Delta posts a whopping loss as fuel costs bite

04/23/2008

ATLANTA - Delta Air Lines, the nation’s third-largest carrier, says its loss widened in the first quarter to a whopping $6.39 billion due to soaring fuel prices and the steep decline in the company’s market value.

The results badly missed Wall Street expectations, despite a 12 percent increase in sales.

The Atlanta-based company said Wednesday 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 expected a loss of 49 cents a share, excluding one-time items.

Separately, Northwest Airlines, which agreed last week to combine with Delta to create the world’s largest carrier, also reported a large loss Wednesday.

Northwest said its loss deepened to $4.14 billion in the first quarter, mostly because of a big charge.

The Eagan, Minnesota-based carrier says it lost $15.78 per share. That includes a $3.9 billion charge related to rising fuel prices and the company’s declining share price. It lost $292 million, or $3.34 per share, a year earlier.

Sales rose to $3.13 billion from $2.87 billion.

Thomson Financial says analysts predicted Northwest would lose 30 cents per share on revenue of $3.13 billion.