Delta Air Lines' losses continued to mount for during the first quarter of 2009, marking at least the sixth consecutive quarter that the SkyTeam carrier has been in the red.
Losses were $794 million largely due to fuel hedging and the economic downturn for the combined Delta and Northwest Airlines, which formally merged in October 2008. Excluding $684 million in realized fuel hedge losses and special items, Delta's results were breakeven during the quarter.
In addition, the $794 million loss was an improvement from the $6.4 billion Delta lost during the period in 2008.
Delta managed to shrink expenses during the quarter as its overall costs dropped to $7.2 billion from $11 billion during the same period in 2008 as revenue grew 40% to $6.7 billion.
The carrier's operating losses shrank as well to $483 million from $6.3 billion a year ago, when the airline experienced a $585 million rise in expenses as Delta's fuel costs increased 50% to $1.4 billion in the first quarter of 2008.
In addition, Delta generated roughly $600 million in operating cash flow and ended the first quarter with $5 billion in unrestricted liquidity, which was the same from the balance at 31 December 2008.
Looking ahead, Delta expects to trim staffing costs as more than 2,500 employees participated in the carrier's voluntary early out and early retirement programs offered in January. Most of the employees who elected to participate in the programs are expected to leave the company following the third quarter travel season.
In addition, the Atlanta-based operator expects to generate more than $100 million annually as it implements a $50 second checked bag fee for international travel booked today for departures from 1 July.