United and American Airlines have become the fourth and fifth major carriers to warn that the US economic slowdown will crimp first-quarter performance. United also said its full-year 2001 financials would be lower than Wall Street estimates.
United said its first-quarter results would be "substantially lower" than the consensus estimates of a $2.82 a share loss compiled by the firm First Call. Higher-yield business traveller bookings are down as the economy softens, said United chairman and chief executive James Goodwin. United lost $124 million in last year's fourth quarter.
American expects "to post a modest loss in the first quarter" because of softer overall demand, bad weather and a labour disruption in late February of its New York operations, it said in a Securities and Exchange Commission filing. American would not say how much it expected to lose, although First Call had predicted a 34ó a share profit.
Their warnings follow recent earnings warnings issued by Delta Air Lines, Northwest Airlines and US Airways for the quarter. Delta said it would lose between $85 million and $100 million in the quarter, while Northwest is looking at a loss of $130 million to $150 million and US Airways said it would lose more than $75 million. Like Delta, United said labour woes played a role in its predicament.
Source: Airline Business
