LITTLE ROCK — United Continental Holdings Inc. reported a $620 million quarterly loss on Thursday as travelers stayed away after its problems earlier in the year with absorbing Continental Airlines.
United’s competitor Southwest Airlines Co. said fourth-quarter earnings fell by nearly half on higher spending for fuel, labor and maintenance.
The fourth-quarter loss at United worked out to $1.87 per share. Excluding special items the loss would have been 58 cents per share, matching expectations of analysts surveyed by FactSet. A year ago the company reported a loss of $138 million, or 42 cents per share.
Hurricane Sandy cut $85 million from its results in 2012’s final quarter.
United posted a full-year loss of $723 million, almost wiping out its $840 million profit from 2011.
United’s switch to a single passenger-information system last year caused problems with its website and frustrated some customers when they couldn’t get upgrades to first-class seats. Some of its customer service workers at airports struggled with new software, creating long lines.
Those problems drove potential customers away. Traffic fell 3.2 percent in the fourth quarter. United reduced the amount of flying it did, too, so its planes were actually slightly fuller.
The company is aiming to put those issues behind it. United has said the technology issues are solved.
“With much of our integration behind us, our significantly improved operational performance and our increasing customer satisfaction, we can now go forward as one company,” said Jeff Smisek, chairman, president, and chief executive officer of United Continental Holdings Inc.
Revenue for the full year ticked up slightly to $37.15billion.
“We see improvement this year and expect UAL to narrow the gap between itself and peers on revenue performance,” S&P Capital IQ analyst Jim Corridore wrote in a note.
Shares of the Chicago based United Continental Holdings Inc. rose 54 cents, or 2 percent, to close at $25.54 after rising to a 52-week high of $26.37 in earlier trading.
Southwest Airlines said its revenue rose slightly as the average fare climbed almost $8 higher than a year ago.
Southwest also said that bookings for the first three months of 2013 look strong. It said that based on bookings and ticket prices so far, a key revenue measure should rise by 2 percent to 3 percent in January compared with the same month last year.
Southwest, the nation’s fourth-biggest airline, said Thursday that net income was $78 million, or 11 cents per share. That’s down from $152 million, or 20 cents per share, a year ago.
Excluding items such as fuel contracts, the net income would have been 9 cents per share, beating the 7-cents-per-share forecast among analysts surveyed by FactSet.
Revenue ticked up 1.6 percent to $4.17 billion but fell short of the $4.20 billion that analysts expected.
Expenses rose faster, however, by 3.1 percent. That includes a 4.5 percent increase in labor costs and a 13 percent jump in maintenance as the airline continued to overhaul the cabins inside many of its planes.
Spending on fuel, the airline’s biggest expense, rose a modest 0.7 percent.
Southwest estimated that its fuel bill in the first quarter, which ends March 31, will drop to $3.30 per gallon from $3.44 in the first quarter of 2012, which CEO Gary Kelly called “an encouraging trend.”
The average fourth-quarter fare on Southwest and its AirTran Airways subsidiary was $148.02, up 5.4 percent from $140.38 a year ago.
Passengers flew 1.4 percent fewer miles on Southwest than a year earlier, and planes were less full - 79.6 percent occupancy, down from 80.5 percent.
For all of 2012, Southwest earned $421 million, up from $178 million the year before and its 40th straight profitable year, which Kelly said was “a remarkable feat and a record unmatched in the airline industry.”
Southwest shares rose 9 cents to close at $11.45.
Business, Pages 25 on 01/25/2013