Originally Posted by krudawg

Investor Update Issue Date: January 9, 2015
This investor update provides guidance and certain forward looking statements about United Continental Holdings, Inc. (the “Company”
or “UAL”). The information in this investor update contains preliminary financial and operational results for the Company for fourth
quarter and full-year 2014 and forward looking statements for other periods.
Capacity
The Company’s fourth-quarter 2014 consolidated system available seat miles (“ASMs”) increased an estimated 0.9% as compared to
the same period in the prior year. UAL’s fourth-quarter 2014 consolidated domestic ASMs decreased approximately 1.4% and
consolidated international ASMs increased an estimated 3.9% versus the fourth quarter of 2013. The Company estimates its full-year
2014 consolidated system ASMs increased 0.3% year-over-year.
Revenue
The Company’s fourth-quarter 2014 consolidated passenger revenue per available seat mile (“PRASM”) increased between 0.25% and
0.75% versus the fourth quarter of 2013. This guidance is negatively impacted by 1.5 percentage points related to certain interline ticket
reconciliations the Company recorded in the fourth quarter of 2013. UAL expects its fourth-quarter 2014 cargo revenue to be between
$250 million and $270 million and expects its fourth-quarter 2014 other revenue to be between $960 million and $980 million.
For the full year 2014, consolidated PRASM increased between 1.6% and 1.7% year-over-year. United expects cargo revenue to be
between $928 million and $948 million and other revenue to be between $4.19 billion and $4.21 billion.
Non-Fuel Expense
For the fourth quarter 2014, the Company expects consolidated cost per ASM (“CASM”), excluding profit sharing, fuel, third-party
business expenses and special charges, to increase 0.75% to 1.75% year-over-year. The Company expects full-year 2014
consolidated CASM, excluding profit sharing, fuel, third-party business expenses and special charges, to increase 1.2% to 1.4% yearover-
year.
The Company expects to record approximately $65 million of third-party business expense in the fourth quarter and approximately $534
million for full-year 2014. Corresponding third-party business revenue associated with third-party business activities is recorded in other
revenue.
Fuel Expense
United estimates its consolidated fuel price to be $2.83 for the fourth quarter 2014, including $0.25 of cash-settled hedge losses. In the
quarter, the Company closed out two percentage points of its 2015 hedge positions, adding approximately $0.09 per gallon to its cashsettled
hedge losses. The Company is now 22% hedged for its 2015 fuel consumption. Including the early settlement of these 2015
hedge positions, United expects approximately $237 million in cash settled hedge losses in the fourth quarter, with $85 million of losses
in fuel expense and $152 million of losses in non-operating expense.
For the full year 2014, UAL estimates its consolidated fuel price, including cash-settled hedges, to be $3.03 per gallon.
Non-Operating Expense
The Company estimates non-operating expense to be between $330 million and $350 million for the fourth quarter 2014 and between
$833 million and $853 million for full-year 2014. These estimates include cash settled hedge losses of approximately $152 million in the
fourth quarter of 2014. The Company excludes the non-cash impact of fuel hedges from its non-operating expense guidance and non-
GAAP earnings.
Profit Sharing and Share-Based Compensation
For 2014, the Company will pay approximately 10% of total adjusted earnings as profit sharing to employees for adjusted earnings up
to a 6.9% adjusted pre-tax margin and approximately 14% for any adjusted earnings above that amount. Adjusted earnings for the
purposes of profit sharing are calculated as GAAP pre-tax earnings, excluding special items, profit sharing expense and share-based
compensation program expense. Share-based compensation expense for the purposes of the profit sharing calculation is estimated to
be $111 million for full-year 2014.
Capital Expenditures and Scheduled Debt and Capital Lease Payments
The Company expects between $1.01 billion and $1.03 billion of gross capital expenditures in the fourth quarter and approximately $3.1
billion for the full year 2014, including net purchase deposits. UAL’s gross capital expenditures exclude fully reimbursable capital
projects.
The Company expects debt and capital lease payments of approximately $530 million in the fourth quarter and approximately $2.6
billion for full-year 2014, including all pre-payments made year to date. The difference versus prior fourth quarter guidance is primarily
attributable to the early retirement of $20 million of debt due in future years.