CARGOTREND

> TAKING THE PULSE: The fourth-quarter reporting season for the airline 
> industry will be dominated by commentary on the outlook for air travel 
> demand as well as the future of AMR Corp. (AAMRQ). The parent of American 
> Airlines filed for bankruptcy protection late last year after months of 
> speculation that Chapter 11 was on the horizon for the struggling company. 
> Focus has now turned to potential suitors for AMR, which won't report 
> results for the period.
>
> Headwinds for carriers in the December quarter included fuel prices that 
> have crept up again in recent months and softer demand for air travel, 
> notably on trans-Atlantic and trans-Pacific routes.
>
>
> COMPANIES TO WATCH:
>
> Southwest Airlines Co. (LUV) -- Reports Jan. 19
>
> Wall Street Expectations: Analysts polled by Thomson Reuters expect a 
> per-share profit of 8 cents on $4.12 billion in revenue. Southwest a year 
> earlier reported a per-share profit of 18 cents--15 cents excluding 
> one-time items--on $3.11 billion in revenue.
>
> Key Issues: The largest hauler of domestic passengers predicted "solid" 
> fourth-quarter growth in unit revenue--the amount taken in for each 
> passenger flown a mile--yet analysts at Dahlman Rose note Southwest's 
> growth in the closely watched metric has lagged behind peers in recent 
> months. Meanwhile, the integration of fellow discounter AirTran Airways 
> remains of interest, particularly any update on plans to connect the two 
> carriers' networks in the first half of the year.
>
>
> Delta Air Lines Inc. (DAL) -- Reports Jan. 25
>
> Wall Street Expectations: Analysts expect earnings of 38 cents a share on 
> $8.31 billion in revenue. Delta last year reported earnings of 2 cents a 
> share--19 cents excluding one-time items--on $7.79 billion in revenue.
>
> Key Issues: Delta's initial interest in picking up all or part of AMR will 
> likely dominate its conference call with analysts, alongside commentary on 
> demand to Europe and Asia. The nation's No. 2 carrier by traffic has said 
> it expected strong air travel demand, particularly from business fliers, 
> to continue in the December quarter. Delta also has been among the more 
> aggressive in trimming capacity to reduce costs and match demand, noting 
> at an investor day last month that it expected to cut capacity by 4% to 5% 
> in the fourth quarter.
>
>
> US Airways Group Inc. (LCC) -- Reports Jan. 25
>
> Wall Street Expectations: Analysts expect the company to break even on a 
> per-share basis, with $3.14 billion in revenue. The company last year 
> reported earnings of 17 cents a share on $2.91 billion in revenue.
>
> Key Issues: The nation's fifth-largest airline by traffic could miss out 
> on the next round of consolidation, overshadowing a streak of double-digit 
> unit revenue jumps in the fourth quarter that cheered analysts. US 
> Airways, itself the product of the 2005 merger of US Airways and America 
> West Airlines, has been seen as one potential suitor for AMR, though any 
> pairing would face massive integration issues, particularly with labor 
> groups.
>
>
> United Continental Holdings Inc. (UAL) -- Reports Jan. 26
>
> Wall Street Expectations: Analysts expect earnings of 13 cents a share on 
> $8.94 billion in revenue. The company last year reported a loss of $1.01 a 
> share on $8.43 billion in revenue. Excluding costs related to the October 
> 2010 merger of United and Continental, the company reported a profit of 44 
> cents a share.
>
> Key Issues: The massive task of integrating the United and Continental 
> businesses continues to be in focus for investors in the airline, now the 
> world's largest by traffic. The airline recently secured a tentative new 
> labor deal with the union representing United flight attendants, but a 
> fresh pact with pilots remains problematic. Meanwhile, a fourth-quarter 
> financial update offered last month by the carrier disappointed some 
> analysts, particularly its report that costs could top previous estimates 
> and a key revenue metric could show its slowest growth of the year. "UAL's 
> overall revenue performance is still decent, but lags peers somewhat," 
> analysts at Rodman & Renshaw wrote in response.