f010711form8k.htm


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K
CURRENT REPORT

Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):   January 7, 2011

UNITED CONTINENTAL HOLDINGS, INC.
UNITED AIR LINES, INC.
CONTINENTAL AIRLINES, INC.

(Exact name of registrant as specified in its charter)

Delaware
 
001-06033
 
36-2675207
Delaware
 
001-11355
 
36-2675206
Delaware
 
001-10323
 
74-2099724
(State or other jurisdiction
 
(Commission File Number)
 
(IRS Employer
of incorporation)
     
Identification Number)

77 W. Wacker Drive, Chicago, IL
 
60601
77 W. Wacker Drive, Chicago, IL
 
60601
1600 Smith Street, Dept. HQSEO, Houston, Texas
 
77002
(Address of principal executive offices)
 
(Zip Code)

(312) 997-8000
(312) 997-8000
(713) 324-2950
Registrant’s telephone number, including area code 


(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))


 



 
 

 


 
Item 7.01 Regulation FD Disclosure.
 

On January 7, 2011, United Continental Holdings, Inc. issued a press release reporting the December 2010 operational performance of United Air Lines, Inc. and Continental Airlines, Inc., its wholly owned subsidiaries.  The press release is furnished herewith as Exhibit 99.1 and is incorporated herein by reference.
 
The information in this Item 7.01, including Exhibit 99.2, is being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section and shall not be deemed incorporated by reference into any registration statement or other document filed pursuant to the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.
 

Item 9.01   Financial Statements and Exhibits.

Exhibit No.
 
Description
     
99.1*
 
Press Release issued by United Continental Holdings, Inc. dated January 7, 2011


* Furnished herewith electronically.




 
 

 



SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 
UNITED CONTINENTAL HOLDINGS, INC.
 
 
UNITED AIR LINES, INC.
 
 
CONTINENTAL AIRLINES, INC.
 
       
       
       
 
By:
/s/ Chris Kenny
 
 
Name:
Chris Kenny
 
 
Title:
Vice President and Controller
 
       
       
Date:  January 7, 2011
     



 
 
 

 
 
 
EXHIBIT INDEX

Exhibit No.
 
Description
     
99.1*
 
Press Release issued by United Continental Holdings, Inc. dated January 7, 2011


* Furnished herewith electronically.

exhibit991.htm

 
Exhibit 99.1
News Release
 
United Continental Holdings, Inc.
 
Worldwide Media Relations
 
312.997.8640
713.324.5080
 
media.relations@united.com
media.relations@coair.com
 

UNITED CONTINENTAL HOLDINGS REPORTS DECEMBER 2010
OPERATIONAL PERFORMANCE FOR UNITED AND CONTINENTAL

CHICAGO, Jan. 7, 2011 – United Continental Holdings, Inc. (NYSE: UAL) today reported December 2010 and full-year 2010 operational results for United Air Lines, Inc. and Continental Airlines, Inc.
 
United and Continental’s combined consolidated traffic (revenue passenger miles) in December 2010 increased 1.4 percent versus December 2009 on a consolidated capacity increase of 2.3 percent. The carriers' combined consolidated load factor decreased 0.7 points compared to the same period last year.
 
United and Continental’s December 2010 combined consolidated passenger revenue per available seat mile (PRASM) increased an estimated 7.5 to 8.5 percent compared to December 2009, while mainline PRASM increased an estimated 8.5 to 9.5 percent compared to the same period last year.  In December, the carriers implemented a revenue sharing structure for their trans-Atlantic joint venture, retroactive to Jan. 1, 2010.  While the impact of the joint venture obligations for the first through third quarter 2010 will be booked as a charge in Other Operating Expense in United Continental Holdings' statement of consolidated operations, the fourth quarter impact and all future adjustments will be booked as adjustments to passenger revenue. The fourth quarter adjustment, which was booked entirely in the month of December, reduced the carriers’ December consolidated PRASM by approximately 1.0 point and is included in the above consolidated PRASM estimate.
 
The snowstorms during the month of December resulted in an estimated $25 million reduction in consolidated passenger revenue, included in the above consolidated PRASM estimate, and a $10 million reduction in net earnings for the quarter.
 
About United Continental Holdings, Inc.
 
United Continental Holdings, Inc. (NYSE: UAL) is the holding company for both United Airlines and Continental Airlines. Together with United Express, Continental Express and Continental Connection, these airlines operate a total of approximately 5,800 flights a day to 371 airports on six continents from their hubs in Chicago, Cleveland, Denver, Guam, Houston, Los Angeles, New York/Newark Liberty, San Francisco, Tokyo and Washington, D.C. United and Continental are members of Star Alliance, which offers 21,000 daily flights to 1,160 airports in 181 countries. United and Continental’s more than 80,000 employees reside in every U.S. state and in many countries around the world. For more information about United Continental Holdings, Inc., go to UnitedContinentalHoldings.com. For more information about the airlines, see united.com and continental.com, and follow each company on Twitter and Facebook.
-tables attached-
 
Combined United and Continental Pro Forma Preliminary Operational Results
                     
   
December
 
Full Year
   
2010
2009
Change
 
2010
2009
Change
REVENUE PASSENGER MILES (000)
               
 
North America
7,858,291
8,003,593
-1.8
%
 
97,507,989
98,746,482
-1.3
%
                     
 
International
7,069,016
6,795,374
4.0
%
 
87,071,891
81,657,835
6.6
%
 
Atlantic
2,922,123
2,964,483
-1.4
%
 
39,677,750
37,965,601
4.5
%
 
Pacific
2,735,219
2,485,162
10.1
%
 
31,875,965
28,967,243
10.0
%
 
Latin America
1,411,674
1,345,729
4.9
%
 
15,518,176
14,724,991
5.4
%
                     
 
Mainline
14,927,307
14,798,967
0.9
%
 
184,579,880
180,404,317
2.3
%
 
Regional
2,069,155
1,963,059
5.4
%
 
25,960,758
23,081,741
12.5
%
 
Consolidated
16,996,462
16,762,026
1.4
%
 
210,540,638
203,486,058
3.5
%
                     
AVAILABLE SEAT MILES (000)
               
 
North America
9,496,043
9,654,499
-1.6
%
 
114,894,643
117,360,768
-2.1
%
                     
 
International
8,591,234
8,119,595
5.8
%
 
105,165,406
102,942,547
2.2
%
 
Atlantic
3,587,004
3,504,947
2.3
%
 
48,045,291
47,181,413
1.8
%
 
Pacific
3,222,436
2,949,439
9.3
%
 
37,829,729
37,410,213
1.1
%
 
Latin America
1,781,794
1,665,209
7.0
%
 
19,290,386
18,350,921
5.1
%
                     
 
Mainline
18,087,277
17,774,094
1.8
%
 
220,060,049
220,303,315
-0.1
%
 
Regional
2,721,244
2,571,256
5.8
%
 
33,034,260
30,125,640
9.7
%
 
Consolidated
20,808,521
20,345,350
2.3
%
 
253,094,309
250,428,955
1.1
%
                     
PASSENGER LOAD FACTOR
               
 
North America
82.8%
82.9%
-0.1
 pts
84.9%
84.1%
0.8
 pts
                     
 
International
82.3%
83.7%
-1.4
 pts
82.8%
79.3%
3.5
 pts
 
Atlantic
81.5%
84.6%
-3.1 
 pts
 
82.6%
80.5%
2.1
 pts
 
Pacific
84.9%
84.3%
0.6
 pts
 
84.3%
77.4%
6.9
 pts
 
Latin America
79.2%
80.8%
-1.6
 pts
 
80.4%
80.2%
0.2
 pts
                     
 
Mainline
82.5%
83.3%
-0.8
 pts
83.9%
81.9%
2.0
 pts
 
Regional
76.0%
76.3%
-0.3
 pts
78.6%
76.6%
2.0
 pts
 
Consolidated
81.7%
82.4%
-0.7
 pts
83.2%
81.3%
1.9
 pts
                     
ONBOARD PASSENGERS (000)
               
 
Mainline
8,055
8,188
-1.6
%
 
99,452
101,751
-2.3
%
 
Regional
3,661
3,565
2.7
%
 
46,098
42,581
8.3
%
 
Consolidated
11,716
11,753
-0.3
%
 
145,550
144,332
0.8
%
                     
CARGO REVENUE TON MILES (000)
               
 
Total
244,714
251,995
-2.9
%
 
3,001,839
2,552,307
17.6
%
                     
(more)



Combined United and Continental Pro Forma Preliminary Financial Results
             
Change
November 2010 year-over-year consolidated PRASM change
            11.7
 Percent
November 2010 year-over-year mainline PRASM change
            12.4
 Percent
December 2010 estimated year-over-year consolidated PRASM change
 7.5 - 8.5
 Percent
December 2010 estimated year-over-year mainline PRASM change
 8.5 - 9.5
 Percent
December 2010 estimated consolidated average price per gallon of fuel, including fuel taxes1
            2.49
 Dollars
Fourth Quarter 2010 estimated consolidated average price per gallon of fuel, including fuel taxes1
            2.44
 Dollars
                 
 Preliminary December Operational Results for United and Continental
                 
United Airlines
2010
2009
Change
On-Time Performance2
83.1%
77.3%
              5.8
 Points
Completion Factor3
97.9%
97.2%
              0.7
 Points
                 
Continental Airlines
2010
2009
Change
On-Time Performance2
72.1%
70.7%
              1.4
 Points
Completion Factor3
96.8%
98.9%
             (2.1)
 Points
                 
1 Excluding non-cash, net mark-to-market gains and losses
2 Department of Transportation Arrivals within 14 minutes
3 Mainline Segment Completion Percentage

GAAP to Non-GAAP Reconciliations
Pursuant to SEC Regulation G, the Company has included the following reconciliation of reported non-GAAP financial measures to comparable financial measures reported on a GAAP basis.  Since the Company did not apply cash flow hedge accounting prior to April 1, 2010, the Company believes that the net fuel hedge adjustments provide management and investors with a better perspective of its performance and comparison to its peers because the adjustments reflect the economic fuel cost during the periods presented and many of our peers apply cash flow hedge accounting.  The non-cash mark-to-market gain/loss adjustment includes the reversal of prior period non-cash mark-to-market gain/loss related to actual December and actual fourth quarter hedge s ettlements.

Combined United and Continental Pro Forma
         
         
December 2010
4Q 2010
Consolidated fuel price per gallon (GAAP)
     2.50
 Dollars
      2.46
 Dollars
Less: Non-cash, net mark-to-market gains and (losses) per gallon
     (0.01)
Dollars
      (0.02)
 Dollars
Consolidated fuel price per gallon excluding non-cash, net mark-to-market gains and losses
        2.49
 Dollars
         2.44
 Dollars
                 




Safe Harbor Statement
Certain statements included in this release are forward-looking and thus reflect our current expectations and beliefs with respect to certain current and future events and financial performance. Such forward-looking statements are and will be subject to many risks and uncertainties relating to our operations and business environment that may cause actual results to differ materially from any future results expressed or implied in such forward-looking statements. Words such as “expects,” “will,” “plans,” “anticipates,” “indicates,” “believes,” “forecast,” “guidance,” “outlook” and similar expressions are intended to identify forward-looking statements.  ; Additionally, forward-looking statements include statements which do not relate solely to historical facts, such as statements which identify uncertainties or trends, discuss the possible future effects of current known trends or uncertainties, or which indicate that the future effects of known trends or uncertainties cannot be predicted, guaranteed or assured. All forward-looking statements in this release are based upon information available to us on the date of this release. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, changed circumstances or otherwise, except as required by applicable law. Our actual results could differ materially from these forward-looking statements due to numerous factors including, without limitation, the following: our ability to comply with the terms of our various financing arrangements; the costs and availability of financing; our ability to maintain adequate liquidity; our a bility to execute our operational plans; our ability to control our costs, including realizing benefits from our resource optimization efforts, cost reduction initiatives and fleet replacement programs; our ability to utilize our net operating losses; our ability to attract and retain customers; demand for transportation in the markets in which we operate; an outbreak of a disease that affects travel demand or travel behavior; demand for travel and the impact that global economic conditions have on customer travel patterns; excessive taxation and the inability to offset future taxable income; general economic conditions (including interest rates, foreign currency exchange rates, investment or credit market conditions, crude oil prices, costs of aviation fuel and energy refining capacity in relevant markets); our ability to cost-effectively hedge against increases in the price of aviation fuel; any potential realized or unrealized gains or losses related to fuel or currency hedging programs; the effects of an y hostilities, act of war or terrorist attack; the ability of other air carriers with whom we have alliances or partnerships to provide the services contemplated by the respective arrangements with such carriers; the costs and availability of aviation and other insurance; the costs associated with security measures and practices; industry consolidation or changes in airline alliances; competitive pressures on pricing and on demand; our capacity decisions and the capacity decisions of our competitors; U.S. or foreign governmental legislation, regulation and other actions (including open skies agreements); labor costs; our ability to maintain satisfactory labor relations and the results of the collective bargaining agreement process with our union groups; any disruptions to operations due to any potential actions by our labor groups; weather conditions; the possibility that expected merger synergies will not be realized or will not be realized within the expected time period; and other risks and uncertainties set forth under Item 1A., Risk Factors of Annual Report on Form 10-K, as well as other risks and uncertainties set forth from time to time in the reports we file with the SEC. Consequently, forward-looking statements should not be regarded as representations or warranties by us that such matters will be realized.
###