One Step Forward, One Step Back(?)

Fresh out of bankruptcy and helped by high ticket prices, UAL -- the parent of United Airlines -- posted a third-quarter net income of $190 million. The news wasn't as rosy for Northwest Airlines, however... which continued to lose money as it works to exit Chapter 11.

According to TheStreet.com, United posted net income equalling $1.30 a share, on revenue of $5.2 billion. That's an increase of 11 percent compared to last year... but was less than many analysts had predicted.

United CFO Jack Brace told reporters the news would have been brighter had the airline not sent aside 43 cents per share for income taxes. The airline added it showed a year-over-year $95 million improvement in net income after special items.

United CEO Glenn Tilton attributed the gains to continued cost-saving measures at the second-largest US carrier.

"One of the things we get to do, post-exit [is] to involve all of our employees in activity that is much more relevant to them, in identifying and realizing cost-saving initiatives," he said. "If we can improve the customer experience, improve employee engagement, and simultaneously improve our costs, I think we're going to ring the potential out of this company that has always been here."

Meanwhile, over at Northwest Airlines the story wasn't quite as rosy. It would have been much better, though, if the carrier weren't still mired in bankruptcy reorganization.

Northwest reports it generated a net profit of $252 million. That's a far, and welcome, cry from a year ago at this time -- when the carrier lost $234 million.

However, due to special items and bankruptcy costs, the carrier still recorded a staggering net loss of $1.2 billion for the quarter, due in large part to losses in September. The carrier lost $337 million in that month alone, as nervous fliers tended to stay home following the August discovery of a terror plot in London targeting airliners, and subsequent security restrictions.

And it would have been worse, had ticket prices not overcome increased fuel costs.

"Our third-quarter results are a significant improvement over last year's results and demonstrate further that we are making steady progress in restructuring Northwest Airlines," said CEO Doug Steenland in a prepared statement. "However, our September loss indicates that we still have work to do in order to reach our goal of sustained profitability."

Northwest stressed its earlier prediction the carrier would report a loss -- this time, excluding reorg costs -- for the last four months of the year. Overall, however, the carrier said it expects a modest 2 percent profit for the year overall.

Aviation consultant Mike Boyd told TheStreet.com Northwest is "on track."

"They have a clear vision of what they want to do," Boyd said. "They understand that their service from China will dump people in Detroit, and that those people will travel all over the system after that. They will also have the (Boeing) 787 years before anyone else."

FMI: www.united.com, www.nwa.com