CHICAGO (Reuters) – United Airlines Holdings Inc (UAL.O) 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 Co (BA.N) said on Tuesday it does not expect to win approval for the return of the 737 MAX to service until mid-year, later than previously forecast.

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 to $13.

Total operating revenue rose 3.8% 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 succeed Munoz as CEO later this year.

Major U.S. airlines are benefiting from strong leisure and corporate travel demand, a trend that looked set to continue in the first quarter.

Revenue per mile flown, a closely watched industry measurement, rose 0.8% in the fourth quarter and United forecast similar growth in the first quarter.

However, unit costs excluding fuel and profit-sharing expenses, a concern for investors in a year of contract negotiations with pilots, rose 2.7%.

The company had already announced a non-cash impairment charge of $90 million in the fourth quarter related to its Hong Kong routes, following anti-government protests in the city.

It did not comment in the earnings release on the potential impact of the Wuhan coronavirus in China, which J.P.Morgan analyst Jamie Baker said poses a near-term overhang for airlines.

Shares of United closed 4.4% lower at $85.79 before the earnings release, tracking sharp declines for U.S. airline and travel stocks on concerns that the virus will spread.

Separately, United said there is no impact on its operations from the outbreak and that it remains in close contact with U.S., Asian and Chinese authorities on safety.

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.

United management will host a conference call to discuss results on Wednesday at 10:30 a.m. EST (1630 GMT).

Fellow U.S. MAX operators Southwest Airlines Co (LUV.N) and American Airlines Group Inc (AAL.O) are due to report quarterly results on Thursday.

The three airlines are scheduling without the MAX until early June though that timeline will likely need to be pushed back following Tuesday’s guidance from Boeing.

Reporting by Tracy Rucinski in Chicago; Additional reporting by Dominic Roshan K L in Bengaluru; Editing by Matthew Lewis

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