Delta Air Lines Inc. said Wednesday it swung to a hefty loss in the second quarter despite a strong increase in sales, pushing its red ink to more than $7 billion since the start of the year.
But the carrier's shares soared over 12 percent as the results, hit by unprecedented fuel costs and a decline in the company's market value, still beat Wall Street estimates when one-time items are excluded.
The Atlanta-based company also said it expects to achieve $2 billion in cost savings by 2012 from its acquisition of Northwest Airlines Corp. That is double what it estimated when it announced the deal on April 14. It also said it expects to spend only $600 million in cash to integrate the two companies, compared to an earlier projection of $1 billion.
For the three months ending June 30, Delta said it lost $1.04 billion, or $2.64 a share, compared to a profit of $1.59 billion a year ago when Delta emerged from bankruptcy protection. It did not provide a per-share figure for the year-ago period. A year ago, it reported a different figure for its net income - $1.77 billion - which a spokeswoman said Wednesday was due to fresh-start accounting.
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Excluding one-time items, Delta earned a profit of $137 million, or 35 cents a share, in the second quarter. Analysts polled by Thomson Financial, on average, forecast profit of 10 cents a share. Their estimates usually do not include one-time items.
– Associated Press
Ga. officials to replace confusing HOV signs
Georgia transportation officials are planning to replace a confusing sign at the left-hand interstate exit where a bus crash killed seven people in March 2007.
The National Transportation Safety Board last week blamed the sign as the primary cause for the accident, also citing driver error and lack of seat belts as key factors.
Georgia officials will replace all HOV lane signs on metro Atlanta interstates by March 2010.
The bus driver thought he was staying in an HOV lane when he drove onto the exit ramp, plowed through a stop sign and hurtled from an overpass back onto the interstate below. Five members of Ohio's Bluffton University baseball team were killed, along with the driver and his wife. Another 28 people were injured.
– Associated Press
Atlanta newspaper cutting staff by 200
The Atlanta Journal-Constitution is cutting its staff by nearly 200 jobs and eliminating some targeted news sections.
Publisher John Mellott said the move, announced Wednesday, is a cost-cutting plan in the face of dwindling advertising revenues and steadily increasing fuel and newsprint costs. Mellott said the job cuts will be mainly in news and advertising departments between August and October through voluntary buyouts and layoffs.
The cuts represent about 8 percent of the 2,300-member staff.
It's the second downsizing in two years at Georgia's largest newspaper. In February 2007, the Journal-Constitution announced it was offering contract buyouts to 80 newsroom employees and reducing its circulation area.
– Associated Press
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