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2020-05-01

United Airlines posts a quarterly loss, up liquidity by US$ 9.6 billion

Image:-United airlines

United Airlines Holdings Inc (UAL.O) posted a first-quarter loss of $1.7 billion on Thursday, including charges against Latin American investments that have sown as the coronavirus pandemic jolts travel industries worldwide.

As demand has virtually disappeared due to the pandemic, airlines including United have parked jets and slashed flight schedules, forcing them to suspend growth plans and shift their focus to saving cash.

Chicago-based United said it had $9.6 billion in liquidity as of April 29, up from $7.2 billion at the end of March, and that its cash burn in the second quarter would range from $40 million to $45 million per day.

United is scheduled to receive $5 billion in payroll assistance under the Coronavirus Aid, Relief, and Economic Security (CARES) Act and will probably decide in the third quarter whether to tap a $4.5 billion loan under the same package.

Payroll aid terms bar airlines from cutting salaries or jobs through Sept. 30 but many, including United, have said that they will have to shrink in the fall if demand has not recovered.

"While we are still in the middle of this crisis, we're not going to hesitate to make difficult decisions that we believe will ensure our company's long-term success," CEO Oscar Munoz said in a statement.

The airline industry has said demand can take two to three years to reach levels in 2019.

United's net loss to March 31 is a year earlier compared to a profit of $292 million. Net loss for United on an adjusted net basis was $639 million, or a loss of $2.57 per share.

Operating total revenues declined to $8 billion by 17 percent.

United shares closed down at $29.58 by 5.2 per cent before the results were released.

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