Delta Airlines 2003 Annual Report Download - page 45

Table of Contents
• A $321 million gain in 2003 from the sale of certain investments. This primarily relates to a $279 million gain from the sale of our equity investment in
Worldspan and a $28 million gain from the sale of a portion of our Orbitz shares. For additional information about these investments, see Note 17 of the
Notes to the Consolidated Financial Statements.
• Gain (loss) on extinguishment of debt, net was zero for 2003 compared to a $42 million loss in 2002. During 2003, we recorded a $15 million loss
resulting from our repurchase of a portion of outstanding Employee Stock Ownership Plan ("ESOP") Notes, offset by a $15 million gain related to our
debt exchange offer. For additional information about our repurchase of ESOP Notes in 2003 and 2002 and our debt exchange offer in 2003, see Note 6
of the Notes to the Consolidated Financial Statements.
• A $9 million charge in 2003 compared to a $39 million charge in 2002 for fair value adjustments of financial instruments accounted for under
Statement of Financial Accounting Standards ("SFAS") No. 133, "Accounting for Derivative Instruments and Hedging Activities" ("SFAS 133"). This
relates to derivative instruments we use in our fuel hedging program and to our equity warrants and other similar rights in certain companies.
• Miscellaneous expense, net was $19 million in 2003 compared to miscellaneous income, net of $1 million in 2002 due primarily to a decrease in
earnings from our equity investment in Worldspan, which we sold in June 2003.
Results of Operations—2002 Compared to 2001
Net Loss and Loss per Share. We recorded a consolidated net loss of $1.3 billion ($10.44 diluted loss per share) in 2002, compared to a consolidated net
loss of $1.2 billion ($9.99 diluted loss per share) in 2001.
Operating Revenues. Operating revenues were $13.3 billion in 2002, decreasing 4% from 2001. Passenger revenues fell 5% to $12.3 billion. RPMs were
unchanged on a capacity decline of 4%, while passenger mile yield decreased 5% to 12.08¢. The decreases in operating revenues, passenger revenues and
passenger mile yield from the depressed 2001 levels reflect the continuing effects of the September 11 terrorist attacks on our business, the challenging
revenue environment discussed above and the weakness of the U.S. and world economies.
North American Passenger Revenues. North American passenger revenues fell 6% to $10.0 billion in 2002. RPMs increased 1% on a capacity decrease
of 3%, while passenger mile yield decreased 7%. The decline in passenger mile yield reflects the challenging revenue environment, including significant fare
discounting as well as a substantial reduction in high-yield business traffic reflecting the continuing effects of the September 11 terrorist attacks on our
business.
International Passenger Revenues. International passenger revenues decreased 2% to $2.3 billion in 2002. RPMs fell 2% on a capacity decline of 7%,
while passenger mile yield increased 1%. The decline in our international capacity was primarily driven by reductions in our Pacific operations due to weak
passenger demand.
Cargo and Other Revenues. Cargo revenues decreased 9% to $458 million in 2002. This reflects a 7% decline due to Federal Aviation Administration
security measures,
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