Skywest and Comair
03-27-2007, 07:04 PM
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Skywest and Comair
Delta Air Lines revealed on Tuesday that it might seek to unload more assets, a move that is sure to resurrect speculation about a sale of its regional carrier Comair.
In a filing with the Securities and Exchange Commission, Chief Financial Officer Ed Bastian said that the company will "seek continued opportunities to unlock shareholder value," including "further monetization of assets."
The company didn't announce specifically what it might sell, but in August 2005, the company agreed to sell its subsidiary Atlantic Southeast Airlines to SkyWest (nasdaq: SKYW - news - people ) for $425 million. Also in 2005, it sold some of its wide-body jets.
One sale possibility is Comair, a wholly owned subsidiary of Delta based in Cincinnati. The company has not said exactly what it plans for Comair, and rumors have long swirled that it might unload the carrier to improve its liquidity.
"We will, once we're out of bankruptcy, look at whether owning that business makes a lot of sense," Bastian said at an investor conference Tuesday.
Bastian also said Delta (other-otc: DALRQ - news - people ) hopes to return to profitability this year, predicting a pre-tax income of $816 million. Basitan explained in the filing that improving RASM, or revenue per available seat mile, has been crucial in the company's brightening prospects.
RASM is a key measurement used by airlines. Delta's RASM has traditionally lagged behind its competitors.
In 2005, Delta's adjusted passenger RASM was 8.6 cents, or 86% of the industry average of 9.9 cents. By last year, it had improved to 10.2 cents, or 93% of the industry average of 11.0 cents. Delta said it expects its RASM to grow a further 4% in 2007, compared to 1.5% for the industry.
Delta also stated strategic plans for 2007 on Tuesday. Chief Operating Officer Jim Whitehurst said the company aims to improve market share in New York, expand internationally, continue to improve its RASM and earn customer preference.
Delta also said in the filing, which is a presentation for the Tuesday conference, that it now plans to emerge from Chapter 11 on April 30 and relist its stock in early May. The company had said in earlier filings that it planned for a May exit from Chapter 11.
Delta was delisted from the New York Stock Exchange in 2005 after the company fell below the exchange's minimum share price standard. The company filed for bankruptcy soon after. (See: "Grinstein's Delta Bankrupt.")
The Associated Press contributed to this article.
In a filing with the Securities and Exchange Commission, Chief Financial Officer Ed Bastian said that the company will "seek continued opportunities to unlock shareholder value," including "further monetization of assets."
The company didn't announce specifically what it might sell, but in August 2005, the company agreed to sell its subsidiary Atlantic Southeast Airlines to SkyWest (nasdaq: SKYW - news - people ) for $425 million. Also in 2005, it sold some of its wide-body jets.
One sale possibility is Comair, a wholly owned subsidiary of Delta based in Cincinnati. The company has not said exactly what it plans for Comair, and rumors have long swirled that it might unload the carrier to improve its liquidity.
"We will, once we're out of bankruptcy, look at whether owning that business makes a lot of sense," Bastian said at an investor conference Tuesday.
Bastian also said Delta (other-otc: DALRQ - news - people ) hopes to return to profitability this year, predicting a pre-tax income of $816 million. Basitan explained in the filing that improving RASM, or revenue per available seat mile, has been crucial in the company's brightening prospects.
RASM is a key measurement used by airlines. Delta's RASM has traditionally lagged behind its competitors.
In 2005, Delta's adjusted passenger RASM was 8.6 cents, or 86% of the industry average of 9.9 cents. By last year, it had improved to 10.2 cents, or 93% of the industry average of 11.0 cents. Delta said it expects its RASM to grow a further 4% in 2007, compared to 1.5% for the industry.
Delta also stated strategic plans for 2007 on Tuesday. Chief Operating Officer Jim Whitehurst said the company aims to improve market share in New York, expand internationally, continue to improve its RASM and earn customer preference.
Delta also said in the filing, which is a presentation for the Tuesday conference, that it now plans to emerge from Chapter 11 on April 30 and relist its stock in early May. The company had said in earlier filings that it planned for a May exit from Chapter 11.
Delta was delisted from the New York Stock Exchange in 2005 after the company fell below the exchange's minimum share price standard. The company filed for bankruptcy soon after. (See: "Grinstein's Delta Bankrupt.")
The Associated Press contributed to this article.
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