Delta Airlines 2008 Annual Report Download - page 39
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Table of Contents
Index to Financial Statements
Regional carriers. Passenger revenue of regional affiliates increased due to the inclusion of Northwest's operations. Excluding Northwest's operations,
regional carriers revenue declined $58 million primarily due to an 8% decrease in capacity in response to high fuel prices and the slowing economy, as well as
the termination of certain contract carrier agreements.
Cargo. Cargo revenue increased due to the inclusion of Northwest's operations and an increase in fuel surcharges, improved yields, and higher
international volume.
Other, net. Other, net revenue increased primarily due to the inclusion of Northwest's operations. Excluding Northwest's operations, other, net revenue
increased $485 million primarily due to (1) new or increased administrative service charges and baggage handling fees, (2) growth in aircraft maintenance and
staffing services to third parties and (3) higher SkyMiles program revenue.
Operating Expense
(in millions)
Year Ended
December 31,
2008
Increase
(Decrease)
Increase (Decrease) due to:
Combined
Northwest
Operations
Year Ended
December 31,
2007
October 30 to
December 31,
2008
Restructuring
and merger-
related items Impairments
Fuel
Expense Other
Operating Expense:
Aircraft fuel and related taxes $ 7,346 $ 4,686 $ 2,660 $ 718 $ — $ — $ 1,942 $ —
Salaries and related costs 4,802 4,189 613 504 — — — 109
Contract carrier arrangements 3,616 3,152 464 144 — — 303 17
Depreciation and amortization 1,266 1,164 102 91 — — — 11
Aircraft maintenance materials and outside repairs 1,169 983 186 113 — — — 73
Contracted services 1,153 996 157 128 — — — 29
Passenger commissions and other selling expenses 1,030 933 97 130 — — — (33)
Landing fees and other rents 839 725 114 106 — — — 8
Passenger service 440 338 102 35 — — — 67
Aircraft rent 307 246 61 40 — — — 21
Profit sharing — 158 (158) — — — — (158)
Impairment of goodwill and other intangible assets 7,296 — 7,296 — — 7,296 — —
Restructuring and merger-related(1) items 1,131 — 1,131 — 1,131 — — —
Other 616 488 128 88 — — — 40
Total operating expense $ 31,011 $ 18,058 $ 12,953 $ 2,097 $ 1,131 $ 7,296 $ 2,245 $ 184
(1) Restructuring and merger-related items reflects $333 million in one-time merger-related charges, as discussed below related to Northwest for the period from October 30 to December 31,
2008.
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