Published November 23, 2005
CHICAGO – UAL Corp. (UALAQ.OB), parent of bankrupt United Airlines, Wednesday reported a net loss for October as reorganization expenses weighed on its bottom line.
The No. 2 U.S. carrier lost $698 million, including $584 million in largely noncash reorganization expenses related to the termination of the pilots' defined benefit pension plan. Excluding reorganization expenses, the net loss was $114 million.
UAL said in its report filed with U.S. Bankruptcy Court that bankrupt companies often see charges related to restructuring, especially as the reorganization nears an end.
The carrier filed for bankruptcy in December 2002 and aims to emerge early next year.
UAL said its operating loss increased to $71 million for October from $65 million a year earlier.
The company linked the loss partly to a 53 percent rise in fuel prices, which resulted in a $169 million increase in fuel expenses versus last year.
"United's revenue performance and cost reductions were offset by record high fuel costs," said Jake Brace, UAL's chief financial officer, in a statement.
UAL ended October with a cash balance of $2.7 billion, which included $964 million in restricted cash.