United Airlines

United Airlines’ fourth-quarter profit beat analysts’ estimates and a key revenue metric outperformed the company’s initial guidance due to stronger close-in bookings and yields in November and December.

United on Tuesday reported that net income fell 52% in the fourth quarter to $397 million down from $823 million during the same period a year earlier, when lower fuel prices helped spur profits.

But earnings per share of $1.78 topped Wall Street’s estimates of $1.65. The airline also posted $9.1 billion in total revenue during the December quarter β€” up 0.2% from the same period in 2015.

The decline in profit reflected the $487 million in income tax United paid during the quarter, up from $82 million during the same period in 2015. For the year, United profits fell to $2.3 billion from $7.3 billion in 2015, reflecting a $1.6 billion tax burden as opposed to a $3.1 billion tax benefit in 2015.

The key revenue metric β€” passenger revenue per available seat mile or unit revenue β€” showed a 1.6% decline but that outperformed the company’s initial guidance. For the full-year 2016, unit revenue fell 5.4% due to the strong U.S. dollar, lower surcharges, reduced energy-related corporate travel, and declining yields.

“We saw meaningful improvement in the pricing and demand environment in the quarter,” United President Scott Kirby said in a news release. “Looking forward, we anticipate first-quarter consolidated unit revenues to be approximately flat, marking the fourth straight quarter of sequential quarter-over-quarter improvement.”

Other airlines, including Delta and American, have recently reported an improved outlook for unit revenue. The metric had been in negative territory for the U.S. airline industry in general since mid-2015 amid fare cuts and a stronger dollar.

United also reported that total operating expense rose 1.2% to $8.0 billion in the fourth quarter, but consolidated unit cost decreased 0.8%, due mainly to lower fuel expense.

“I am very pleased with core cost performance achieved in the fourth quarter and full-year 2016 where we kept non-fuel cost growth excluding new labor deals nearly constant,” CFO Andrew Levy said.

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