file=3D/news/archive/2004/04/29/f= inancial1541EDT0244.DTL --------------------------------------------------------------------- Thursday, April 29, 2004 (AP) United parent reports $459 million loss, bankruptcy progress DAVE CARPENTER, AP Business Writer (04-29) 14:38 PDT CHICAGO (AP) -- United Airlines' parent company posted a net loss of $459 million for the first quarter -- sharply improved from a year ago but reflecting continuing challenges as it targets emergence from Chapter 11 bankruptcy later this year. UAL Corp. said in reporting quarterly results Thursday that passenger un= it revenue rose 14 percent from a year earlier, mainline operating costs dropped 11 percent and the company continues to meet its bankruptcy lenders' financial requirements monthly. But soaring jet fuel prices cost it $80 million to $100 million more than anticipated, and United also is still awaiting word after 41/2 months on its application for a $1.6 billion federal loan guarantee. Standard and Poor's analyst Philip Baggaley said lower labor costs helped United show a bigger net improvement than most other large U.S. carriers. But he noted that its operating margin for the quarter was worse than all but Delta Air Lines and US Airways. "While much better, UAL's results remain poor in absolute terms, as do those of its peer large U.S. airlines," Baggaley said in a research note. "Worse-than-expected airline industry conditions, including high fuel prices and continued intense price competition from low-cost airlines, have forced UAL to lower its expectations for operating results in 2004." The net loss amounted to $4.17 per share, compared with a loss a year earlier of $1.34 billion, or $14.16 per share. Excluding restructuring items, the loss was $316 million, or $2.89 per share. That's slightly better than some Wall Street analysts expected, although most stopped following the company actively after United said it would cancel its stock before it leaves bankruptcy. Revenues were $3.7 billion, up 17 percent from $3.18 billion in the first quarter of 2003. "We are doing exactly what we said we would do to be able to succeed in the new revenue environment -- maintaining a relentless focus on reducing costs and improving efficiency," chairman and CEO Glenn Tilton said. "But there is still a lot of work ahead of us. Like the rest of the industry, we are impacted by fuel prices." Chief financial officer Jake Brace called the quarter a period of significant improvement, including strong early results for the company's new discount carrier, Ted. But he noted that the continuing rise in jet fuel means the company's previous estimate of having to pay $450 million more than initially estimated for jet fuel in 2004 already will be exceeded. "Fuel prices are definitely challenging the industry, and us in particular," he said in a telephone interview. Earlier this week, United announced it would be the first U.S. commercial carrier to provide service to Vietnam, starting daily service between San Francisco and Ho Chi Minh City via Hong Kong as soon as it receives final approval from Vietnamese and U.S. government regulators. UAL shares rose 8 cents Thursday to close at $1.38 on the OTC Bulletin Board. On the Net: www.united.com ---------------------------------------------------------------------- Copyright 2004 AP