Delta posts $2.1 billion 1st quarter net loss

Delta posts $2.1 billion 1st quarter net loss    Bankrupt Delta Airlines Thursday reported a first quarter net loss of $2.1 billion, compared to a net deficit of $1.1 billion in the prior year quarter.
   The quarterly net loss included a $1.4 billion charge relating to reorganization items and a $310 million net charge for three accounting adjustments. Excluding the reorganization and special items, Delta’s first quarter net loss was $356 million, compared to a net loss of $684 million in the first quarter 2005, also minus special items.
   The Atlanta-based airline posted a first quarter operating loss of $485 million, an improvement over the $957 million operating deficit recorded in the same quarter last year.
   Operating revenue was down 2.9 percent to $2.57 billion from $2.65 billion. Cargo revenue slumped 6.8 percent to $123 million. The airline’s fuel costs in the quarter rose 5.1 percent to $929 million.
   “While continued losses clearly are unacceptable, Delta’s financial performance for the quarter was in line with expectations, especially in light of fast-rising fuel prices,” said Gerald Grinstein, Delta’s chief executive officer. “Despite these higher fuel costs, however, our company succeeded in reducing the first quarter operating loss by nearly 50 percent year-over-year — evidence that Delta’s plan is on track.”
   Last September, Delta filed a petition for reorganization under Chapter 11, under which the airline plans to lower costs by $3 billion a year by the end of 2007, on top of a previous cost-savings target of $5 billion a year by the end of 2006. The airline hopes to achieve the extra cost savings by improving revenue and network productivity, as well as cutting back on some 7,000 to 9,000 employees by the end of 2007.