United Airlines Holdings, Inc. · NASDAQ:UAL
United Airlines — United Continental Holdings — Investor Presentation (June 2016)
25 slides from United Airlines's investor presentation, Jun 21, 2016
Slide 1: Investor Update Call
Exhibit 99.2 Investor United Oscar President Jim Vice June A STAR Compton Chairman 21, Munoz Continental Call 2016 ALLIANCE and Chief and Holdings, Chief Executive MEMBER Revenue Inc. Officer Officer
Slide 2: Safe Harbor Statement
Safe Certain forward-looking or identify possible this information, without operational fleet travel economic currency arrangements and regulations); results 2under Commission. implied political on presentation replacement Harbor demand Part of demand; statements limitation, forward-looking future h
Slide 3: Purpose of today's call
3nPurpose Continue Share Plan toupdate ofhost today’s with anonopen, investor efforts calldirect already dayand in the frequent underway fourthdialogue quarter to improve of 2016 financial performance
Slide 4: We have built strong building blocks
We Strong üImproved Engaged workforce Flexible fleet 421üGrew Year-end Full-year have balance building pre-tax Healthy confidence Global networküRemoved 2015 operational 2015 sheet earnings blocks as as üExpect compared compared in our Signs performance ex.$1B+ ability special of to to $6Bprogress i
Slide 5: Pre-tax margin performance has lagged peers
…but Pre-tax UAL 16%n 18% 10%n 12% n8% domestic 4% 2% (2%)n 20113 321Incl. chart AAL Twelve Seat UAL 6% 0%special vs. financial Integration Had 2012 share Lost (pro-forma numbers margin1 peers2 profitability months operational share 2013 items declined performance What inended of 2014 was Excl. prio
Slide 6: We are focused on improving financial performance
64321We Current Earnings Network Looking are focused priorities ahead and accretive commercial on improving initiatives objectives relative underway financial performance
Slide 7: Our current priorities
nOur Rebuild currenttrust priorities with employees are foundational and customersn to our future Continue success to operate reliably while driving efficiencyn Grow share of premium customers n Execute successfully in all areas of the business
Slide 8: Earnings and accretive initiatives underway
84321We Current Earnings Network Looking are focused priorities ahead and accretive commercial on improving initiatives objectives relative underway financial performance
Slide 9: Executing initiatives that will drive incremental $3.1B by 2018
Executing initiativesthat will drive incremental $3.1B by 2018 Driving incremental 9~$300M by 2018 ~$1.5B revenue by 2018 Generating ~$1.3Bbenefits by 2018from through commercial Improving cost structure improved operations enhancements
Slide 10: Improving operations to re-attract premium customers
Strong Re-attract Reduce nImprove Expect 10Deliver Rebook Decrease Reduce operations sustained re-accommodations cost schedule consistent operational fewer premium number of irregular passengers operational expected quality of customers experience buffers passengers operations to onimprovements (e.g
Slide 11: Further revenue segmentation and customer choice
Further Revenue $Customer (~$750M ~50% n$6.53n $0.9B 1Annual 11per passenger Grow ~20% Entry Bundled Includes $16—$17 $1.5B Introduce segmentation level industry-leading increase by choice revenue products 2018) $2.5B faresin revenue1 new (~$150M from Economy impact (~$100M will products ancillary e
Slide 12: Additional revenue: MileagePlus and Optimizer
Additional Revenue nMileagePlus $200M by 12Impact Optimizer 2018n 2018Next revenue of Enhancements revenue credit advancements generation managementn card enhancements rate to reduce escalation improve Showing will dilution customers’ due generate strong to and new improve ability $500M results $300
Slide 13: Slimline seats and upgauge cost benefits
Slimline Costs Average Seats 125 121 120 111 115 110 105 100 2015 % 1Includes complete 15% $600 +$800 $1,400 117 $250 2016E 2018E per$500 consolidated and departure $900 fuel of 2017E upgauge and Revenue $350 non-fuel ($M) 2018E gauge expected Cost1 cost Structural ~30% tobenefit drive ~50% net ~$80
Slide 14: Expect non-fuel cost efficiency
Expect Costs nCost ($M) $1,200 complexity $1,500 $200n $380 2014 2013 Maintain 14Migration efficiency $1,000 2015 program More $500 ~$500M average 2016E to efficient $1,000n 2016 single programs benefit annual 2018En program maintenance use New from non-fuel of Examples Continued tools in-house sens
Slide 15: Expect incremental earnings of $3.1B by 2018
Expect 2015 $M Operational Commercial Customer Cost Slimline Total Incremental 15 structure 2016E $2.3B $3.1B and choice $3.4B integrity—$100 benefit 2017E enhancements upgauge of value revenue $4.4B 2018E from program from 2015 $5.4B $1,500 Improved earnings $200 $3.1B $600 $1,800 $300 $900 operati
Slide 16: Network
13We 4216Network Current Earnings Looking are focused priorities ahead and accretive commercial on improving initiatives objectives relative underway financial performance
Slide 17: Our hubs
nOur 17Hubs Coastal San Newark Houston #1 network seat Francisco located share hubs isserves the has well-positioned inonly ismany the United big, thetrue most premier business-centric strengths… hub international, destinations metro Pacific for international areas gateway cities to connecting excep
Slide 18: International returns perform well
…and Return 2000 112.7% 114.1% 2010 1Our available Return international 2005 2015 our onon seat revenue1 international 2010 Domestic revenue: mile 2015 returns adjusted International International income/loss entity consistently forcontinues length PRASM2 derived higher oftohaul from perform premium
Slide 19: Domestic capacity share has eroded
…however, Domestic Available 146 (6%) 109.2% 2010 21Our UAL Passenger 36% domestic 2015 metro 31% 110.7% seat consolidated 2010 our revenue 137 seats/all capacity miles domestic 2015(billions) per 2010 metro declined… capacity available position 2015 seats Seat seat has in …leading domestic share er
Slide 20: Improving the customer experience
Continuing üfriendly 20Improving Elevating tools to food reliability like invest and innovative in beverage and travel schedule mobile experience offerings utility app forücustomers Adding premium seats in key business marketsü Reimagining travel with United Polaris Business Classü Transforming the
Slide 21: Commercial objectives
Commercial nKey growth experiencen Now 21Grow commercial expect in capacity ‘152Q16 Introduced objectives andin-line objectives ‘16 PRASM reduced will improvements withActions to strengthen demandn be erosion (6.5%)—(7.5%) already non Grew our Fly ground competitive underway more consolidated and ye
Slide 22: We are focused on improving financial performance
focused are We 4L performance financial relative 1improving 3222 ooking Currenton Earnings Network ahead priorities and accretive commercial initiatives objectives underway
Slide 23: As we look ahead
nAsRefine 23Maintain we look thestrong ahead mission reliability at United for eachwhile geographic improving region, efficiency hub and spoken Implement the profit maximizing product and segmentation strategyn Further identify and address controllable cost gap to peers
Slide 24: Question & Answer Session
Question & Answer Session
Slide 25: Appendix A: Reconciliation of GAAP to non-GAAP
Appendix UAL taxes GAAP special Twelve March 2016 (in Add: Pre-tax items 1Total March millions) 2015 Special evaluates Operating excluding –31, basis. items, income Non-GAAP Months 31, A: December 2015 2011 Reconciliation UAL Items see its /(loss) excluding Ended1 special Revenue 2015 Note and finan
United Continental Holdings — Investor Presentation (June 2016) on 6ix