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Delta lost $1B in '01
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January 31, 2002: 10:07 a.m. ET
Airline's 4Q loss wider than forecasts; America West hits estimated loss.
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NEW YORK (CNN/Money) - Delta Airlines posted more than $1 billion in operating losses last year, as its fourth-quarter loss flew over Wall Street expectations.
The nation's No. 3 airline lost $486 million, or $3.97 a share, excluding special items, including the latest round of financial assistance from the federal government. Analysts surveyed by earnings tracker First Call were looking for a loss of $3.89 a share in the period.
That loss per share estimate rose from $3.64 after the airline warned last month it would lose about $500 million in the quarter. It earned $79 million, or 60 cents a share, in the year-earlier quarter, excluding special items.
The fourth-quarter result brought losses for the year excluding special items to $1.0 billion, or $8.46 a share, compared with income excluding special items of $897 million, or $6.81 a share, in 2000.
The net loss for the year came to $1.2 billion, or $9.99 a share, despite federal aid of $392 million, or $3.18 a share, in the course of the year. That compares with net income of $815 million, or $7.05 a share, in 2000.
Revenue fell 28 percent for the quarter to $2.9 billion from $4.0 billion, as the miles flown by paying passengers declined 18 percent, and the average amount paid by passengers per mile flown fell 14 percent. But the revenue topped First Call's forecast of $2.8 billion in the period.
"These results clearly reflect a year of challenges unlike any we've seen in the history of aviation," said a statement from Delta CEO Leo Mullin. Still, he said the airline has a strong enough balance sheet to respond quickly to any turnaround in demand for air travel. It ended the year with a $2.2 billion cash balance.
Mullin told analysts during a conference call that the airline should be able to cut its daily cash outflows to between $3 million and $4 million during the first quarter, and that first-quarter results will be "somewhat better" than the fourth-quarter results. First Call's consensus forecast called for the airline to lose $2.20 a share in the period, which would be only 56 percent of the per-share loss of the fourth quarter. The company lost $1.02 a share in the first quarter of 2001.
Mullin said he believed that Delta would be profitable again in the second half of the year. First Call's forecast is for earnings per share of 74 cents in the third quarter and 29 cents a share in the fourth quarter.
Shares of Delta (DAL: up $0.17 to $31.74, Research, Estimates) still gained in early trading Thursday despite the larger-than-expected loss.
America West loss hits forecast
In other airline financial news, America West Holdings Corp. (AWA: down $0.16 to $3.82, Research, Estimates), the nation's No. 8 airline company, lost $89.1 million, or $2.64 a share, excluding special items, which put it in line with First Call's forecasts.
Including special items and the $48 million in pre-tax federal assistance it received, the company posted a net loss of $60.9 million, or $1.81 a share, up from the net loss of $41.7 million, or $1.24 per share, a year earlier. Revenue fell 30 percent to just under $400 million, as miles flown by paying passengers was off 15 percent and the average amount paid per mile flown fell 18 percent.
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Phoenix-based America West is the only major airline to seek and receive federal loan guarantees. It agreed to give up an equity stake in the airline to the government in return for the help. 
-- Reuters contributed to this report.
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