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United Continental Holdings Inc.’s (UAL - Analyst Report) airline traffic – measured in revenue passenger miles or RPMs, which implies revenue generated per mile per passenger – fell 0.8% year over year to 17.94 billion in May 2013. Consolidated capacity (or available seat miles/ASMs) for the month was 21.25 billion, down 1.7% from May 2012.

The load factor (percentage of seats filled by passengers) improved to 84.4% from 83.6% in the same month, last year. Passenger revenue per available seat mile (PRASM) is estimated to have remained flat to down 1.0% year over year. The company registered a completion factor of 99.4%, with nearly 79.7% of the flights on schedule.

For the first five months of this year, United Continental generated RPMs of 81.00 billion (down 1.6% year over year) and ASMs of 98.83 billion (down 3.8% year over year). Load factor was 82.0%, reflecting a decline of 180 basis points.

Disappointing domestic business along with a drop in activities in the Atlantic and Pacific regions bruised the performance of the company during the month, offsetting the busy traffic in Latin America. Additionally, other risk factors such as fuel price instability, high non-fuel expenses and sluggish economic conditions also remain detrimental to United’s prospects.

Despite these headwinds, United is making continued progress on route expansion, fleet restructuring and introduction of new products and services for customers. The company launched a new baggage delivery system, installed satellite-based Wi-Fi service on all long-haul international flights and introduced the Premier Access program for the convenience of passengers.

United also resumed its international service on The Boeing Company’s (BA - Analyst Report) 787 Dreamliner with flights between Denver and Tokyo. This will not only enhance the company’s connectivity with the Asian belt but will also strengthen its position in the eastern part of the globe.

United Continental – that operates other industry players such as Delta Airlines (DAL - Analyst Report) and Southwest Airlines Co. (LUV - Analyst Report) – currently retains a Zacks Rank #3 (Hold).

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