Home / Business / RPT UPDATE 3-Delta Air Lines sales increase, but profit is dented by the fuel price, storms

RPT UPDATE 3-Delta Air Lines sales increase, but profit is dented by the fuel price, storms

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By Alana Wise

12. April (Reuters) – Delta Air Lines Inc. released quarterly results on Thursday that exceeded Wall Street's expectations in several key financials and an increase in holdings in companies and others in the industry in pre-market trading.

According to Thompson Reuters I / B / E / S, Delta's earnings per share were 77 cents, more than the analysts' average estimate of 73 cents per share. Atlanta-based airline stocks gained 2.7 percent before the US stock market opened.

The country's second largest airline in passenger traffic posted an increase in quarterly revenue of 9.5 percent, fueled by higher average fares and passenger traffic.

However, net income declined to $ 547 million in the first quarter ended March 31

, compared to $ 561 million a year ago, impacted by fuel price increases and a $ 44 million negative impact from severe winter storms.

Total revenue increased to $ 9.97 billion in the first quarter from $ 9.10 billion. The airline's total revenue, which compares sales with capacity, would increase 3 to 5 percent in the second quarter.

"We see Delta's best sales momentum since 2014, with positive domestic revenue reductions, improvements in all our international units, strong demand for business travel, and double-digit increases in customer loyalty," said Delta President Glen Hauenstein.

"We expect to maintain this momentum and achieve revenue growth of 4 to 6 percent for the full year."

Looking ahead to the second quarter, Delta expects a cost improvement and a reduction in the US corporate tax rate, mitigating the impact of rising fuel prices. The airline predicts an increase in quarterly unit cost excluding fuel and profit sharing from 1 percent to 3 percent compared to last year.

In the quarter ended March, Delta said operating expenses had increased $ 817 million sequentially, driven by higher fuel and labor costs and higher depreciation charges.

Nevertheless, Delta said it was still on track to achieve the target of a two-percent increase in total cost per year. (Report by Alana Wise in New York and Arunima Banerjee in Bengaluru, edited by Chizu Nomiyama and Bernadette Baum)

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