Operating performance has been more consistent than those of other peer U.S. "legacy airlines," reflecting productivity due to more flexible work rules, positive labor relations, and a modern, fuel-efficient aircraft fleet. Participation in the cyclical, capital-intensive, and price-competitive airline industry; Heavy debt and lease burden and weak balance sheet, following substantial capital expenditures and losses since late 2007; and Somewhat limited financial flexibility, with no general committed bank revolving credit and few unencumbered assets for sale, secured borrowing, or sale-leasebacks. The ratings on Houston, Texas-based Continental Airlines Inc. reflect its participation in the high-risk airline industry and a heavy debt and lease burden, but also a better-than-average operating performance among its peer large U.S. hub-and-spoke airlines. Continental posted a pretax
