THE ASSOCIATED PRESS
October 19, 2002
Chicago - The parent company of ailing United Airlines reported an $889 million third-quarter loss Friday, its second-biggest setback ever, reflecting the continued bleak environment for U.S. carriers.
It was the ninth consecutive quarterly loss for UAL Corp., which is negotiating with its unions to shed billions of dollars in costs in a bid to avoid filing for bankruptcy.
Its only worse quarterly result was a $1.16 billion loss in last year's third quarter, when the terrorist attacks set off the industry's current tailspin.
United announced Friday that company and union leaders have set a target of $5.8 billion in labor-cost savings over 5 1/2 years - a middle ground between what management had sought and unions had publicly agreed to provide.
But chief financial officer Jake Brace acknowledged that negotiations with individual unions are moving "at various paces," an apparent reference to resistance by the powerful machinists union.
The 55 percent employee-owned company was also seeking a $1.8 billion federal loan guarantee so it can meet impending debt payments.
The latest net loss at the Elk Grove Village, Ill.-based company was almost twice the consensus estimate of analysts surveyed by Thomson First Call.
The announcement came a day after Delta Air Lines announced that it was slashing 7,000 to 8,000 additional jobs across the board.
With those cuts, Delta has now trimmed 21,000 jobs, or 25 percent of its work force, since Sept. 11, 2001.
Also Thursday, Continental, Northwest and America West posted third-quarter losses, while Southwest - the only major carrier to record a profit - warned that its streak of 46 quarters of profitability could end soon.
UAL shares fell 3 cents to close at $1.70 on the New York Stock Exchange.
Newsday - UAL out $889 Million in 3d quarter