Bankruptcy Math: When Is 'Only' Losing $300 Million Considered A Good Thing? | Aero-News Network
Aero-News Network
RSS icon RSS feed
podcast icon MP3 podcast
Subscribe Aero-News e-mail Newsletter Subscribe

Airborne Unlimited -- Recent Daily Episodes

Episode Date

Monday

Tuesday

Wednesday

Thursday

Friday

Airborne On ANN

Airborne 02.08.16

Airborne 02.09.16

Airborne 02.03.16

Airborne 02.04.16

Airborne 02.05.16

Airborne Hi-Def On YouTube

Airborne 02.08.16

Airborne 02.09.16

Airborne 02.03.16

Airborne 02.04.16

Airborne 02.05.16

Sat, Mar 04, 2006

Bankruptcy Math: When Is 'Only' Losing $300 Million Considered A Good Thing?

Answer: When You Lost $314 Million One Year Ago

In the slimmest of signs the airline may be at the beginning of its recovery from Chapter 11 bankruptcy, for the first time in recent memory Delta Air Lines reported losing less money in January than during a comparable period one year ago.

"While Delta continued to post significant losses in January, the company is making progress in stabilizing our liquidity and implementing our business plan," Delta's financial chief, Ed Bastian, said in a statement to the Atlanta Journal-Constitution.

In its monthly financial statement released Friday, Delta reported a January loss of $300 million. That's down from the $314 million the carrier lost in January 2005. The airline also ended the month with $2.1 billion in unrestricted cash available, which is up slightly from December 2005.

If you remove $87 million in costs related to bankruptcy -- including the cost of renegotiating aircraft and facilities leases, and attorney fees -- Delta's loss would be a more-substantially-improved $213 million.

Perhaps most encouraging, however, is the success Delta has had recently in "hedging" fuel prices. This tactic -- made famous by Southwest Airlines -- allowed Delta to fix prices for jet fuel at an average of $1.75 per gallon.

That isn't all that great -- the average price for Jet-A in the Southeast region is, you guessed it, $1.75 per gallon -- but should fuel prices increase, Delta will have at least a portion of its fuel supply price-protected -- unlike last year, when high fuel prices hurried Delta's entry into Chapter 11.

Bastian said the airline's renewed ability to enter fuel hedging contracts, which are based on good credit, or cash reserves, "is another indication of the progress we are making in our ongoing efforts to strengthen our financial performance."

By its own estimate, Delta has also been able to reduce its unit costs, excluding fuel, by 5.3 percent compared to January 2005. If you include fuel costs, however, overall costs rose 2.7 percent.

Unit revenue, however was up almost 13 percent compared to a year ago.

FMI: www.delta.com

Advertisement

More News

Airborne 02.08.16: Gone West-Jeff Pino, UAL Flt Training, Skydive Myrtle Beach

Also: FAA Reauthorization Fight, Westjet 737, FAA Unions, Tuskegee Airmen Mustang, Orion Crew Module, NATA, Commercial/CFI Syllabus ANN is aggrieved to report that former Sikorsky >[...]

Airborne 02.05.16: Collier Trophy Noms, NJ Homeowner Nonsense, Flight Design USA

Also: A-10 Survives, The Essential Aero-Community, Miami Seaplanes, ERAU WACO, Jeppesen Leadership, ADS-B Kickstarter, Guilty Non-Pilot The National Aeronautic Association announce>[...]

Airborne 02.08.16: Gone West-Jeff Pino, UAL Flt Training, Skydive Myrtle Beach

Also: FAA Reauthorization Fight, Westjet 737, FAA Unions, Tuskegee Airmen Mustang, Orion Crew Module, NATA, Commercial/CFI Syllabus ANN is aggrieved to report that former Sikorsky >[...]

ANN's Daily Aero-Linx (02.09.16)

General Aviation Awards The mission of the General Aviation Awards program is to recognize individual aviation professionals on the local, regional, and national levels for their c>[...]

ANN's Daily Aero-Term (02.09.16): Center Weather Advisory

An unscheduled weather advisory issued by Center Weather Service Unit meteorologists for ATC use to alert pilots of existing or anticipated adverse weather conditions within the ne>[...]

blog comments powered by Disqus



Advertisement

Advertisement

Podcasts

Advertisement

© 2007 - 2016 Web Development & Design by Pauli Systems, LC