The parent of United Airlines posted a USD$448 million quarterly net loss, pressured by high fuel costs and expenses related to problems integrating some operations of merger partners United Airlines and Continental Airlines.
The results followed losses posted on Wednesday by Delta Air Lines and US Airways Group, which were hit by high fuel prices as well. The first-quarter is seasonally one of the weakest for airlines as travel demand slips in the winter.
It's the "slowest quarter, with mixed results for the industry. I'm looking for a strong second quarter," said Ray Neidl, an aerospace analyst at Maxim Group. "I think you'll see improvement in United in that period," Neidl said, noting that travel demand picks up in the summer.
The company said its first-quarter net loss amounted to USD$448 million, compared with a loss of USD$213 million a year earlier.
The company took charges related to the troublesome integration of United and Continental's inventory management systems in December and their passenger service systems in March.
In December, the inventory management system integration left unsold seats on some flights, resulting in lost revenue.
In March, United adopted the reservation system of Continental, triggering computer problems that caused flight delays, faulty kiosks and jammed phone lines.
"Our revenue results were negatively impacted by the integration of our revenue management and booking systems, which included reducing our booking levels so we could better serve our customers during the reservations conversion," said Jim Compton, the company's chief revenue officer, in a statement.
CEO Jeff Smisek said the integration of the systems, though problematic, would lead to make travel easier for customers.
Neidl said that with these unexpected integration problems resolved, the company would see more financial benefits from its 2010 merger.
The airline posted revenue of USD$8.6 billion, a gain of 4.9 percent. It paid USD$3.2 billion for fuel in the quarter, an increase of 21 percent from the same period a year ago. The company's unit costs came in lower than it had predicted in an outlook it issued on March 29.
United Continental finished the quarter with USD$7.8 billion in cash and short-term investments.