DAL posts Q4 loss of $2,200,000,000

[eggman76]

According to Delta's website they carried approximately 26 millionpeople in Q4 of 2004. This math works out to a loss of $84 perticket sold. Story follows.



Delta reported a fourth-quarter net loss of $2.2 billion, or $16.58 pershare, wider than a loss of $327 million, or $2.69 per share, lastyear. Operating revenue rose 0.9 percent to $3.6 billion.Excluding items that resulted in a $1.4 billion charge, including a$1.9 billion impairment of its holdings in Atlantic Southeast Airlinesand Comair, the Atlanta air carrier said its fourth-quarter loss was$780 million, or $5.88 per share.


The airline cited higher fuel costs and declining domestic yields in the "disappointing" quarter.

Fuel expenses surged 75.5 percent, or $385 million, withapproximately 94 percent of the increase resulting from higher fuelprices.

Continued weak domestic yields, down 7.7 percent as compared to theprior-year quarter, drove the decline in passenger unit revenue, whichfell 5.6 percent.

Delta estimates that its funding obligation in 2005 for its definedbenefit pension and defined contribution plans will be approximately$400 million to $450 million.

It sees unit costs ex-mainline fuel and unusual items falling 10percent in the first quarter and capacity rising 6 percent to 8 percent.

 

[DAS at 10/250]

Operating revenue rose 0.9 percent to $3.6 billion. Excluding items that resulted in a $1.4 billion charge, including a $1.9 billion impairment of its holdings in Atlantic Southeast Airlines and Comair, the Atlanta air carrier said its fourth-quarter loss was $780 million, or $5.88 per share.

So, with all the pilot pay concessions and even if the price of oil was not up, then DAL still would have lost $395 million. ($780 m loss - $385 m fuel increase)

Just what is going on over there? What exactly is the problem?

 

[VampyreGTX]

I wonder how big a bonus the execs. will get?

 

[Big Duke Six]

I'm sure that in view of these losses, their bonuses will have to be limited to just twice the level of last year's bonuses. How will they get by?

 

[~~~^~~~]

What does a "1.9 Billion impairment in holdings of ASA & Comair mean?"

 

[MDPilot]

It means the DAL has written down the value of ASA/COMAIR by 1.9B. After factoring in the original purchase price of both, I believe that means that DAL is saying that ASA/COMAIR has essentially zero monetary value to the corporation. Any gains at all by selling them off would be positive from this point forward. If both were shutdown tomorrow, there would be zero losses realized.

 

[ATR-DRIVR]

Zero losses realized???? Are you kidding? So ifASA/CMR were "gone tomorrow" as you put it, there would not be anylosses at all? Tell me how would all the passengers we feed DALfrom all over, and the people who buy a ticket to say EYW and othersplaces get to where they are going?

 

[MDPilot]

You are misinterpreting what I wrote. We're speaking from a corporate fiscal standpoint. If an asset is written down to zero book value, and you throw it out in the trash the next day, you have affected the corporate fiscal value not at all. If you are able to get 10M dollars for that "zero" value asset, you just made a 10M dollar profit.

 

[DAS at 10/250]

ATR-DRIVR Relax.

If both were shutdown tomorrow, there would be zero losses realized.Today 09:41

It just means that on the books the loss has already been taken. The amortization ended this year and a sell or shut down next fiscal year would not incur a penalty on DAL's sheet.

Sorry, MDPilot posted before I could hit submit.

 

[fastandlow]

You are misinterpreting what I wrote. We're speaking from a corporate fiscal standpoint. If an asset is written down to zero book value, and you throw it out in the trash the next day, you have affected the corporate fiscal value not at all. If you are able to get 10M dollars for that "zero" value asset, you just made a 10M dollar profit.

Why is it that financial accounting confuses me but I understand imaginary numbers?!

 

[C601]

ATR-, Dont shoot the messenger, MDPilot makes perfect sence on the above article.

 

[PacoPollo]

Zero losses realized???? Are you kidding? So ifASA/CMR were "gone tomorrow" as you put it, there would not be anylosses at all? Tell me how would all the passengers we feed DALfrom all over, and the people who buy a ticket to say EYW and othersplaces get to where they are going?

......Sh*takua,Gulfstream, mesa etc.....