United sees exit from bankruptcy
October 30, 2003
By Sapa-AP
Chicago - United Airlines remains on track to emerge from bankruptcy late next spring and turn a profit for 2004 after seeing encouraging progress this summer and fall, CEO Glenn Tilton said.
Tilton declined to say when United would file its new business plan in federal bankruptcy court, nor would he disclose any new specifics about the low-cost carrier it intends to launch next year from its Denver hub.
But in brief comments Wednesday to reporters, he said United outperformed the industry average in the last two months, is meeting its bankruptcy lenders' strict monthly financial benchmarks and has a positive daily cash flow of $4 million to $5 million.
Passenger demand in the Pacific region, which fell off sharply this year with the outbreak of severe acute respiratory syndrome, has returned to pre-SARS levels, he said. United is more dependent on traffic from that region than other US carriers.
The Elk Grove Village, Illinois-based airline reports third-quarter results on Thursday which are expected to show significant progress, similar to other carriers, which benefited from a busy summer travel season. Tilton indicated there has been no drop this month.
"I'm really encouraged by October," he said following a speech to the Executives' Club of Chicago. "I'm especially encouraged by the mix of business. ... I'm very encouraged by the fact the Pacific has come back as strong as it has. The market that we need to work on further is the Atlantic."
He attributed sluggish demand in that region to many passengers' continuing disinclination to fly.
The airline is targeting operating profitability for all of 2004, although Tilton said the high volatility of the business make forecasts difficult.
"Obviously we envision a sustainable cash flow and sustainable profitability," he said. "We're just powering forward on a financial, operating and market basis."
United shares rose 2 cents Wednesday to close at $1.06 in over-the-counter trading. - Sapa-AP
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