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Northwest beats 3Q target
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October 25, 2001: 10:53 a.m. ET
Operating loss is less than expected, but federal grant results in net profit.
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NEW YORK (CNNmoney) - Northwest Airlines reported a much smaller-than-expected third-quarter operating loss Thursday, and a federal grant following the Sept. 11 terrorist attack left the carrier with a net profit.
The nation's fourth-largest air carrier lost $100 million, or $1.18 a share, in the quarter, excluding special charges related to the attack and the $249 million of federal assistance it received. Analysts surveyed by earnings tracker First Call expected a loss of $1.54 a share. The Minnesota-based airline earned net income of $207 million, or $2.33 a share, a year earlier.
Shares of Northwest (NWAC: up $0.14 to $12.25, Research, Estimates) were trading lower before the mid-morning earnings report, then rallied to trade little changed soon after the news.
Including special items, which includes the federal help and pre-tax charges of $61 million for severance costs and aircraft write-downs, the airline posted net income of $19 million, or 20 cents a share.
Revenue fell 17 percent to $2.6 billion from $3.1 billion a year ago, which put it below the First Call revenue forecast of $3.0 billion.
All of the nation's eight largest airline companies except Southwest Airlines (LUV: down $0.14 to $15.88, Research, Estimates) are expected to post losses in the third quarter due to the sharp drop in air travel and increased costs in the wake of the attack. But a drop in business travel had prompted analysts to predict losses even before the attack for all the carriers except Southwest, Continental Airlines (CAL: up $0.46 to $17.46, Research, Estimates) and Northwest. Northwest said Thursday it believes it would have been profitable in the quarter if not for the attack. 
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