United Airlines has reported its fourth-quarter and full-year 2021 results. Amid a choppy year for the recovery, United Airlines recorded a net loss of $1.9 billion. However, the airline remains upbeat on meeting its bullish financial targets for 2023 and beyond, even in the face of some near-term headwinds.
United records a net loss for 2021
In 2021, United Airlines posted a net loss of $1.964 billion. This was on $24.6 billion of revenue and $25.6 billion in operating expenses. this compares to a $7.1 billion net loss in 2020 and a $3 billion profit in 2019.
Specific to the fourth quarter, United Airlines posted a net loss of $646 million. This compares to a $641 million net profit in the fourth quarter of 2019. The 2021 results included $8.2 billion in total operating revenue and $8.6 billion in operating expenses. United ended 2021 with total available liquidity of $20 billion.
In the fourth quarter of 2021, it also noted total revenue per available seat mile (TRASM) down 3% compared to the fourth quarter of 2019. In terms of cost per available seat mile (CASM), excluding fuel was up 13% compared to the fourth quarter of 2019. These are both common metrics of total unit revenue and unit costs.
Scott Kirby, CEO of United Airlines, stated the following on the results:
"The United team has been fighting through unprecedented obstacles to, once again, overcome the new and daunting challenges that COVID-19 is bringing to aviation, and I am grateful to each one of them for their commitment to taking care of our customers. While Omicron is impacting near term demand, we remain optimistic about the spring and excited about the summer and beyond.
"We look forward to beginning to return the Pratt & Whitney 777s to service this quarter and getting the full airline back to normal utilization — as we ramp up along with demand this year. By investing in innovative technology, focusing on process improvements and implementing a transformative United Next strategy, we're poised to emerge as an aviation leader that's more efficient than before and serves our customers better than ever."
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Digging into the results
Passenger revenue continues to be the primary stream of revenue for United Airlines, but cargo has been a lifeline throughout the crisis. In the fourth quarter, United recorded $727 million in cargo revenue, which was up over 130% compared to 2019. For the full year, United's $2.35 billion of cargo revenue was up over 99% compared to 2019.
On a regional basis, in the fourth quarter, domestic travel made up nearly $5 billion of the $6.9 billion in revenue United earned in the quarter. The next strongest geography for United was the transatlantic market, where it earned $937 million, followed by Latin America at $788 million. The Pacific was the worst, with only $182 million from this geography.
In terms of capacity, United's overall capacity was down 22.8% in the quarter. Domestic was down 13.9%. Transatlantic capacity was down 23.6%, while transpacific capacity was down a whopping 73.9%. However, Latin America was up 8.9% compared to 2019, primarily on the strength of closer international markets in this geography.
Load factors were relatively strong. In the fourth quarter, United recorded a consolidated load factor of 77%, which was down from 82.5% in 2019. Domestic load factors were 83%, which was down slightly from 83.8% in 2019. However, United's international load factor was 66.3%, which was down from 80.8% in 2019.
United's big 2021
While United Airlines suffered some setbacks, including the grounding of 52 Boeing 777s that are expected to start coming back this year, in 2021, it had a lot of strong highlights in a year that started the recovery. One of the biggest was the creation of United's strategy coming out of the crisis, dubbed as "United Next."
United Next included a massive order for 270 new aircraft from both Boeing and Airbus. However, it also included plans to retrofit 100% of United's mainline narrowbody fleet to a new "signature interior" that features an increase in premium seats, larger overhead bins, seatback entertainment at every seat, and a push for faster WiFi. United also accelerated the retirement of 50-seater all-economy regional jets and pulled them entirely out of Newark (EWR) by November.
On the network side, United Airlines added 14 new airports to its network. This included New York's John F. Kennedy International Airport (JFK), Accra (ACC) in Ghana, Lagos (LOS) in Nigeria, Bridgetown (BGI) in Barbados, Dubrovnik (DBV) in Croatia, and Johannesburg (JNB) in South Africa. Meanwhile, in October, United announced five new summer 2022 destinations and a major expansion of services to London. It also ended the year with an announcement of a new partnership with Virgin Australia.