NEW YORK — United Airlines parent UAL Corp. said it will record $2.6-billion to $2.7-billion in accounting charges in the second quarter, according to a regulatory filing Friday.
The largest chunk is a non-cash impairment charge of between $2.2-billion and $2.3-billion. UAL said in the filing it is writing off the “entire value of goodwill on its books,” but company officials weren't available to elaborate.
UAL also expects to record non-cash charges of $246-million related to Boeing 737s that are being cut from the company's fleet.
The Chicago-based company said it will take $82-million in charges related to job cuts, and $60-million in charges related to certain unspecified projects that have been stopped or delayed.
UAL said it expects to take additional accounting charges in future quarters related to capacity reductions and an increase in certain employee benefits, but said it does not yet know the amount or timing of the charges.
United Airlines, the second-largest U.S. carrier, has announced plans to cut about 2,550 jobs, including 950 pilots and 1,600 salaried positions. The company also plans to slash capacity and reduce its fleet size in the face of soaring fuel prices.
Source:http://www.theglobeandmail.com/servlet/story/RTGAM.20080711.wual0711/BNStory/Business/