Hello, it's Glenn, and it's the 27th of January, a Friday, and I am calling from Chicago.

Today, we reported our financial results for the 4th Quarter and the full year 2005, and I have asked Dave Wing, our vice president and controller, to join me on the call to discuss our announcement.

It is important to look at our operating earnings as the best measure of our performance and, in every year of our restructuring, operating earnings have steadily improved at United.

We are reporting an operating loss for 2005 of $219 million, which is an improvement over 2004 of well over $600 million, in spite of the fact that system fuel costs were almost one and a half billion dollars more this year than they were last year.

The result was driven by a $1 billion increase in revenue this year and a $1 billion reduction in non-fuel costs.

A very dramatic story.

United's cost per available seat mile, or CASM, excluding fuel is down 7 percent year over year, despite a capacity reduction of 4 percent, competitive with peers.

Our revenue, or passenger revenue per available seat mile (PRASM), increased 12 percent, outpacing the industry average by a full percent.

So now I'll ask Dave to give us more detail behind the numbers that we're reporting, and, importantly, to explain to all of you how the company must account for restructuring charges as we prepare for our exit from Chapter 11 in the days ahead.

Dave, the call's over to you…

DAVE

Thanks, Glenn…

Today's financial results do show real improvement for both revenues and our non-fuel operating expenses.

The company's revenues grew by 10% in the fourth quarter and 6% for the full year. Revenues in all periods were improved by growth in the total mainline and United Express flying, as well as growth in our airline-related businesses.

For mainline passenger revenues, yield was about 8% better in the fourth quarter, with flat traffic.

Annual revenues in total improved about $1 billion in 2005, even though both capacity and traffic declined between periods.

Operating expenses other than fuel also declined by $1 billion year-over-year.

Our cost per available seat mile, excluding fuel and special items, was down about 7% for the fourth quarter and down 5% for the full year, which is significant considering that capacity was down by about 4% in both periods.

Now, even with substantially increased cost of fuel factored into our results, which added about $1.4 billion to our total operating expenses year over year, United still produced better operating results of almost $400 million in the fourth quarter and over $600 million for the full year. This improvement is very promising, but improved margins are still the goal in 2006.

I want to take a few minutes now to discuss the reorganization expenses that are included in this morning's earnings announcement, because I know they can be confusing.  Before I walk you through them, though, let me provide a little bit of context.

First, it is important to remember that all businesses operate under a set of accounting guidelines called Generally Accepted Accounting Principles, or GAAP, and those dictate how we account for our business in our financial statements.   The reorganization expenses that appear in our earnings for the quarter and the full year are there because GAAP requires them, but these charges are non-cash charges, and they have little actual impact on our core business or on our cash position.

We recorded reorganization expenses of $17 billion for the fourth quarter and $21 billion for the full year.  These expenses reflect claims allowed against the company from our creditors as part of the restructuring process. In order to conform with the rules of GAAP, we have to record the full claim amounts as reorganization expenses now, even though these claims are expected to be settled to just a minor fraction of the claims recorded – and in most cases that will be for stock in the new company and not in cash.

So, based on this accounting, we expect to record a large reorganization gain in our earnings next quarter, the first quarter of 2006.  We do that to reflect the fact that we actually will settle these claims for a minor fraction of the claim amounts recorded.

So, these very large reorganization items create quite a significant loss for this quarter and a large gain in the first quarter of 2006.  But remember, in both cases, the actual impact on our cash position is minimal.

And that's why, as Glenn said, it's important to look at our operating earnings, which are not affected by these restructuring charges, as a better measure of the company's performance.

As a final point, our cash position remains strong with an unrestricted cash balance of about $1.8 billion as of the end of December and restricted cash of another $1 billion as of year-end.  As the company has announced previously, favorable exit financing has been arranged and at the time of our exit, our debtor-in-possession financing will be repaid and replaced with the new exit facility.

Back to you, Glenn.

GLENN

Thanks very much, Dave.

One of the things that I'm sure both Dave and I will look forward to in the future is reporting quarterly results without the complexity of explaining restructuring charges.

As Dave said a moment ago, our cash position is strong, we have our exit financing arranged and our margin improvements reflect the effectiveness of enhanced revenue management and cost containment.

These results set us on track for the year ahead.  We will push forward and build on this momentum, knowing there is much to be gained simply in improving our execution, and our continuous improvement initiatives all throughout the company. 

That's all for now.  I will be talking to you again soon.  Until then, stay focused on our customers and on one another, as one company, and stay united.