Corporations start to tally Sandy's costs

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Corporate America is just starting to add up its losses from superstorm Sandy, expected to be one of the most expensive storms in U.S. history.

Delta Air Lines and Verizon were the first two major companies to state the obvious, saying Friday that they will lose money because of the storm.

Delta had to cancel thousands of flights, while Verizon had cell towers blown out of commission and its offices flooded. Early estimates say Sandy may have caused up to $50 billion in economic damages after shutting down the country's largest transportation system and knocking out power for millions of homes and businesses.

As companies turn the lights back on and employees return to their desks, experts say more companies will follow Delta and Verizon in the coming weeks as they tally up the storm's costs.

"We know trees are down, power is out and houses have been swept away," said Dan Greenhaus, chief global strategist at the brokerage BTIG in New York. "But it's going to take a lot of time to assess the damage. This could be a story well into the first few months of next year."

Transportation around New York City slowed to a crawl in the days before the storm hit. Airlines stopped using the region's airports, causing a chain-reaction of cancellations in other cities across the country. More than 20,000 flights were canceled, according to FlightStats.

Atlanta-based Delta Air Lines Inc. said Friday that it lost $45 million in sales from canceling more than 3,500 flights in the final days of October.

Verizon Communications Inc. is still working to restore services for many of its customers and warned that Sandy could put a "significant" hit on its results. The New York-based company, however, cautioned that it's not yet possible to put a specific dollar figure on the costs.

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Some companies such as Lowe's Cos. and Home Depot Inc. could see sales pick up as people load up on generators and other supplies needed for rebuilding.

Retail stores, excluding restaurants, stood to lose at least $25 billion in sales during the week of the superstorm, according to Burt Flickinger III of the retail consultancy Strategic Resource Group. Because of the storm, he cut his forecast for holiday sales to a 2.1 percent increase over last year from the 3.2 percent increase he had predicted earlier.

Major retailers began reopening stores Friday at the outset of the critical holiday shopping period. Sears Holdings Corp., which operates Kmart and Sears, said 29 of its stores in the affected region remained closed on Friday, down from 187 Monday.

Orlando, Fla.-based Darden Restaurants Inc., parent of Olive Garden and Red Lobster, by Friday had reopened all but 21 of the 260 restaurants it closed Monday. Flooding kept two restaurants closed, while the rest had no power. Of the 21 still shuttered, 20 are in New York and New Jersey; one is in Connecticut.

During their monthly sales reports Thursday, Costco Wholesale Corp., Nordstrom, and Rite Aid all said they expected their November sales would suffer.

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