Northwest Airlines Posts $4.1 Billion Q1 Net Loss

Northwest Airlines has reported that its net loss for the first quarter of 2008 was $4.1 billion, or $15.78 per share, compared to net loss of $292 million for the first quarter of 2007.

The net loss includes a non-cash goodwill impairment charge of $3.9 billion. Excluding non-recurring, non-cash impairment charges and losses associated with marking-to-market out-of-period fuel hedges, Northwest reported a first quarter 2008 net loss of $191 million versus the first quarter 2007 when the airline reported net income of $73 million before the impact of reorganization items and out-of-period fuel hedge gains.

The operating revenues for the first quarter of 2008 rose to $3.1 billion, up 8.8% from the first quarter 2007. Northwest ended the quarter with $3.2 billion in unrestricted cash and $484 million in restricted cash. Northwest’s ending unrestricted cash was $2.4 billion in the first quarter 2007.

Dave Davis, executive vice-president and CFO of Northwest Airlines, said: “Despite our first quarter loss, Northwest ended the quarter with the strongest liquidity among network carriers. Today’s results demonstrate the volatility of the airline industry and the challenges that airlines face related to uncontrollable increases in input costs such as oil.”