April 24, 2008	Thursday	Rabi-us-Sani 17, 1429

NEW YORK, April 23: US carriers Delta Air Lines and Northwest Airlines announced on Wednesday a combined $10.5 billion in losses as soaring fuel prices eroded their value ahead of their plan to create the world’s biggest airline.

Delta, the third-largest US airline, posted a net loss of $6.4 billion in the first quarter, after taking a charge of $6.1 billion to account for its reduced value.

Northwest, the number five US carrier, reported a net loss of $4.1 billion, on a depreciation of its value of $3.9 billion.

Both airlines explained that they had written down their value to account for a jump in jet fuel costs that is weighing on their profit outlooks and to calculate a fair value ahead of their planned merger, announced on April 14.

But even without these major accounting revisions, the two airlines were mired in the red during the first quarter, due to a more than 50 per cent rise in their jet fuel bills: excluding special items, Delta had a net loss of $274 million and Northwest $191 million. The two partners face a delicate economic balancing act as Delta prepares to acquire Northwest in a takeover that would create the largest airline in the US and worldwide.

Both carriers have swung again into losses about a year after they left the bankruptcy protection that had offered them a chance to clean up their balance sheets instead of going broke.

—AFP