Losses reported by two major airlines yesterday — Delta and Northwest — pushed red ink at the six big legacy carriers to nearly...
Losses reported by two major airlines yesterday — Delta and Northwest — pushed red ink at the six big legacy carriers to nearly $33 billion since 2001, when terrorist attacks led to an industry tailspin exacerbated by high labor costs and now, four years later, by expensive fuel.
Saying record fuel prices are masking the success it has had cutting costs elsewhere, Delta reported a nearly $1.1 billion first-quarter loss yesterday, the highest among its peers so far in the January-March period.
Northwest Airlines reported a $458 million loss. Discount carrier JetBlue Airways posted a $7 million profit, a 54 percent drop from last year.
Delta shares rose 16 cents to close at $3.86. Northwest shares rose 51 cents to close at $5.91. JetBlue shares rose $1.28 to $20.75.
Most Read Stories
- This season, Seahawks have crossed the line from brash to just plain unlikable | Matt Calkins
- Michael Bennett explodes at reporter following Seahawks-Falcons game
- Anti-Trumper John Kasich to doubters: I'm no lame duck
- Patty Murray, Maria Cantwell criticized for vote to block prescription drugs from Canada
- Can’t make it to D.C.? Seattle will have own women’s march
At Delta, chief executive Gerald Grinstein was blunt in describing the issues facing his company.
“Including fuel, Delta is not on plan, but excluding fuel, we are better than plan,” he said.
At Northwest, officials are pushing for labor cost cuts following high fuel prices. Chief executive Doug Steenland repeated yesterday his goal of $1.1 billion in labor concessions. He said he’s telling reluctant unions to accept pay cuts.
Profit grows by 16% for shipping carrier
UPS, the world’s largest shipping carrier, reported a more than 16 percent jump in first-quarter profit on strong growth in revenue and its international operations.
The results, announced before the market opened yesterday, beat Wall Street expectations. UPS also boosted its earnings guidance for the full year.
UPS shares rose $3.30, or 4.9 percent, to close at $70.56 in trading yesterday. The stock has been trading in a 52-week range of $67.10 to $89.11.
For the three months ending March 31, UPS said it earned $882 million, or 78 cents a share, compared to a profit of $759 million, or 67 cents a share, a year ago.
Analysts surveyed by Thomson Financial were expecting earnings of 73 cents a share.
Revenue in the January-March period rose nearly 11 percent to $9.89 billion, compared to $8.92 billion recorded a year ago.
Biotech’s profit rises on strong drug sales
Amgen, the biotechnology company, reported yesterday its profits rose sharply for the first quarter because of strong sales of its drugs to treat arthritis, anemia and infection in chemotherapy patients. It also increased its financial guidance for the year.
The company reported a profit of $854 million, or 67 cents a share, for the January-March period, up 24 percent from $690 million, or 52 cents a share, a year earlier. Revenue rose to $2.8 billion from $2.3 billion a year.
Amgen said its first-quarter earnings would have been $924 million, or 72 cents a share, if it had not incurred special charges related to the acquisitions of Immunex and Tularik as well as other one-time expenses.
On that basis, the earnings beat Wall Street analysts’ expectations by 4 cents a share, according to Thomson Financial.
For the year, the company boosted guidance from an earnings-per-share range of $2.70 to $2.85 to a range of $2.80 to $2.90.
Amgen shares rose $1.12, or nearly 2 percent, to close at $59.25 before it released its earnings report. But its shares tumbled $1.15, or 1.9 percent, in extended trading.
Quarterly profit falls 15% as Zocor declines
Merck, the third-largest U.S. drugmaker, said yesterday that quarterly profits fell 15 percent as sales of the company’s biggest product, the Zocor anti-cholesterol drug, faded in the face of competition.
Net income for the first quarter declined to $1.37 billion, or 62 cents a share, from $1.62 billion, or 73 cents, a year earlier. Sales dropped 4.8 percent to $5.36 billion from $5.63 billion, Merck said yesterday in a statement.
Shares of Merck, one of the 30 Dow stocks, rose 21 cents to $34.28.
The stock has lost 24 percent of its value since the Vioxx recall Sept. 30.
Profit for 2005 will be in a range of $2.44 to $2.52 a share. The projection doesn’t include reserves set aside for personal-injury lawsuits related to the Vioxx withdrawal or taxes on returning overseas profits to the U.S. Merck reported 2004 net income of $5.81 billion, or $2.61 a share.
Quarterly profit increases by 42%
McDonald’s, the world’s largest fast-food chain, reported yesterday that better sales in Europe and continued momentum in the United States lifted first-quarter profit 42 percent.
Net income for the January-through-March quarter was $727.9 million, or 56 cents per share, compared with $511.5 million, or 40 cents per share, a year earlier.
Results included a gain of $179 million, or 13 cents per share, due to a decreased tax rate and a charge of 3 cents per share because of a shift from share-based compensation to mostly cash-based compensation.
Excluding those items, the company said earnings were 46 cents per share. That was 4 cents higher than the initial consensus estimate of analysts surveyed by Thomson Financial before McDonald’s announced last week it would top expectations.
Revenue at the company was $4.8 billion, up 9 percent from $4.4 billion in the first quarter of 2004. Analysts had expected results of $4.71 billion.
Shares of McDonald’s, a Dow stock, fell 9 cents to close at $29.85 yesterday.
Compiled from Bloomberg News and The Associated Press