File: United said it was ready for a rebound and had been cutting costs and building up cash reserves. AFP/Frederic J. Brown
NEW YORK - United Airlines' revenues plunged nearly 80 percent in the third quarter compared to last year's levels, but it signalled preparations for a potential rebound in air travel in its earnings report.
The Chicago-based carrier reported a loss of $1.8-billion on revenues of $2.5-billion, a drop of 78 percent from last year amid the severe hit to air travel from the global COVID-19 pandemic.
But United said it was ready for a rebound and had been cutting costs and building up cash reserves, raising some $22-billion through debt and stock issuance and government relief programmes.
"Having successfully executed our initial crisis strategy, we're ready to turn the page on seven months that have been dedicated to developing and implementing extraordinary and often painful measures, like furloughing 13,000 team members, to survive the worst financial crisis in aviation history," said United chief executive Scott Kirby.
"Even though the negative impact of COVID-19 will persist in the near term, we are now focused on positioning the airline for a strong recovery that will allow United to bring our furloughed employees back to work and emerge as the global leader in aviation."
United said it had available liquidity of $19.4-billion, having borrowed $6.8-billion from private sources and secured the ability to borrow $5.2-billion from the US Treasury.
The tenuous state of air travel has been the focus of negotiations with the White House and Congress on stalled negotiations for a fresh coronavirus relief package.
United said it had reduced total operating costs by 59 percent from the third quarter of 2019 with measures that included an agreement with its pilot group that avoids furloughs by securing flexibility in work hours.
The airline said it is already seeing some improvement in travel compared with earlier this year, and that it resumed nonstop service on 146 domestic routes and restarted or launched service on 78 international routes.
Earlier this week, Delta Air Lines reported a loss of $5.4 billion and said the timing of a full industry recovery remained clouded by the coronavirus pandemic.
Delta, which reported a similar 76 percent plunge in revenue, said it had seen some positive booking momentum heading into the holiday season, but a real recovery depends on a comeback in business travel and the end of travel quarantines.