April 23, 2008 / 12:48 PM / 12 years ago

Northwest loses $4 billion on big charge

CHICAGO (Reuters) - Northwest Airlines Corp NWA.N, which plans to merge with Delta Air Lines Inc (DAL.N), posted a quarterly net loss of $4.1 billion Wednesday on a big one-time charge and skyrocketing fuel prices.

The loss includes a $3.9 billion non-cash goodwill impairment charge. Excluding that charge and losses associated with fuel hedges, the No. 5 U.S. airline lost $191 million in the quarter.

In the year-earlier period, while it was restructuring in bankruptcy and before its new shares were issued, Northwest lost $292 million.

First-quarter operating revenue rose 8.8 percent to $3.1 billion.

Year-over-year, the carrier saw its fuel bill jump 58 percent to $1.11 billion. All major airlines have seen similar increases in fuel costs as the price of oil has notched record highs.

Rising costs and the need to run a more efficient airline are key factors behind Northwest’s decision to merge with Delta to form the world’s largest airline.

Northwest ended the first quarter with $3.2 billion in unrestricted cash and $484 million in restricted cash.

Reporting by Kyle Peterson; editing by John Wallace

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