United says winter storm will hit 1Q results
United Airlines says winter storms wiped out 22,500 flights in January and February and hurt its first-quarter revenue.
That's nearly four times the number of flights that United canceled in the first two months last year. About 20,000 of the scrubbed flights occurred on United Express regional flights, which use smaller jets.
Some analysts revised their estimates to forecast a wider loss for the quarter at the Chicago-based airline.
Shares of United Continental Holdings Inc. were down $1.01, or 2 percent, to $45.50 in afternoon trading Friday. They plunged to $44.88, a drop of 3.5 percent, earlier in the session before recovering some ground.
U.S. airlines have canceled more than 80,000 flights since December, the most of any winter season since the government started keeping track more than 20 years ago. United has hub airports in Chicago, Denver and Newark, N.J., that have been particularly hard hit by winter storms.
United said that about 13 percent of its Express regional flights have been canceled so far in 2014, which it called an "extraordinary" level. Because of the lost flights, the airline now expects revenue for every seat flown one mile — a closely watched number in the airline business — will decline between a half-point and 2.5 percent from the first quarter of 2013. United had been predicting the figure would be flat to up 2 percent. The airline added that March results would be hurt by the shift of Easter back to April.
The airline didn't give a dollar figure on lost revenue, but its disclosure after the market closed on Thursday was the most detailed yet from any of the four major airlines.
Cowen and Co. analyst Helane Becker said the disclosure prompted her to predict United would post a first-quarter loss of $1.20 per share from her earlier forecast of a loss of 65 cents per share. J.P. Morgan analyst Jamie Baker said the United comments suggest a loss of about $1.10 per share, and it could go higher. Analysts surveyed by FactSet had predicted that United would lose 61 cents per share.
Baker said that he expected the weather-related impact would be less severe at American Airlines Group Inc. and Delta Air Lines Inc. American declined to comment, and Delta did not immediately respond to a request for comment.
JetBlue Airways Corp. has said that January storms in the Northeast cost it $45 million in revenue and $30 million in operating income. That airline, with big operations in New York and Boston, hasn't updated those numbers for February.