A more than 50% drop in United’s third quarter fuel costs helped the U.S. legacy carrier record a small operating profit for the three-month period despite a 20.3% dip in revenue to $4.4 billion.

The $88 million operating profit combined with a 50% drop in other one-time charges limited the carrier’s quarterly net loss to $57 million, a significant improvement on the near $800 million net loss posted in the same period last year. At the same time, United bolstered its liquidity to $2.8 billion, and on Sept. 30 held more than $2.5 billion in unrestricted cash.

Part of the dip in revenue was attributed to a 5.7% reduction in United’s consolidated capacity (which included an 8.2% drop in mainline available seat miles), although a 17.1% decline in yield also hurt United’s third quarter performance, particularly in its mainline operations, which posted a 23.7%, or roughly $1 billion drop in sales to $3.3 billion.

Regional revenue at the same time grew 1.2%, or $10 million, to $844 million on 15.3% more capacity; cargo sales dipped $94 million to $125 million.

Costs, meanwhile, fell 28.3%, or $1.7 billion to a little less than $4.4 billion, although $1.4 billion of this is due to the year-on-year reduction in United’s fuel expense line item. However, a fleet and staff reduction plan and tighter cost control also produced savings for United, and excluding fuel other accounting charges third quarter mainline unit costs fell 1.6%.

“Against a challenging environment, our people are delivering improvements across the business. With the work we have done and the strength of our network, we are poised to see better year-over-year unit revenue performance as economies begin to recover and business travel returns,” said Chairman, President and CEO Glenn Tilton in a release.

“We are again demonstrating that we can improve customer satisfaction and on-time performance even while reducing our unit costs.”

The carrier also noted that the 14.7% decline in passenger unit revenue recorded in the third quarter was a 2.5 percentage point improvement on the 17.2% dip posted in the previous three month period.

“We have made significant progress relative to last year, reporting an operating profit of $123 million excluding charges, and generating what we believe will again be leading cost control among our peers, reducing our mainline unit costs even as we reduce capacity,” noted CFO Kathryn Mikells.

“We continue to take action to improve our liquidity, and after successfully executing about $1.5 billion in transactions over the last four months, our unrestricted cash balance today stands at more than $3.1 billion, with only about $90 million in debt payments remaining this year.”

Photo: Airbus