United expects revenue and cash improvements in Q2

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United Airlines expects an improvement in revenue and its cash position as its all-in cost of fuel and capacity shrank during the second quarter, according to an investor update.

Passenger revenue per available seat mile (PRASM) is expected to increase by between 2.5% and 3.5% during the period, the airline reports.

United also predicts an improved cash position of $8.1 billion in unrestricted liquidity at the end of June compared to $7.8 billion at the end of the first quarter.

The Chicago-based airline expects that its consolidated fuel price will be $3.29 per gallon in the second quarter, which is down from $3.34 in the first quarter but up from $3.11 during the same period in 2011.

In comparison, Delta expects that it will pay $3.37 per gallon for fuel in the second quarter due to fuel hedges.

United expects that capacity, which is measured by available seat miles (ASM), will decrease by 0.6% to 64.6 million as a result of a 1.2% decline in domestic ASM.