U.S. airliners delivered Q1 profits of $401M, compared to a loss of $553M a year ago.
JetBlue (JBLU +0.8%) and United Continental (UAL -1.5%) were the only carriers not to improve their profitability from last year. If UAL's results are backed out, the group (ALK, ALGT, AAL, DAL, HA, LUV, SAVE) saw a profit gain of over $1B for the period.
Improving business demand and solid pricing trends (fares, bags) have helped lift the sector.
Shares of United Continental (UAL +2.5%) are outperforming again within the sector and topping broad market averages.
UAL is now up close to 9% over the last week and appear to closing in on reaching $50 a share for the first time since 2007.
The general outlook by analysts on UAL is that there is solid upside for the carrier to improve its PRASM metric which should feed into EPS growth. SA contributor Stone Fox Capital was ahead of the curve with its call.
IATA revises its outlook for airline industry profit to $18.7B, lower than a previous forecast calling for $19.7B in profits.
The agency cites higher oil prices and a lack of international alignment of passenger rights as factors in the downward revision.
Cargo demand is forecast to improve 4% in 2014.
By region, North America is expect to see carriers generate the sweetest margins. The anticipated profit of $8.6B by North American airliners is more than double what counterparts in Europe will earn this year, says IATA.
Airlines have cancelled over 500 flights for today as the freezing weather continues relentlessly. The latest storm has dumped snow on the Midwest and is expected to be similarly beneficent to the Northeast and mid-Atlantic states.
The latest cancellations add to 1,379 flights that were scrubbed for the President's Day holiday yesterday and over 4,440 that were delayed. More than 7,500 flights were scrapped on February 13.