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26-Jul-2012 3:12 PM

Delta reports sharp profit decline in 2Q2012

Delta Air Lines revenue up 6% - financial highlights:

  • Three months ended 30-Jun-2012:
    • Operating revenue: USD9732 million, +6% year-on-year;
    • Operating costs: USD9598 million, +11%;
      • Fuel: USD3305 million, +24%;
      • Labour: USD1825 million, +5%;
    • Operating profit: USD134 million, -72%;
    • Net profit (loss): (USD168 million), compared to a profit of USD198 million in p-c-p;
    • Passenger traffic (RPMs): +0.3%;
    • Passenger load factor: 85.1%, +1.4 ppt;
    • Passenger yield: USD 16.73 cents, +6.8%;
    • Passenger revenue per ASM: USD 14.23 cents, +8.5%;
    • Operating cost per ASM: USD 16.16 cents, +12.1%;
  • Six months ended 30-Jun-2012:
    • Operating revenue: USD18,145 million, +7%;
    • Operating costs: USD17,629 million, +7%;
      • Fuel: USD5538 million, +15%;
      • Labour: USD3588 million, +4%;
    • Operating profit: USD516 million, +33%;
    • Net profit (loss): (USD44 million), compared to a loss of USD120 million in p-c-p;
    • Passenger traffic (RPMs): +0.6%;
    • Passenger load factor: 82.5%, +2.3 ppts;
    • Passenger yield: USD 16.70 cents, +7.7%;
    • Passenger revenue per ASM: USD 13.79 cents, +10.9%;
    • Operating cost per ASM: USD 15.49 cents, +9.2%;
    • Total assets: USD44,720 million, +2.8% when compared to period ended 31-Dec-2011;
    • Cash and cash equivalents: USD2539 million, -4.4% when compared to period ended 31-Dec-2011;
    • Total debt and capital leases: USD13,000 million, -5.7% when compared to period ended 31-Dec-2011;
  • 3Q2012 forecast:
    • Operating margin: 10% to 12%;
    • Capital expenditure: USD400 million to USD450 million;
    • Average fuel price: USD3.09;
    • Cost per ASM excl fuel and profit sharing: +5% to +6%;
    • Capacity (ASMs): -1% to -3%;

Delta: "While we are experiencing cost pressures in the near-term, we are implementing the structural initiatives, including the 717 transaction and Trainer refinery acquisition, needed to achieve better cost outcomes. We expect to begin realizing some of these benefits in the December quarter and into 2013," Paul Jacobson, CFO. Source: Company statement, 25-Jul-2012.

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