In its first quarter results report, United Airlines (UAL) says that it focused on returning to positive adjusted EBITDA margins, “even if business and long-haul international demand remain as much as 70% below 2019 levels”.
United states that it is “already moving to capitalize on emerging pent-up demand for travel to countries where vaccinated travelers are welcome”. The company announced new international flying to Greece, Iceland and Croatia on the same day, subject to government approval. Starting in July, United will offer new direct flights from Newark Liberty International Airport to Dubrovnik, Croatia, from Washington Dulles International Airport to Athens, Greece and from Chicago O'Hare International Airport to Reykjavik, Iceland, all subject to government approval.
United claims such opportunistic steps help position the airline to return to positive net income “even if business and long-haul international demand only returns to about 35% below 2019 levels”.
"The United team has now spent a year facing down the most disruptive crisis our industry has ever faced and because of their skill and dedication to our customers, we're poised to emerge from this pandemic with a future that is brighter than ever," said United Airlines CEO Scott Kirby. "We've shifted our focus to the next milestone on the horizon and now see a clear path to profitability. We're encouraged by the strong evidence of pent-up demand for air travel and our continued ability to nimbly match it, which is why we're as confident as ever that we'll hit our goal to exceed 2019 adjusted EBITDA margins in 2023, if not sooner."
United reported first-quarter 2021 net loss of $1.4 billion, and an adjusted net loss of $2.4 billion. Operating revenue for the quarter was down 66% to $3.2 billion compared to first-quarter 2019, with operating expenses down 49%. Capacity remains down by more than half of 2019 levels.
United ended the first quarter with $21bn in available liquidity. Average core cash burn is down to $9 million per day.
United expects second quarter 2021 Total Revenue Per Available Seat Mile (TRASM) to be down approximately 20% versus the second quarter 2019, with capacity down by 45%.