Lucky Or Smart, Gordon Bethune Has Continental Climbing

Gordon M. Bethune, chief executive of Continental Airlines Inc., knows how it feels to be down. He recalls a day in January, 1995, when Continental was so strapped for cash that it asked Boeing Co. to wire-transfer nearly $30 million in aircraft deposits that Boeing had agreed to return. The mail would take too long.

These days, though, Bethune is relishing a lofty vantage point. Continental has posted record profits for the last four quarters, built a $650 million cash cushion, and climbed from worst to nearly first in rankings for on-time performance and baggage handling. Not bad for a company that twice filed for bankruptcy. True, many airlines are flying high, thanks to a healthy economy and higher fares. But Continental's first-quarter margins were among the industry's best. For the year, PaineWebber Inc. analyst Samuel C. Buttrick expects Continental's earnings to double, to $390 million, on about $6.3 billion in revenue, up roughly 9%. The stock, in the mid-teens when Bethune took over a year and a half ago, is now trading at about 55 (chart, page 76).