=20 ---------------------------------------------------------------------- This article was sent to you by someone who found it on SF Gate. The original article can be found on SFGate.com here: http://www.sfgate.com/cgi-bin/article.cgi?file=3D/news/archive/2003/07/17/f= inancial0817EDT0025.DTL ---------------------------------------------------------------------- Thursday, July 17, 2003 (AP) Delta reports profit on government reimbursements, Worldspan sale HARRY R. WEBER, AP Business Writer (07-17) 05:17 PDT ATLANTA (AP) -- Delta Air Lines cited government reimbursements related to terrorism security costs and the sale of its stake in ticket processor Worldspan as it posted a profit Thursday for the second quarter as revenue fell nearly 5 percent. Net income for the nation's third-largest carrier was $184 million, or $1.40 a share, for the three months ended June 30, compared to a loss of $186 million, or $1.54 a share, for the same period a year ago. Excluding one-time items, Atlanta-based Delta reported a loss of $237 million, or $1.95 a share, in the quarter, compared to a loss of $162 million, or $1.34 a share, a year ago. Analysts surveyed by Thomson First Call had expected a loss of $2.08 a share for the the latest quarter. Revenue for the quarter was $3.31 billion, down 4.8 percent from $3.47 billion a year ago. "Even though we saw some initial postwar traffic recovery, the overall revenue environment remains weak," said chairman and chief executive Leo Mullin. "One-time events played the most significant role in Delta's June quarter results." He added, "While encouraged by our progress, it is clear that Delta must remain diligent in our efforts to establish a viable revenue-to-cost relationship. Delta still faces many challenges as we cautiously emerge from the worst business cycle in our company's history." Delta's one-time items in the quarter included gains of $251 million from government reimbursements and $176 million from the sale of Delta's 40 percent stake in Worldspan and a $6 million charge for adjustments related to accounting changes. For the first six months of the year, Delta lost $282 million, or $2.35 a share, compared to a loss of $583 million, or $4.79 a share, for the year-ago period. Excluding one-time items, Delta lost 663 million, or $5.44 a share, for the six months, compared to a loss of $516 million, or $4.25 a share, for the same period in 2002. Six-month revenue slipped to $6.46 billion from $6.58 billion a year earlier. Delta has been working to trim costs. In late June, Delta and its pilots union opened talks to discuss wage concessions. Delta has said it wants to cut pilots' hourly wages by 22 percent, cancel pay raises due over the next year and reduce some benefits. The airline also wants to rescind a 4.5 percent raise the pilots received May 1 and a similar raise due next May. Delta lost $1.3 billion last year and $466 million in the first quarter this year. The carrier has reduced its work force by 16,000 since the Sept. 11, 2001, terrorist attacks and has furloughed hundreds of pilots. It has outlined 16 initiatives it hopes will reduce non-fuel costs by 15 percent by 2005. Initiatives include placing more self-service kiosks in airports and offering more low-fare travel options, like its newly launched discount carrier, Song. Delta has also announced plans to sell premium food on some flights. Earlier this month, it completed the sale of its 40 percent stake in ticket processor Worldspan to Travel Transaction Processing Corp. On the Net: www.delta.com =20 ---------------------------------------------------------------------- Copyright 2003 AP