United Airlines expects profit margin in lower range of outlook

The Chicago-based airline said it expects a pretax margin of 12 to 13 percent for the quarter ended June 30. Its prior forecast was for a pretax margin of 12 to 14 percent.

It said its quarterly capacity grew some 2.3 percent from a year earlier, in the lower range of earlier guidance of 2.25 to 3.25 percent growth. Investors have called on U.S. airlines to taper their capacity growth to match weaker demand.

United said it expects passenger revenue per available seat mile, which measures sales relative to the capacity and distance of flights, to have fallen between 5.25 percent and 5.75 percent year-over-year, within the range of the prior outlook.

The carrier said it expects gross capital expenditures were higher than it previously forecast for the quarter because of a change in timing of aircraft-related deposits. It now expects to have spent between $1.24 billion and $1.26 billion, up from prior guidance of $885 million to $905 million.

It said it had $5 billion in unrestricted cash and short-term investments at the end of the second quarter.

(Reporting by Jeffrey Dastin in New York; Editing by David Gregorio and Matthew Lewis)