United Q1 Net Income Down 70 Percent

United Airlines reported net income for the first quarter of USD$96 million and said it needs to do a better job serving its customers.

Net income was down 69.3 percent from 1Q16’s $313 million as fuel costs jumped 28.1 per cent to $1.56 billion. Operating revenue rose 2.7 percent to $8.42 billion, but costs were up 7.9 percent at $8.14 billion.

United carried 33.1 million passengers during the quarter to end March, a 3.2 percent increase, with RPM (revenue passenger miles) traffic up 2.2 percent. ASM (available seat miles) capacity was up 2.6 percent, with a resulting load factor 0.3 percentage points down at 79.6 percent.

Mainline showed positive growth with RPM traffic up 3.2 percent on an ASM capacity increase of 3.7 percent. Regional, however, reduced ASM capacity by 5 percent and saw an RPM traffic drop of 5.2 percent.

Consolidated unit cost per available seat mile (CASM) increased 5.1 percent as a result of higher fuel and staff costs.

On the UA3411 incident, where the flight was overbooked and a passenger forcibly removed from the aircraft, United chief executive Oscar Munoz said “The incident that took place aboard flight 3411 has been a humbling experience, and I take full responsibility.

“This will prove to be a watershed moment for our company, and we are more determined than ever to put our customers at the centre of everything we do. We are dedicated to setting the standard for customer service among US airlines, as we elevate the experience our customers have with us from booking to baggage claim.”