CHICAGO (AP) -- United Airlines' parent company reported a $326 million (euro247.63 million) net loss for January, citing its latest heavy restructuring costs coupled with weak seasonal demand and high fuel costs for the world's second largest airline.
The results reported Friday by UAL Corp. were worse than the $252 million net loss in the same month a year ago and fell short of the benchmark originally set by its bankruptcy lenders. However, the company negotiated a waiver from those banks earlier this month to avoid being in violation of its financing covenant.
The holding company for United Airlines, which has not turned a profit since 2000, said it had an operating loss of $151 million (euro114.7 million) in January despite a 3 percent increase in passenger revenue.
Reorganization expenses totaled $138 million (euro104.82 million) and fuel costs for the month were $63 million (euro47.85 million) higher than a year ago on flat capacity.
''While we made progress in our restructuring during the month by getting in place a portion of the long-term cost savings we need, we still have work to do, including further lowering our costs, concluding our labor negotiations, and the difficult but necessary work of resolving our pension issues,'' chief financial officer Jake Brace said.
UAL said it ended January with a cash balance of $2 billion (euro1.52 billion) -- $855 million (euro649.45 million) of it restricted. The cash balance fell by $108 million (euro82.04 million), reflecting $22 million (euro16.71 million) in quarterly payments to employees as part of the company's incentive plan and seasonally weak cash flow.
The company has been in Chapter 11 bankruptcy since December 2002. Last week it pushed back its targeted exit from bankruptcy until sometime in the fall.
Had fuel costs remained unchanged, the company would have broken even for the month on a net basis.
United Airlines' parent company cites continuing reorganization charges and high fuel costs as its three-year bankruptcy overhaul draws to a finish.
The loss is a result of continuing high costs for its 33-month-old bankruptcy reorganization and the spike in fuel prices.
UAL Corp. said it added too many flights in January during a slow travel season and was hurt by the storms that crippled flying schedules in February.