Friday, April 16, 2004

Delta's finance chief leaving

By James Pilcher
The Cincinnati Enquirer

Delta Air Lines has lost its second high-ranking executive in a month.

Executive vice president and chief financial officer M. Michele Burns announced Thursday that she was leaving at the end of April to take a similar job with an Atlanta-based utility.

The move comes less than a month after president and chief operating officer Fred Reid left to help start a new airline.

"Leaving is very difficult, but I made the decision that the time is right to take on a new opportunity," Burns said in a statement. "I am confident that Delta will work through its challenges and regain its position at the top of the commercial aviation industry."

Burns, 46, joined the company in 1999, and was credited by Delta chief executive officer Gerald Grinstein with helping Delta build up enough cash to survive in the tumultuous days after the Sept. 11 terror attacks.

Atlanta-based Delta has its second-largest hub at Cincinnati/Northern Kentucky International Airport, and has 8,000 employees locally.

"We are quite discouraged by this latest defection from the airline industry of a talented manager we hold in high regard," Credit Suisse First Boston airline analyst Jim Higgins wrote in a note titled "Getting Lonely: Another One Bites The Dust."

"Burns' departure only underscores the extent to which the legacy airlines are over a barrel. ... We nonetheless view it as a blow to that company," he wrote, saying that it might be difficult to find a capable replacement.

Burns is the third top executive to leave this year. Former CEO Leo Mullin retired Jan. 1 and was replaced by Delta board member Grinstein. Then Reid left to work with Virgin Atlantic founder Richard Branson on creating a new low-cost airline. Delta's lead labor negotiator, Terry Erskine, also announced his retirement this month.

Mullin, who resigns his seat as chairman of the board this month, Reid and Burns were considered the brain trust of Delta, helping reshape the company's performance and technology.

But all three also were at the center of last year's controversy over executive pay, as all received large bonuses despite the company's poor financial performance while they insisted that pilots take pay cuts.


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