1st Q result predictions

[FWAAA]

Just a serious question,
What is a "non cash write down"?

When a company decides an asset is worth less than shown on the balance sheet, it can write down the value of the asset. Causes a non-cash charge. Company didn't spend that money - it just admitted that its assets were overvalued. But it can cause a net loss (like in this case). But unlike fuel or wages, it didn't write anyone a check for this "expense."

In this case, it was Goodwill, that all-purpose imaginary asset. DL and NW added a boatload of it to their balance sheets when they emerged from Ch 11 protection.

Big discussion of it in the 10-Ks for DL and NW.

 

[jimntx]

Just a serious question,
What is a "non cash write down"?

It's an "on paper" accounting ploy. Goodwill is an intangible asset (or liability) of every company. Your airplanes, physical facilities, Accounts Receivable, etc. all have an asset value stated in dollars.

However, when a company is sold, it is (usually) sold for more than the sum of all the tangible assets. The difference between what the tangible assets are worth and the selling price is called goodwill. It's basically stating that the company is worth more than its assets because of its reputation, history, etc.

Under the imprimatur of the Federal Accounting Standards Board (FASB), companies are allowed on their books to assign a dollar value to that goodwill and have it count in the company's total asset value. While the write down of goodwill is never good, in the long run it doesn't really tell you anything about the financial health of the company. For all we know, the write down occurred because the current management wishes to be honest and they want to restate some inflated goodwill value that a previous management set.

However, to keep posting that Dl lost $6 billion dollars in the first quarter is an indication of the poster's ignorance of accounting and finance. DL lost $274 million in the first quarter. That is the figure to be concerned with. And, compared to my company (AMR) and UA, DL didn't do too badly.

 

[sharktooth]

However, to keep posting that Dl lost $6 billion dollars in the first quarter is an indication of the poster's ignorance of accounting and finance. DL lost $274 million in the first quarter. That is the figure to be concerned with. And, compared to my company (AMR) and UA, DL didn't do too badly.

Thank you, and the two above you, for a rational explanation. US has some employees that seem to really like setting their hair on fire and run around yelling the sky is falling. It has taken the employees quite a while to get them out of "leadership" positions (witness the ALPO booting).

 

[autofixer]

However, to keep posting that Dl lost $6 billion dollars in the first quarter is an indication of the poster's ignorance of accounting and finance. DL lost $274 million in the first quarter. That is the figure to be concerned with. And, compared to my company (AMR) and UA, DL didn't do too badly.

To be fair to the poster, the national media has also been reporting all day that DAL lost 6.9 billion and NWA lost 4.1 billion.

http://biz.yahoo.com/ap/080423/earns_delta.html?.v=11

 

[Elevation]

US will probably due worse than NW or DL for the first qtr.

 

[FWAAA]

To be fair to the poster, the national media has also been reporting all day that DAL lost 6.9 billion and NWA lost 4.1 billion.

http://biz.yahoo.com/ap/080423/earns_delta.html?.v=11

True - the local news readers on Los Angeles tv have been saying all day that "high fuel prices caused DL and NW to report multi-billion dollar losses for the first quarter."

Idiots.

Same sort of idiocy as when UA reported its $24 billion net loss during its Ch 11 case and then later reported a $22 billion net profit the following year (or two years later) at the conclusion of its bankruptcy.

 

[X-U]

And DL and NW are more than happy to spread the FUD in order to "get the deal done".

 

[REACC1]

It's an "on paper" accounting ploy. Goodwill is an intangible asset (or liability) of every company. Your airplanes, physical facilities, Accounts Receivable, etc. all have an asset value stated in dollars.

However, when a company is sold, it is (usually) sold for more than the sum of all the tangible assets. The difference between what the tangible assets are worth and the selling price is called goodwill. It's basically stating that the company is worth more than its assets because of its reputation, history, etc.

Under the imprimatur of the Federal Accounting Standards Board (FASB), companies are allowed on their books to assign a dollar value to that goodwill and have it count in the company's total asset value. While the write down of goodwill is never good, in the long run it doesn't really tell you anything about the financial health of the company. For all we know, the write down occurred because the current management wishes to be honest and they want to restate some inflated goodwill value that a previous management set.

However, to keep posting that Dl lost $6 billion dollars in the first quarter is an indication of the poster's ignorance of accounting and finance. DL lost $274 million in the first quarter. That is the figure to be concerned with. And, compared to my company (AMR) and UA, DL didn't do too badly.

http://music.aol.com/song/more-than-a-feeling/4066755

 

[hp-csr-phx]

175 million loss.

 

[cynic]

175 million loss.

I was thinking 150-180, same general range.

 

[Elevation]

$217mil+ special items

 

[Edward]

Since results are posted in a new thread I'm going to close this one out.