United Airlines parent UAL Corp. said Wednesday it expects a key measure of passenger revenue to rise by as much as 8.5% in the third quarter as it benefits from both packed planes and higher fares than a year ago.
In a filing with the Securities and Exchange Commission, UAL said passenger revenue per available seat mile, or the amount the airline makes for each seat flown, is forecast to increase 7.5% to 8.5% year-over-year for mainline operations. It is expected to climb 6.75% to 7.75% overall.
Chairman and CEO Glenn Tilton said the nation's No. 2 carrier is continuing the momentum from a solid second quarter.
Cost per available seats flown, excluding fuel and other items, is expected to rise 5.25% to 5.75% overall. The figures include $31 million in additional expenses from profit-sharing programs and a non-cash charge for surplus and obsolete maintenance inventory not included in an earlier forecast.
United's load factors _ measuring how full planes were compared with their seating capacity reached a record 89.1% for June, 87.3% for July and 86.3% for August as U.S. airlines benefited from a busy summer travel season.
Mainline traffic, or that from flights not counting its regional United Express operations, is expected to be flat or fall by as much as 1% compared with the same quarter last year. Including the regional flights, traffic is forecast to be half a percentage point above or below the year-earlier quarter.
Mainline capacity is expected to fall 1.5%, with consolidated capacity dropping 1.2%.
In a note to employees, Tilton said United's passenger unit revenue performance for the quarter is expected to be among the best in the industry.
"The third-quarter financial guidance we issued today is further proof of the positive momentum of the company," he said.