CHICAGO ( TheStreet) -- United ( UAL - Get Report) reported a profit despite a $1.1 billion increase in fuel cost.

Excluding items, the carrier reported net income of $577 million, or $1.49 a share. Analysts surveyed by Thomson Reuters had estimated $1.43 a share. Revenue rose 10.3% to $9.8 billion. Analysts had estimated $9.7 billion.

United's gains came even though consolidated fuel expense, excluding the impact of hedges, increased by $1.1 billion over the previous year. Hedges produced a gain of $278 million.

With $39 million for special items including integration costs related to a merger with Continental, United earned $538 million, or $1.39 a share.

"We are well positioned to deliver on the once-in-a-lifetime opportunities that this merger presents," said CEO Jeff Smisek, in a prepared statement.

During the quarter, consolidated passenger revenue per available seat mile rose 9%. Mainline PRASM increased 9.1% as mainline capacity increased 1.1% over the previous year. Revenue decreased by about $100 million due to reduced demand related to the earthquake and tsunami in Japan.

Still, United reported PRASM gains in every region, ranging from 5.6% in the trans-Atlantic to 20.2% in Latin America. Atlantic capacity rose by 7.3% and Latin American capacity rose by 8.8%.

On the cost side, consolidated cost per available seat mile, excluding special items and fuel expense, rose 1.3%.

United ended the quarter with $8.6 billion in unrestricted cash and equivalents.

The profit at United, the second airline to report earnings, was expected and is likely to be replicated as others report later Thursday and next week.

American ( UAL - Get Report), which has higher labor costs and older aircraft, on Wednesday reported what is expected to be the only loss in the industry.

-- Written by Ted Reed in Charlotte, N.C.

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