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Thursday, October 25, 2018

Delta Airlines posts $1.6 billion income in third quarter

Delta Airlines

Delta Air Lines has reported financial results for the September quarter 2018, with adjusted pre-tax income put at $1.6 billion while adjusted earnings per share was $1.80. 

 
Adjusted earnings per share were up 16 per cent compared to the prior year quarter, driven by revenue momentum, tax reform benefits and a four per cent lower share count. 

However, results reflect a $30 million negative impact from Hurricane Florence.
Delta’s Chief Executive Officer, Ed Bastian, said the solid eight per cent revenue growth, combined with flat non-fuel unit cost performance, helped offset 85 per cent of the $655 million fuel cost increase in the quarter.

“These achievements are a testament to the strength of the Delta business model and the hard work of the Delta people, and I am pleased to recognize their performance with an additional $395 million toward 2018 profit sharing. 

“Our commercial momentum and improved cost trajectory give us confidence that we are on a path to deliver continued top-line growth and expand margins as we move into 2019,” Bastian said.
Delta’s adjusted operating revenue of $11.8 billion for the September quarter improved eight percent, or $912 million versus the prior year. 

This quarterly revenue result marks a record for the company, driven by improvements across Delta’s business, including a nearly 20 per cent increase in premium product ticket revenues and double-digit percentage increases in cargo, loyalty and Maintenance, Repair and Overhaul revenue.

Total unit revenues excluding refinery sales (TRASM) increased 4.3 per cent during the period driven by strong demand and improving yields. Foreign exchange benefit of approximately half a point was offset by the impact of Hurricane Florence.

Delta’s president, Glen Hauenstein, said the group generated record revenues in the September quarter on strong demand across the business and a favorable yield environment. 

Looking ahead, Hauenstein said they expect of December quarter a total unit revenue growth of three to five per cent, driving full year revenue growth to eight per cent. 

“The benefits of our brand, industry-leading network, and relentless focus on the customer are driving revenue growth, improving margins and accelerating the pace of our recapture of higher fuel costs,” he said.

Despite an expected 30 per cent increase in fuel price, Delta expects pre-tax margins to stabilise in the December quarter driven by continued top-line growth and improving cost performance.
Total adjusted operating expenses for the September quarter increased $1.0 billion versus the prior year quarter, with more than half of the increase driven by higher fuel prices.

SOURCE: https://guardian.ng/business-services/delta-airlines-posts-1-6-billion-income-in-third-quarter/

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