Delta reports $6.4B loss on fuel costs
ATLANTA (AP) - April 23, 2008 The results badly missed Wall Street expectations, despite a 12
percent increase in sales.
The Atlanta-based company said the loss is equivalent to $16.15
a share. That compares with a loss of $130 million that Delta
reported in the year-ago January-March quarter, when it was still
in bankruptcy.
Excluding special items, primarily a $6.1 billion non-cash
charge relating to the decline in Delta's market value due to
sustained record fuel prices, the airline lost $274 million, or 69
cents a share, in the first quarter.
Analysts were expecting a Delta loss of 49 cents a share,
excluding one-time items.
Revenue in the quarter rose to $4.77 billion, compared with
$4.24 billion recorded in the same period a year ago. Delta shares
rose 10 cents in premarket trading to $6.90, just off a 52-week low
of $6.70.
Delta said its first-quarter loss before special items was
driven by a $585 million year-over-year increase in the cost of
fuel.
Delta's shares have fallen nearly 69 percent since the airline
emerged from Chapter 11 on April 30, 2007.
Delta announced April 14 that it has agreed to acquire Northwest
Airlines Corp. in a stock-swap deal that, if approved by regulators
and shareholders, would create the world's largest airline.
Northwest was also scheduled to release first-quarter results
Wednesday.
"Our need to respond to the pressures of dramatically rising
fuel costs and a softening U.S. economy drove us to take a closer
look at all options to protect Delta's future," Chief Executive
Richard Anderson said in a statement. "The merger with Northwest
will create an airline with the size, scale and global presence to
weather economic downturns and compete long-term in the global
marketplace."
Gas and oil prices pushed further into record high territory
Tuesday, with retail gas reaching a national average of $3.51 for
the first time and crude nearing $120.
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On the Net:
Delta Air Lines Inc.: http://www.delta.com
