United Airlines Holdings, Inc. · NASDAQ:UAL
United Airlines — United Continental Holdings — J.P. Morgan Aviation, Transportation and Industrials Conference 2018
15 slides from United Airlines's conference presentation, Mar 13, 2018
Slide 1: J.P. Morgan Aviation, Transportation and Industrials Conference
J.P. Morgan Aviation, Transportation and Industrials Conference March 13, 2018 Scott Kirby President 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: Our strategy drives sustainably higher profits and margins
Our strategy drives sustainably higher profits and margins Strengthening our hubs is a critical foundation to maximize profitability Driving revenue improvements from all areas of business Improving efficiency and productivity Greater accountability and transparency
Slide 4: Reaching financial targets will guide our long term network strategy
Reaching financial targets will guide our long term network strategy Target earnings per share, diluted2 1Compound annual growth rate 2Excludes special charges, the nature of which are not determinable at this time. Accordingly, the company is not providing earnings guidance on a GAAP basis Target ~
Slide 5: 2017 had the best operational performance in United history
2017 had the best operational performance in United history D:001 Completion factor1 1 Mainline operation 2 As reported by airlines to the Department of Transportation, compared to Delta, American and Southwest Note: History as defined by time since the merger of United and Continental in October 20
Slide 6: Operational reliability, service and experience underpin customer strategy
2014 (8 of 8) 2017 2015 (7 of 9) 2016 (51 of 9) Operational reliability, service and experience underpin customer strategy Rankings based on on-time performance, cancellations, MBR, complaints and IDB 1 Tied with JetBlue 2 American Airlines and US Airways merged in 2014; Alaska and Virgin America me
Slide 7: 1Q18 guidance update
1Q18 guidance update Prior Update Pre-tax margin, as adjusted1 ~0.0% 0.0% - 2.0% Consolidated capacity 3.5% - 4.5% 3.5% - 4.0% PRASM, H/(L) 0.0% - 2.0% 1.0% - 3.0% CASM ex1,2, H/(L) 0.0% - 1.0% 0.0% - 1.0% Consolidated avg fuel price3 /gal ~$2.11 ~$2.10 1 Excludes special charges, the nature and amo
Slide 8: 1Q18 revenue improving in all regions
Strong close-in yields Easter shift tailwind 1Q18 revenue improving in all regions Domestic Pacific Atlantic Latin Healthy bookings in the front cabin, as well as the economy cabin Positive trends in Central America and Caribbean Beach markets Strong premium cabin results Now expect first-quarter PR
Slide 9: Opportunity – mid-continent hubs not yet fulfilling their potential
Opportunity – mid-continent hubs not yet fulfilling their potential Hub scale UA hubs have lower connectivity than peers Hub profitability directly correlated with hub connectivity and is the most important element of a hub’s success Connectivity UA shrank without reducing fixed costs Asset efficien
Slide 10: Gemini expected to contribute 70 bps of PRASM improvement in 2018
UA System Q3 YOY Gross RASM by YOY Capacity Growth Gemini expected to contribute 70 bps of PRASM improvement in 2018 Gemini vs. Orion test results1 Yield PRASM 1 Stage 1.1 Test ended on Nov 14th and included markets representing 10% of System revenue over a 10-week travel period Note: Gemini is the
Slide 11: Segmentation allows us to compete for all customers
Segmentation allows us to compete for all customers Lowest level of service Highest level of service 2018 launch Extra Legroom Premium Cabin Premium Economy Basic Economy Economy International Domestic Expect to be available in Latin and Atlantic later this year Plan to be available in the fall
Slide 12: Cost effective growth
Cost effective growth Productivity (ASMs/FTEs) Mainline aircraft utilization (Departures/aircraft per day) Gate utilization (Average turns per gate on a peak day1) 1 Peak Thursday in July 2 For a GAAP to non-GAAP reconciliation, see Appendix A Expect 2018 non-fuel CASM2 to be down (1.0%) to flat
Slide 13: Shareholder friendly
Shareholder friendly Target earnings per share, diluted1 Cumulative share repurchases 2 More efficiently utilizing assets will help drive earnings growth Target ~25% CAGR EPS from 2018 through 2020 Plan to continue to return excess cash to shareholders through repurchases $11.00 - $13.00 $6.50 - $8.
Slide 14: UNITED
UNITED
Slide 15: Appendix A: reconciliation of GAAP to Non-GAAP financial measures
Appendix A: reconciliation of GAAP to Non-GAAP financial measures Cost per available seat mile (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 cha