United Airlines Holdings, Inc. · NASDAQ:UAL
United Airlines — United Continental Holdings — Q2 2017 Earnings Presentation
24 slides from United Airlines's earnings presentation, Jul 19, 2017
Slide 1: 2Q 2017 Earnings Call
2Q 2017 Earnings Call July 19, 2017 Exhibit 99.1
Slide 2: Safe Harbor Statement
Safe Harbor Statement Certain statements included in this presentation are forward-looking and thus reflect our current expectations and beliefs with respect to certain current and future events and anticipated financial and operating performance. Such forward-looking statements are and will be subj
Slide 3: Oscar Munoz Opening Remarks
Oscar Munoz Opening Remarks Chief Executive Officer
Slide 4: Second quarter highlights: EPS and pre-tax margin
EPS including special charges increased 49.4%; 5.4% excluding special charges Achieved pre-tax margin of 12.7%; 13.2% excluding special charges #1 among our largest competitors in completion, on-time departures and on-time arrivals Redoubled focus on customer centricity – involuntary denied boarding
Slide 5: Scott Kirby Operations and Revenue Update
Scott Kirby President Operations and Revenue Update
Slide 6: Best second quarter airline operation among major competitors
Best second quarter airline operation among major competitors Completion factor1 D:001 1 Mainline (all domestic and international flights) 2 As reported to the Department of Transportation; reflects April and May only 81.1% A:141 Mishandled bag ratio2
Slide 7: Geographic region overview
Geographic region overview Domestic Consolidated Latin Pacific Atlantic 1 Based on capacity from 3Q16-2Q17 2 PRASM as compared to 3Q16 % ASMs1 2Q17 YOY PRASM H/(L) Notes 3Q17 outlook2 55% 2.4% Met expectations Roughly flat 18% 3.3% Strong US point-of-sale & front cabin demand Roughly flat 17% (5.5%)
Slide 8: 2017 consolidated capacity is still expected to grow 2.5% to 3.5%
2017 consolidated capacity is still expected to grow 2.5% to 3.5% ~4.0% 1.0% - 2.0% 5.5% - 6.5% 3Q17 capacity outlook Year-over-year H/(L) FY17 capacity outlook Year-over-year H/(L) 2.5% - 3.5% 1.0% - 2.0% 3.5% - 4.5%
Slide 9: Operational reliability continues to set company records
Operational reliability continues to set company records Basic Economy rolled out to all mainland U.S. domestic markets; we are pleased with the results New summer capacity growth is efficient and performing well Rebanking begins in the fall in IAH, with ORD and DEN following in 2018 Phase I of reve
Slide 10: Andrew Levy Financial Update
Andrew Levy Financial Update Executive Vice President and Chief Financial Officer
Slide 11: 2Q17 GAAP earnings per share, diluted of $2.66
2Q17 GAAP earnings per share, diluted of $2.66 $B 2Q17 2Q16 H/(L)2 Total revenue $10.0 $9.4 6.4% Fuel expense $1.7 $1.4 16.1% Non-fuel expense1 $7.0 $7.1 NM Pre-tax earnings $1.3 $0.9 36.8% Net income $0.8 $0.6 39.1% Earnings per share, diluted $2.66 $1.78 49.4% Weighted average shares, diluted 308
Slide 12: 2Q17 non-GAAP earnings per share, diluted of $2.75
2Q17 non-GAAP earnings per share, diluted of $2.75 $B 2Q17 2Q16 H/(L)3 Total revenue $10.0 $9.4 6.4% Fuel expense $1.7 $1.4 16.1% Non-fuel expense1,2 $7.0 $6.6 6.4% Pre-tax earnings2 $1.3 $1.4 (3.0%) Net income2 $0.8 $0.9 (2.0%) Earnings per share, diluted2 $2.75 $2.61 5.4% Weighted average shares,
Slide 13: Total CASM was down 1.0% in the second quarter
Total CASM was down 1.0% in the second quarter Total CASM Year-over-year H/(L) 1 While the Company anticipates that it will record special charges throughout the year, at this time the Company is unable to provide an estimate of these charges, as well as an estimate of full-year profit sharing, with
Slide 14: Pace of non-fuel unit cost growth expected to slow in second half
Pace of non-fuel unit cost growth expected to slow in the second half of 2017 2.5% - 3.5% 2.0% - 3.0% Non-fuel CASM1,2 Year-over-year H/(L) 1 While the Company anticipates that it will record special charges throughout the year, at this time the Company is unable to provide an estimate of these char
Slide 15: Balance sheet and capital allocation update
Balance sheet and capital allocation update Ended with $6.6B liquidity, increased by $0.2B during the quarter Pension Shareholder Returns 2Q buybacks of $422M ($74/share on average) Funded $160M in 2Q $240M contributed year-to-date Target to fund $400M in 2017 Repurchased 6% of shares outstanding ov
Slide 16: Increasing 2017 capex guidance to $4.6B - $4.8B
Increasing 2017 capex guidance to $4.6B - $4.8B Expect capex to decrease ~$1B in 2018 versus 2017’s elevated level 1 Net change on pre-delivery payments based on change to future delivery schedule
Slide 17: Guidance Summary
Guidance Summary 3Q17 FY17 Capacity ~4.0% 2.5% - 3.5% PRASM (1.0%) – 1.0% CASM ex1,2 2.0% - 3.0% 2.5% - 3.5% Fuel price3 $1.56 - $1.61 Pre-tax margin1 12.5% - 14.5% Capex4 $1.15B - $1.25B $4.6B - $4.8B 1 Excludes special charges, the nature and amount of which are not determinable at this time 2 Exc
Slide 18: Oscar Munoz Closing Remarks
Oscar Munoz Closing Remarks Chief Executive Officer
Slide 19: Question & Answer Session
Question & Answer Session UNITED
Slide 20: UNITED
UNITED UNITED 5).
Slide 21: Appendix A: reconciliation of GAAP to Non-GAAP financial measures
Appendix A: reconciliation of GAAP to Non-GAAP financial measures UAL evaluates its financial performance utilizing various accounting principles generally accepted in the United States of America (GAAP) and Non-GAAP financial measures, including income (loss) before taxes excluding special charges,
Slide 22: Appendix A: reconciliation of GAAP to Non-GAAP financial measures (continued)
Appendix A: reconciliation of GAAP to Non-GAAP financial measures (continued) UAL also presented non-fuel expense excluding special charges. UAL believes that adjusting for special charges is useful to investors because special charges are non-recurring charges not indicative of UAL’s ongoing perfor
Slide 23: Appendix A: reconciliation of GAAP to Non-GAAP financial measures (continued)
Appendix A: reconciliation of GAAP to Non-GAAP financial measures (continued) CASM is a common metric used in the airline industry to measure an airline’s cost structure and efficiency. UAL reports CASM excluding profit sharing, third-party business expenses, fuel, and special charges. UAL believes
Slide 24: Appendix A: reconciliation of GAAP to Non-GAAP financial measures (continued)
Appendix A: reconciliation of GAAP to Non-GAAP financial measures (continued) CASM is a common metric used in the airline industry to measure an airline’s cost structure and efficiency. UAL reports CASM excluding special charges, third-party business expenses, fuel and profit sharing. UAL believes t
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