U.S. News

Delta Air Lines Reports Fourth-Quarter Loss of $2 Billion


Delta Air Lines, which is operating under bankruptcy protection, on Wednesday reported a wider fourth-quarter loss of nearly $2 billion because of hefty restructuring items.

The Atlanta-based company said it lost $1.98 billion for the three months ending Dec. 31, compared to a loss of $1.24 billion a year ago.

Revenue rose 5.3 percent to $4.14 billion from $3.93 billion in the same period a year ago.

Excluding reorganization and other one-time items, the loss was $179 million.

Delta's chief financial officer, Ed Bastian, said in a memo to employees Wednesday that the nation's third-largest carrier is making improvements, including cutting costs.

"Our financial improvements have one important common theme -- they would not have been possible without the efforts of all Delta employees," Bastian wrote.

Delta said its aircraft fuel costs fell 8.2% to $1.04 billion in the fourth quarter, compared to $1.13 billion a year earlier.

As of Dec. 31, Delta said it had $2.6 billion in unrestricted cash on hand.

Earlier Wednesday, Delta said it lost $1.84 billion in December alone.

The huge loss for the final month of 2006, which amounted to $9.34 a share, was reported in a bankruptcy court filing.

Excluding reorganization items, Delta said it lost $109 million in December.

Revenue for the 31-day period was $1.34 billion.

For all of 2006, Delta said its net loss was $6.21 billion, compared to a loss of $3.84 billion for the same period a year ago. The loss for 2006 includes stock dividends that accrued for preferred shareholders.

Annual revenue rose to $17.17 billion, a 6.1 percent increase from $16.19 billion in 2005.

The loss for 2006 raises Delta's losses to $18.5 billion since January 2001.

Delta said it spent $4.32 billion on aircraft fuel for all of 2006, a 1.1% increase from the $4.27 billion it spent for all of the previous year.

Delta hopes to emerge from bankruptcy as early as April as a standalone carrier with a projected value of $9.4 billion to $12 billion.

"Although we are well on our way to exiting bankruptcy, there is still work left to do as we stay focused on delivering our standalone plan," Bastian said in his memo to employees. "We are clearly doing a lot right, and our goal is now in sight -- goal you've worked hard to realize; a goal whose rewards you deserve.