Northwest Becomes Third Airline To Warn On Profits
By Stephen Trimble
14-Mar-2001 10:40 AM U.S. EST
A softening U.S. economy appears to have struck another carrier as Northwest Airlines issued a profit warning Wednesday, predicting a first quarter loss of $130 million to $150 million.
A decline in corporate business travel dropped Northwest's earnings below expectations last month, the carrier reported to the U.S. Securities and Exchange Commission. Northwest predicted first quarter losses per share would range between $1.55 to $1.80.
"In the near-term, we remain cautious as we expect to see continued softness in our mix of business travelers," Northwest said. Currently, revenue from both domestic and international routes has fallen short of predictions by analysts, the airline said.
Northwest's profit warning comes only one day after Delta predicted it will lose up to $110 million in the first quarter, and two weeks after US Airways warned that an anticipated first quarter loss would be worse than expected.
Both carriers blamed slumping revenues on the struggling economy. A possible strike by Delta pilots next month also scared away some passengers, Delta said.