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United tops profit forecasts even as Boeing 737 MAX crisis drags on

By Tracy Rucinski

By Tracy Rucinski

CHICAGO, Jan 21 (Reuters) - United Airlines Holdings Inc on Tuesday beat Wall Street estimates for quarterly profit and held to its 2020 profit target, with a turnaround strategy overseen by its outgoing CEO underpinning growth even as the Boeing 737 MAX remains grounded.

Chicago-based United is one of three U.S. airlines cancelling more than 1,000 monthly flights in a hit to profits as the 737 MAX remains grounded following two deadly crashes in Indonesia and Ethiopia. Boeing said on Tuesday it does not expect to win approval for the return of the 737 MAX to service until mid-year, longer than previously forecast.

United's adjusted net income rose to $676 million, or $2.67 per share, in the fourth quarter to Dec. 31, from $657 million a year earlier, topping a Wall Street consensus forecast for $2.65 per share.

While the airline has warned of a negative hit from the MAX grounding, it did not disclose any estimated financial impact from the fallout and stood by its full-year adjusted EPS range of $11 and $13.

Total operating revenue rose to $10.89 billion, boosted by Chief Executive Oscar Munoz's three-year strategy to build up the airline's flight connections through its main U.S. hubs. United President Scott Kirby will replace Munoz as CEO later this year.

Major U.S. airlines are benefitting from strong leisure and corporate travel demand, a trend that looked set to continue in the first quarter. (Reporting by Tracy Rucinski in Chicago Editing by Matthew Lewis)