Continental says it earned $85 million in the last three months, as fuel prices plunged by about a third compared to the previous year. Analysts had expected another loss, but Continental Chairman and CEO Jeff Smisek had a surprise in their fourth-quarter financial results conference call.
“For the full year 2009, we reported a net loss of $295 million, or diluted loss per share of $2.28. For the fourth quarter of 2009, Continental reported a net income of $4 million, or a profit of three cents per diluted share, excluding $77 million of previously-announced special charges and $158 million non-cash income tax benefit. Including those special charges and the income tax benefit, we reported a net income of $85 million, or a profit of 60 cents per diluted share for the quarter.”
The nation’s fourth-largest airline increased passenger traffic by 3.5 per cent in late 2009, even as fourth-quarter revenue declined by 8.3 per cent because high-paying customers have been affected by the recession. Smisek says business traffic is increasing, although the recovery will be slow.
“And we will make many changes to find ways to increase revenue and decrease costs. One the revenue side, in addition to tapping into the power of Starline and optimizing traditional revenue management, over time you’ll see us offering customer more control over their travel experience. On the day of departure, if after all Elite upgrades have been made there are still first-class seats available for sale, we offer customers an opportunity to buy a day of departure upgrade to first class. Last year, we generated over $25 million for this program.”
Continental and other airlines are making up some ticket revenue decline by raising checked-bag fees.