UAL Q1 2021 Earnings

Call Details

• Call Title: United Airlines Holdings, Inc. Q1 2021 Earnings Call
• Date: April 20, 2021 at 2:30 PM UTC
• Management Team:
  • Scott Kirby (Chief Executive Officer)
  • Brett Hart (President)
  • Jon Roitman (Executive Vice President and Chief Operations Officer)
  • Andrew Nocella (Executive Vice President and Chief Commercial Officer)
  • Jerry Laderman (Executive Vice President and Chief Financial Officer)
  • Mike Leskinen (Vice President of Corporate Development and Investor Relations)

Call Summary

Financial Performance

• United reported a Q1 pre-tax loss of $1.8B and an adjusted pre-tax loss of $3.1B.
• The company ended the quarter with $21B of available liquidity including revolver and CARES-related facilities.
• Average daily cash burn in Q1 2021 was $9M per day, representing a $10M per day improvement versus Q4 2020.
• Core cash flow for the month of March was positive and core cash flow is expected to remain positive going forward.
• Q1 TRASM was down 43% and TRASM was down 27% versus 2019, while capacity was down 54% versus Q1 2019.
• Cargo recorded record Q1 revenues of $497M, up 74% versus 2019 and up 88% versus 2020.

Guidance

• The company expects second-quarter TRASM to be down around 20% versus Q2 2019 on capacity down around 45%.
• Second-quarter operating expenses excluding special items are expected to be down about 32% versus Q2 2019 with capacity down around 45%.
• The company expects second-quarter adjusted EBITDA margin to improve by over 40 percentage points from negative 65% in Q1 to close to negative 20% in Q2.
• United stated a clear path to positive adjusted EBITDA even if business and long-haul international demand remain down as much as 70%.
• United expects to return to positive net income once business and long-haul international recover to down 35% versus 2019.
• The company reiterated confidence in exceeding 2019 adjusted EBITDA margins by 2023, conditional on demand recovery and execution of cost saves.