Continental Airlines reports 2006 net income of $343 million
Continental Airlines reported 2006 net income of $343 million ($3.30 diluted earnings per share), a substantial improvement over the 2005 net loss of $68 million. (1/19/2007)
2006 net income includes a $92 million gain on the sale of a portion of the company’s investment in Copa Airlines and a net charge from other special items of $53 million. Excluding special items, Continental’s net income for the full year was $304 million ($2.95 diluted earnings per share), a substantial improvement over the 2005 net loss of $205 million excluding special items, stated the airline.
“In spite of fuel price increases costing over $510 million year-over-year, 2006 net income improved on strong revenue growth, which was up 17.1 percent year-over-year, and continued cost reduction initiatives,” it added.
Terming the performance as a solid one for the year, Larry Kellner, Continental’s chairman and chief executive officer said, “We look forward to distributing $111 million in profit sharing on Valentine´s Day.”
“We believe that we are well positioned to return to sustained profitability,” said Kellner on a conference call with reporters and analysts. “We think that, based on current market conditions, 2007 will be another big year for us.”
Continental reported a fourth quarter 2006 net loss of $26 million ($0.29 diluted loss per share), including a special charge of $22 million related to lump-sum payments to retiring pilots. Excluding the special charge, Continental recorded a net loss of $4 million ($0.04 diluted loss per share).
“In 2006, we grew revenue at almost twice the rate we grew capacity, and we grew mainline capacity more than any of the other major network carriers,” said Jeff Smisek, president of Continental.
Ray Neidl, an analyst with Calyon Securities, reportedly said, “It would have been better had they been able to eke out a profit like AMR. All legacy carriers need to be diligent about (controlling costs). On the revenue side, things look positive.”