Yesterday we announced our financial results for the second quarter. It was good news as we had a net profit for the first time in the second quarter since 2000. Our performance was the result of improvement in several important areas - revenue, margin, cash and costs.

Looking at the numbers, we reported a net income of 119 million dollars, an improvement of 145 million dollars over the second quarter of 2005.

On the cost side, our unit cost was 11.43 cents, up 9 percent as compared to the second quarter of 2005. Excluding fuel and other one time special items, our unit cost increased by 1.5 percent. On the revenue side, our unit revenue for the quarter was 12.03 cents, up 12 percent for the year. Both our revenue and cost results are competitive, but we are not yet producing industry leading margins. Therefore, we are accelerating our cost reduction efforts, working hard to bring a significant piece of the 400 million dollars in targeted 2007cost savings into 2006. Examples of areas targeted for savings include advertising, purchased services, general and administrative costs, and operational efficiency improvements.

From a revenue perspective, we are focused on strengthening our network and providing a superior customer experience to set ourselves apart from the industry.

We continue to optimize our route structure, improving our economic performance while broadening our customer offering in key hubs.

You saw evidence of that last Friday when we announced that we are shifting our Tokyo service from Kennedy to Washington Dulles, where we believe we will have higher yields as a result of tapping into our Washington hub. We are also selling rights to our New York-London route to Delta Airlines, eliminating a route that was unprofitable for United. These two moves will discontinue our international flying out of JFK, effective with the last flights on October 27.

While these changes will impact the type of flying from the JFK domicile, the overage caused by the changes in flying will not result in a surplus. We'll manage the overage by canceling plans to place new hires in JFK, processing transfers to other domiciles when appropriate, and through normal attrition.

These two market reductions will enable us to reintroduce non-stop service to Taipei from a point of strength, our San Francisco gateway. Over the next few months, Onboard will be determining the most cost effective way to staff the new San Francisco – Taipei service.

We are also expanding our San Francisco to Seoul service to seven days a week throughout the year and adding three more weekly seasonal flights from San Francisco-Hong Kong in the spring of next year.

Over the next nine months, these changes will add more than 40 flights per week to our schedule between the U.S. and Asia .

Two weeks ago I did a great deal of traveling in the Pacific, visiting our domiciles in Seattle , Narita and Hong Kong . I want to thank the flight attendant crews on all of my flights. They were very professional and focused on providing our customers with an exceptional travel experience in this very important market. I was also delighted to be on hand to celebrate Seattle-based flight attendant Sherry Masser's 40 th anniversary with United. She marked the occasion by doing what she does best – taking excellent care of our customers. Thank you, Serry, and happy anniversary!

In closing, no matter what domicile I'm visiting, my discussions with flight attendants center on what we need to do to improve the customer experience. It is critical that we consistently deliver the basics, and we have a great deal of work to do. You've told me of your frustration with catering, especially at our domestic locations. You shared repeated incidents of galleys that are boarded late and often missing items essential for the service. Bill Dove, our director of worldwide catering, and I are meeting with the president of Gate Gourmet, our largest caterer this week. We are going to discuss the actions necessary for Gate Gourmet to improve their performance. I will keep everyone updated on the progress we expect to see.

As always, thanks for the work that you do, especially during this very busy summer season. That's all for today. Fly safely and continue taking good care of our customers.