Delta Air Lines
said third-quarter revenue rose 9% from last year, but the Atlanta-based carrier, now in bankruptcy, suffered from the same high fuel costs that have bedeviled the entire sector.
The company's quarterly loss was $1.1 billion, compared with a loss of $646 million in the prior year. Excluding reorganization costs and certain items, the loss would have been $438 million in the most recent quarter.
Delta's third-quarter operating loss was $240 million, reflecting a $442 million year-over-year increase in fuel expenses. The company paid an average price of $1.82 for a gallon of fuel in the September quarter, a 51.7% increase over the previous year.
Mainline unit costs fell 3.7% from the third quarter in 2004, but factoring out fuel and other items, unit costs would have declined 17.3%.
The cost of filling up its planes, along with pressure from low-cost rivals, contributed to forcing Delta into Chapter 11 on Sept. 14, the same day another U.S. carrier,
, filed for bankruptcy.
As of Sept. 30, Delta had $2.6 billion in cash, cash equivalents and short-term investments, of which $1.4 billion was unrestricted.
"Our results for the third quarter show the challenges we continue to face," said Gerald Grinstein, Delta's chief executive. "We are committed to moving quickly and decisively to achieve our business plan that we announced in late September. We believe this plan will position Delta to become the lean, aggressive, profitable airline it must be to compete effectively over the long-term in the fast-changing airline industry environment."
Consolidated traffic rose 6.9% in the quarter, while capacity climbed 4.8%. Load factor for the third quarter was 79.2%, a 1.6-point increase year over year.
Because of the oppressive price of fuel, operating expenses for the quarter climbed 3.8% from last year, but cost controls pushed mainline operating expenses, excluding fuel and special items, down 13.4%.
As is usually the case with bankruptcies, Delta's existing shares will almost certainly have no value if and when the airline leaves court protection. For now, the stock still trades, and Thursday it closed around 65 cents.