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Continental soars in 1Q
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April 16, 1998: 2:12 p.m. ET
Airline credits more seating, traffic and cheap fuel as it flies over Street targets
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NEW YORK (CNNfn) - Continental Airlines Inc. reported record first-quarter profit Thursday and beat analyst estimates by 6 cents a share thanks to higher seating capacity, climbing revenue and lower fuel costs.
The Houston-based airline said first-quarter net income rose to $81 million, or $1.06 a diluted share, from $74 million, or 96 cents a diluted share, in the year-ago quarter.
The consensus analyst estimate, as compiled by First Call, was $1.00 a share.
Double-digit percentage gains in passenger traffic lifted first-quarter revenue 9 percent to $1.9 billion. Operating income rose 3 percent to $150 million, despite the federal excise tax on tickets throughout the first quarter.
Continental said first-quarter costs per available seat mile were down 1.4 percent due primarily to lower fuel costs.
The airline completed a $773 million debt offering in February, and the proceeds will pay for up to 24 new Boeing planes to be delivered through December this year.
"Continental is in solid financial shape. We're acquiring the right planes at the right price at the lowest interest rates in years," said Larry Kellner, executive vice president and chief financial officer.
The nation's fifth-largest airline, with 192 daily departures worldwide, continued international growth and expansion of hubs in Houston, Newark and Cleveland.
Shares of Continental (CAI.B) were off 1-3/16 at 62-1/2 in midday trading after a strong run-up in the quarter.
Northwest Airlines Corp. announced in January it would acquire a controlling stake in Continental. The two also signed a global strategic alliance including code-sharing and frequent flier reciprocity.
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Continental
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