06-Sep-2010 4:16 PM

Delta Air Lines traffic stable; Republic Airways benefits again from Frontier purchase

North American airline stocks made strong advances on Friday (03-Sep-2010) after the Dow (+1.2%) was boosted by news US jobs declined much less than expected for Aug-2010.

The rise in airline stocks was despite a 1.5% rise in oil prices for the day, to USD75.02. The AMEX Airline Index ended trading up 0.8%.

Delta Air Lines traffic stable for Aug-2010

Delta Air Lines (+1.9%) was one of the biggest gainers for the day, after reporting a 0.3% year-on-year increase in passenger numbers for Aug-2010, to 15.2 million.

Load factor for the month was stable, at 86.5%, as traffic (RPMs) rose 1.1% on a 1.2% increase in capacity. During the period, domestic load factor declined 1.0 ppts, to 85.8%. However, international load factor was up 1.3 ppts, to 87.4%, led by a 4.5 ppt rise in trans-Atlantic loads, to 87.7%. Cargo ton miles meanwhile rose 26.6% for the month, to 193 million.

See related CAPA Profile: Traffic and Capacity

American Airlines load factor slips

American Airlines (+0.6%) made a modest gain after reporting a 0.1% year-on-year decline in passenger numbers for Aug-2010, to 7.7 million. More positively, subsidiary, American Eagle reported a 0.1% improvement in passenger numbers for the month, to 1.7 million.

American’s load factor for Aug-2010 declined 0.1 ppts, to 84.6%, as the carrier’s increase in capacity (ASMs) outweighed the 3.1% rise in traffic (RPMs). The improvement in traffic was the result of a 7.1% rise in international traffic for the period, while domestic traffic rose only 0.6%. Asia Pacific traffic rose the most for the month, up 21.4%.

Cargo also improved for the month, with cargo ton miles gaining 13.5%, to 156 million.

See related CAPA Profile: Air Freight

Republic Airways traffic benefits again from Frontier purchase

Republic Airways (-0.1%) slipped despite passenger numbers rising 70% year-on-year, to 3.0 million, following its acquisition of Frontier Airlines and Midwest Airlines. Load factor for the month was up 4.0 ppts, to 84%, as a rise in traffic (+120%) outweighed the increase in capacity (+109%).

Frontier Airlines accounted for approximately three-fifths of the group’s traffic for the month. Frontier branded operations generated a 10% rise in traffic, as capacity increased 9%. Frontier also reported a record load factor for the sixth consecutive month. The load factor in Aug-2010 of 88% compared to 87% in August 2009. Frontier served 1.4 million passengers last month, a 5% increase.

Elsewhere, US Airways (+3.3%) stock gained after the carrier reported a 15% year-on-year rise in passenger revenue per ASM and a 15% rise in revenue per ASM for Aug-2010 the day prior. AirTran (+2.4%) was also up.

Latin American carriers GOL (-1.7%), LAN Airlines (-1.0%) and TAM (-0.5%) fell for the session, despite gains in wider markets, mirroring rises in the US.

North & South America selected airlines daily share price movements (% change): 03-Sep-2010