Delta Air Lines Inc, the largest airline of the world, said today it recorded a loss of $1.4 billion in the fourth quarter on charges related to employee stock awards last year, merger costs and fuel hedge losses.
Shares of Delta fell 17.7 percent or $ 1.77 to $ 8.16 each by 9:51 a.m. EST on the New York Stock Exchange Tuesday.
The company said the quarter's net loss was equivalent to $2.11 per share, compared to 18 cents per share or $70 million in the fourth quarter of 2007. The industry was hit by high energy prices in 2008 and economic weakness that reduced travel demand. Despite oil prices declined, the airline didn't benefit because of bad bets on fuel hedges.
Excluding one-time items, the company said it had lost $340 million, or 50 cents per share more than the 34 cents per share, analysts expected according to Thomson Reuters forecasts. The special items included more than $900 million in charges related to employee equity awards, and a $91 million loss on out-of-period fuel hedges, Reuters reported.
Delta which completed its merger with Northwest Airlines on Oct. 29 to produce more efficient operations and savings to help relieve its fuel bills, said its revenue in the last quarter of the year increased 43 percent to $6.7 billion, from $4.7 billion a year earlier, the company reported.
Delta said it lost $8.9 billion, or $19.08 a share in the full 2008 fiscal year, compared to a profit of $1.6 billion in 2007.