Oct. 19, 2021 /PRNewswire/ -- United Airlines (UAL) today announced third-quarter 2021 financial results. Despite the impact of the COVID-19 Delta variant in the third quarter, the company remains confidently on track to achieve the range of longer term financial targets laid out as part of its United Next plan earlier this summer, and to reduce CASM-ex1 below 2019 levels next year.
Citing the rebound in premium leisure travel, re-opening of European borders next month, continued recovery of business travel and early indications of loosening travel restrictions in key Pacific markets, United also announced plans to increase international capacity by 10% in 2022 - while keeping domestic capacity flat to 2019. The plan will capitalize on already improving international margins and United's ideally situated coastal hubs that have powered the airline's recent success in launching new routes to Africa and India. Expected flying at record levels to Europe, Latin America, India, Africa and the Middle East in summer 2022, will be enabled by the anticipated return of United's Pratt & Whitney-powered Boeing 777s to the fleet in 2022, which - when combined with already announced approximately $2.2 billion in structural cost reduction and planned gauge growth - will allow United to keep CASM-ex1 in check as it continues on the path to recovery.
"The recovery was delayed by the Delta variant, but the United team remains focused on our long-term vision – and not getting sidetracked by near-term volatility – meaning we're solidly on track to achieve the targets we set for 2022," said United Airlines CEO Scott Kirby. "From the return of business travel and the planned re-opening of Europe and early indications for opening in the Pacific, the headwinds we've faced are turning to tailwinds, and we believe that United is better positioned to lead the recovery than any airline in the world. Our recovery will be supported by investments in technology and other efficiencies that will give our employees the tools they need to take great care of our customers - and keep costs under control. I am grateful to our United team members for their continued commitment to our customers, because it has been essential to our ability to weather the pandemic, and it will fuel our success in the years ahead."
Third Quarter Financial Results
Reported third quarter 2021 capacity down 28% compared to third quarter 2019. Reported third quarter 2021 net income of $0.5 billion, adjusted net loss[2] of $0.3 billion. Reported third quarter 2021 total operating revenue of $7.8 billion, down 31.9% compared to third quarter 2019. Reported third quarter 2021 Total Revenue Per Available Seat Mile (TRASM) of down 5.1% compared to third quarter 2019. Reported third quarter 2021 operating expenses down 32.2%, down 20.9% excluding special charges (credits)2, compared to third quarter 2019. Reported third quarter 2021 Cost Per Available Seat Mile (CASM) of down 5.6%, CASM, excluding fuel, profit sharing, third-party business expenses and special charges (CASM-ex)1 of up 14.9% compared to third quarter 2019. Reported third quarter 2021 pre-tax margin of 7.8%, negative 6.1% on an adjusted2 basis. Reported third quarter 2021 adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) margin2 of 7.4%. Reported third quarter 2021 ending available liquidity3 of approximately $21 billion. GUIDANCE
Expects fourth quarter 2021 capacity to be down approximately 23% versus fourth quarter 2019.5 Expects fourth quarter 2021 total revenue to be down 25% to 30% versus the fourth quarter 2019. Expects fourth quarter 2021 CASM-ex1 to be up 12% to 14% compared to fourth quarter 2019. Estimates fourth quarter 2021 fuel price of approximately $2.39 per gallon.6 Continues to expect 2022 CASM-ex1 to be lower than 2019. Expects 2022 capacity to be up approximately 5% versus 2019 driven by international growth. Expects adjusted capital expenditures2 to be around $3 billion in full year 2021. Expects adjusted diluted earnings per share2 in 2026 of around $20 assuming the same number of diluted shares outstanding as of September 30, 2021. United Next assumes 2026 TRASM remains down around 1% versus 2019. Remains on track to achieve long term financial targets from United Next plan.7"
C
Just look at the options being purchased. The quantity of Calls over Puts for Sept 17th is ~50:1. Hedgies are tanking the price to get a bargain on these call options while they have the retail investors bring the price back to an adequate 55-60 by mid-august. Opening international travel, a nice earnings report next week, a rotation from overpriced tech into value/recovery, Delta variant hype dying down. This is a spring loaded stock just waiting to break 60.
Investors will rotate into airlines again, have patience. Major bullish catalysts are coming in July.. -Data is showing July 4th weekend will break post-pandemic TSA travel numbers by a decent margin. - United States will loosen international travel restrictions in July or early August. - Highly anticipated airlines earnings mid July. - Transatlantic routes will most likely open end of July as UK reopens - July on average is the busiest travel month of the year. - Increase in oil prices are being countered by higher demand for tickets and ticket prices.
$DAL $AAL $UAL $SAVE $JETS $JBLU $ALK $LUV
J
This is about DAL but is similar for all airlines IMO.
"Morgan Stanley analyst Ravi Shanker noted that Delta reported Q2 results better than the company's initial guidance and that is Q3 outlook compares well to the firm's and consensus estimates. The analyst, who believes Delta "delivered the numbers and the tone of commentary needed for investors to keep the faith in the reopening narrative," thinks it "makes zero sense" that the stock price is basically where it was back in December when the vaccine news had just hit. With greater visibility on navigating the latest variant, which should become clear one way or the other by Labor Day, Shanker argues that Delta shares deserve to be trading "significantly higher than current levels." The analyst keeps an Overweight rating and $73 price target on Delta."
S
this is still $40 under 52 week high. Airlines and recreation will boom once the vaccines are out and Covid ends. Easy and safe money right here.
W
If they can afford it, upgrading to newer jets and adding more lines of travel and cargo will be a boom for United. "United Airlines (UAL) is reportedly in talks to buy up to 150 Boeing (BA) 737 Max jets as travel ramps up. Boeing stock climbed."
W
Yesterday and today show one thing. Emotions dictate a lot how the reopening stocks will go. One death from Omicron sent us down the drain (after 2 days of consecutive losses), and the news of the Pfizer pill was not good enough to set a rebound. Now we’ll see what happens with the Fed decisions, and everyone is pretty nervous about that too.
My conclusion reaffirms my theory expressed yesterday, which is that this industry will rebound but it won’t be overnight. Too many scarred investors are staying on the fence. I have not sold a share during these tumultuous days. If anything I’ve used some small cash to buy a few shares here and there. Hopefully Omicron will out infect delta, and the impacts of Covid will quickly taper off…. This combined with new treatments.
Good luck to all and hang in there. We may be losing the battle, but we are going to win the war
b
We are about to overcome the covid and begin the rise in tourism to 200%. The next target price must be in the range of $53-54 to then reach $60.
J
Should I but UAL. I only have a portfolio value of $400 and I am 14. I just sold it today and made $2 profit because I had $100 in it but should I buy it again?
J
As I said before, UAL is the only lagging airline in stock price compared to pre-pandemic. The late rotation comers can just see it in the chart, reason is no need. They looked at the chart and see it come down from almnost $90 to now $50. So they see a near double. All other airlines (except AAL) are near pre-pandemic level and United was the top dog at the time. Nothing has changed since... This is going to $60 shortly then a gradual move to $80 by summer.
J
Good news for United Airlines. Thanks to the new CEO, Scott Kirby for thinking of Investors, employees and customers! ❤️
The travel demand is very high right now, and it will continue all the way until end of next year, the only thing that pull back all airlines stock is just the fuel price - it's more like an excuse for the analyst to cast a gloomy future for airlines stock, airlines company will hedge fuel price for sure, they are not first day in business. Besides, fuel price is something that government can interfere, this is not pandemic, OPEC has to do something about it. $AAL $UAL $DAL are all in bargain price now, buy at this price and just hold on to it, and you will have handsome return next year.
J
I was a short on growth stocks in the past month. But starting this moment, I will be a dip buyer for airline stocks until UAL reaches $75.
W
Finally steadily and tangibly up! So glad I kept putting money into UAL at multiple points when it dipped…. Now I’m enjoying the show
N
UAL....... $60 in January, $70 in February, $80 in March, $90 in April, $120 December 2021 make your travel plans now because it might be difficult to find a seat on a plane by this time next year
T
UAL will start delivering Pfizer and Biotech vaccine on chartered flights approved today.
W
United Airlines Holdings Inc. said Monday that it is adding more than 400 daily flights to its July schedule and will increase its service to destinations in Europe, as booking for summer travel had more than tripled (up 214%) compared with 2020 levels. The air carrier said its July schedule in the U.S. will reach 80% of July 2019 levels, making it the largest monthly schedule since before the COVID-19 pandemic. "This July we're taking a big step toward flying at pre-pandemic levels for our domestic network," said Ankit Gupta, vice president of domestic network planning and scheduling. "By adjusting our bank structures at two key hub airports, we're able to offer our customers easy connections to destinations across the U.S. so they can start their vacations at times convenient for them." United's stock, which slipped 0.4% in premarket trading Monday, has run up 20.0% over the past three months through Friday, while the U.S. Global Jets ETF has gained 7.9% and the S&P 500 has tacked on 6.2%.
O
TSA passengers growing about 2% a week that means 8% a month knowing that we need about 30% to reach the full recovery if we do the math in about 4 months airlines would be fully recovered and might go beyond the pre-pandemic level as demande is huge which lead to an increase in tickets prices therefor a huge revenue growth.
A
American provided a fresh boost of confidence on Thursday, saying this July it will fly more than 55% of its domestic capacity from a year ago. That's up from 20% of its schedule in May and 25% in June. International travel is also slowly returning, with American planning to fly about 20% of its July 2019 international schedule next month.
We're still in recovery mode. On peak days American will fly 4,000 flights in July, compared to 6,800 daily flights prior to the COVID-19 crisis. But the July totals are double the airline's daily average for May. American carried about 110,000 passengers per day in the last week of May, up 71% from 32,000 average daily passengers in April.
"We're seeing a slow but steady rise in domestic demand. After a careful review of data, we've built a July schedule to match," American's senior vice president, Vasu Raja, said in a statement. "Our July schedule includes the smallest year-over-year capacity reduction since March. We'll continue to look for prudent opportunities to restore service so our customers can travel whenever and wherever they are ready."
Dr. Amesh Adalja, senior scholar at the Johns Hopkins University Center for Health Security, wrote in an email to CNN on Friday. "There will never be a time when there is a zero COVID threat as the virus transitions to endemicity," Adalja wrote. "Once the virus is tamed — by losing the ability to threaten hospital capacity through high levels of population immunity and treatments — I think public health recommendations will be more relaxed, though some people may voluntarily choose to continue to use them in high risk contexts." $UAL $LUV $DAL $JBLU
Citing the rebound in premium leisure travel, re-opening of European borders next month, continued recovery of business travel and early indications of loosening travel restrictions in key Pacific markets, United also announced plans to increase international capacity by 10% in 2022 - while keeping domestic capacity flat to 2019. The plan will capitalize on already improving international margins and United's ideally situated coastal hubs that have powered the airline's recent success in launching new routes to Africa and India. Expected flying at record levels to Europe, Latin America, India, Africa and the Middle East in summer 2022, will be enabled by the anticipated return of United's Pratt & Whitney-powered Boeing 777s to the fleet in 2022, which - when combined with already announced approximately $2.2 billion in structural cost reduction and planned gauge growth - will allow United to keep CASM-ex1 in check as it continues on the path to recovery.
"The recovery was delayed by the Delta variant, but the United team remains focused on our long-term vision – and not getting sidetracked by near-term volatility – meaning we're solidly on track to achieve the targets we set for 2022," said United Airlines CEO Scott Kirby. "From the return of business travel and the planned re-opening of Europe and early indications for opening in the Pacific, the headwinds we've faced are turning to tailwinds, and we believe that United is better positioned to lead the recovery than any airline in the world. Our recovery will be supported by investments in technology and other efficiencies that will give our employees the tools they need to take great care of our customers - and keep costs under control. I am grateful to our United team members for their continued commitment to our customers, because it has been essential to our ability to weather the pandemic, and it will fuel our success in the years ahead."
Third Quarter Financial Results
Reported third quarter 2021 capacity down 28% compared to third quarter 2019.
Reported third quarter 2021 net income of $0.5 billion, adjusted net loss[2] of $0.3 billion.
Reported third quarter 2021 total operating revenue of $7.8 billion, down 31.9% compared to third quarter 2019.
Reported third quarter 2021 Total Revenue Per Available Seat Mile (TRASM) of down 5.1% compared to third quarter 2019.
Reported third quarter 2021 operating expenses down 32.2%, down 20.9% excluding special charges (credits)2, compared to third quarter 2019.
Reported third quarter 2021 Cost Per Available Seat Mile (CASM) of down 5.6%, CASM, excluding fuel, profit sharing, third-party business expenses and special charges (CASM-ex)1 of up 14.9% compared to third quarter 2019.
Reported third quarter 2021 pre-tax margin of 7.8%, negative 6.1% on an adjusted2 basis.
Reported third quarter 2021 adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) margin2 of 7.4%.
Reported third quarter 2021 ending available liquidity3 of approximately $21 billion.
GUIDANCE
Expects fourth quarter 2021 capacity to be down approximately 23% versus fourth quarter 2019.5
Expects fourth quarter 2021 total revenue to be down 25% to 30% versus the fourth quarter 2019.
Expects fourth quarter 2021 CASM-ex1 to be up 12% to 14% compared to fourth quarter 2019.
Estimates fourth quarter 2021 fuel price of approximately $2.39 per gallon.6
Continues to expect 2022 CASM-ex1 to be lower than 2019.
Expects 2022 capacity to be up approximately 5% versus 2019 driven by international growth.
Expects adjusted capital expenditures2 to be around $3 billion in full year 2021.
Expects adjusted diluted earnings per share2 in 2026 of around $20 assuming the same number of diluted shares outstanding as of September 30, 2021. United Next assumes 2026 TRASM remains down around 1% versus 2019.
Remains on track to achieve long term financial targets from United Next plan.7"
-Data is showing July 4th weekend will break post-pandemic TSA travel numbers by a decent margin.
- United States will loosen international travel restrictions in July or early August.
- Highly anticipated airlines earnings mid July.
- Transatlantic routes will most likely open end of July as UK reopens
- July on average is the busiest travel month of the year.
- Increase in oil prices are being countered by higher demand for tickets and ticket prices.
$DAL $AAL $UAL $SAVE $JETS $JBLU $ALK $LUV
"Morgan Stanley analyst Ravi Shanker noted that Delta reported Q2 results better than the company's initial guidance and that is Q3 outlook compares well to the firm's and consensus estimates. The analyst, who believes Delta "delivered the numbers and the tone of commentary needed for investors to keep the faith in the reopening narrative," thinks it "makes zero sense" that the stock price is basically where it was back in December when the vaccine news had just hit. With greater visibility on navigating the latest variant, which should become clear one way or the other by Labor Day, Shanker argues that Delta shares deserve to be trading "significantly higher than current levels." The analyst keeps an Overweight rating and $73 price target on Delta."
One death from Omicron sent us down the drain (after 2 days of consecutive losses), and the news of the Pfizer pill was not good enough to set a rebound. Now we’ll see what happens with the Fed decisions, and everyone is pretty nervous about that too.
My conclusion reaffirms my theory expressed yesterday, which is that this industry will rebound but it won’t be overnight. Too many scarred investors are staying on the fence. I have not sold a share during these tumultuous days. If anything I’ve used some small cash to buy a few shares here and there. Hopefully Omicron will out infect delta, and the impacts of Covid will quickly taper off…. This combined with new treatments.
Good luck to all and hang in there. We may be losing the battle, but we are going to win the war
This is going to $60 shortly then a gradual move to $80 by summer.
https://www.google.com/amp/s/skift.com/2020/05/28/new-united-airlines-ceo-says-no-to-bankruptcy-and-mandating-blocked-middle-seats/amp/
We're still in recovery mode. On peak days American will fly 4,000 flights in July, compared to 6,800 daily flights prior to the COVID-19 crisis. But the July totals are double the airline's daily average for May. American carried about 110,000 passengers per day in the last week of May, up 71% from 32,000 average daily passengers in April.
"We're seeing a slow but steady rise in domestic demand. After a careful review of data, we've built a July schedule to match," American's senior vice president, Vasu Raja, said in a statement. "Our July schedule includes the smallest year-over-year capacity reduction since March. We'll continue to look for prudent opportunities to restore service so our customers can travel whenever and wherever they are ready."
"There will never be a time when there is a zero COVID threat as the virus transitions to endemicity," Adalja wrote. "Once the virus is tamed — by losing the ability to threaten hospital capacity through high levels of population immunity and treatments — I think public health recommendations will be more relaxed, though some people may voluntarily choose to continue to use them in high risk contexts." $UAL $LUV $DAL $JBLU