(NYSE: CAL) today announced it will record a special charge of $39 million
($61 million before taxes) in the fourth quarter of 2001 associated primarily
with the impairment of various owned aircraft and spare engines. In
accordance with applicable accounting standards, the company records
impairment losses on owned assets when circumstances indicate that the assets
might be impaired and the expected cash flows are not sufficient to recover
the carrying value of the assets, resulting in a write-down of the assets to
their fair value. The aircraft in the impairment include all of the company`s
owned DC-10-30, ATR-42, EMB-120, and Boeing 747 and 727 aircraft. The charge
is not related to the permanent grounding of aircraft.
In the fourth quarter, the Company will also record $174 million of
compensation pursuant to the Air Transportation Safety and System
Stabilization Act, resulting in a total of $417 million of compensation
pursuant to such Act for 2001.
Continental Airlines will release fourth quarter financial results on
January 16, 2002.