Nice Job United

[ultrarunner]

Good point Jon, but it's going to happen....I suspect this is the year....UAL will get absorbed..CAL would be crazy to go anywhere NEAR UAL except after a Ch. 7 filing....

Mesa will loose it's legal battles....

There is still WAY too much capacity out there...

 

[Jonny Sacko]

Tilton is an idiot. Even if he plays this off as some means to get the GOV to allow a merge, he's an idiot.

 

[Jon Rivoli]

The socialist are in power now and Barry is from Chicago and the most powerful woman in the world represents SFO. Eject, Eject , Eje... I mean bailout.

 

[GuppyWN]

HOLY COW. I take back everything crappy I've said about WN's Gary Kelly - lately.

You boys need to storm to castle.

Gup

 

[Rez O. Lewshun]

HOLY COW. I take back everything crappy I've said about WN's Gary Kelly - lately.

You boys need to storm to castle.

Gup

With an RLA choker collar?

 

[NavinRJohnson]

That is an unbelievable amount of cash hemorrhaging. Even with an instantaneous management changeover, it will be tough to last through the year.

I know a lot of these losses are 'one time charges', but I believe I saw similar large sums of charges last quarter as well. Who knows what they'll have lost on the books next quarter.

United ALPA should be going into DEFCON 1! I don't know how much they can do, but this is not a storm that can be rode out.

Good luck you guys.

 

[ualdriver]

It is quite a burn through of cash- a negative 1.1B cash flow for the quarter. That's obviously unsustainable but also not likely to continue at that rate into the future (hopefully).

What killed UAL this quarter was a couple of things. They "mark to market" their hedging contracts every quarter, so just that loss alone was 580M, with more (but much less) coming until April 2009. Other airlines may/may not use the "mark to market" method, so they may not show that sort of large loss all at once, but one way or the other, if an airline hedged, it will be taking massive losses as they are required to put collateral up for these contracts (assuming the commodity they hedged stays low). We won't be alone in that regard unfortunately. And the collateral/loss is pure cash burn for the airlines- bad when the guy who runs out of cash first loses.

Throw in another 400M in debt that was paid down during the quarter and the regular loss for the traditionally weak 4th quarter, and you get just over 1B *poof* gone.

There's 2B in unrestricted cash left and 2B in unencombered assets. Obviously they're not going to be burning through 1B per quarter over the next several quarters, but certainly you can't bleed through cash forever, no matter what the reason.

 

[Yuppyguppy]

Just wait until they have to deal with all 4 unions at once at the end of this year....Chapt 11 is a sure thing.

 

[whatitdoing?]

Chapt 11 is a sure thing. Without a doubt.

 

[contrail67]

It has been a sure thing for quite some time here on all knowing FI.com. Has not happened.