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Delta’s Net Loss Increases

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Delta has reported its financial results for the quarter ended June 20,2005. These include a net loss of $382 million, or $2.64 per share compared to $2.0 billion, or $15.79 per share a year ago.

The company reported operating loss of $129 million for the quarter, and an increase in operating revenues of 5.7%. Delta said that passenger unit revenues increased 1.2% from the prior year.

Delta's Net Loss Increases

“Delta’s second quarter results reflect both the solid progress we are making in implementation of our transformation plan, and the substantial challenges we are facing,” said Delta CEO Gerald Grinstein.

“As part of our companywide focus on reducing costs and increasing revenue, we have pursued a wide range of initiatives, including fuel conservation measures, debt-for-equity exchanges, implementation of a new revenue management system, surcharges on many of our trans-Atlantic flights and additional significant fare initiatives, among many others,” added Grinstein. “Improvements in unit costs, passenger revenue and revenue per available seat mile are proof that these efforts are working.”

Fuel prices obviously put a hurt on the numbers, resulting in operating expenses increasing 2.7% from the prior year quarter. Some cots did decrease, however, such as consolidated system unit costs and mainline unit costs.

“Record-high fuel prices and other factors out of our control during the quarter outpaced our transformation initiatives and masked our progress,” said Grinstein. “Our management team recognizes that further change is essential — and it must be implemented with even greater speed — if we are to achieve our goals in the increasingly competitive aviation marketplace.”

“I am confident everyone at Delta will rise to the challenge as we strive to improve our competitive and financial positions, while continuing to provide the travel experience our customers expect,” Grinstein concluded.

Delta reported that at the end of the quarter it had $2.0 billion in cash and cash equivalents and short-term investments, of which $1.7 billion was unrestricted.

Chris is a staff writer for WebProNews. Visit WebProNews for the latest ebusiness news.

Delta’s Net Loss Increases
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