Delta Air Lines has reported financial results for the September quarter of 2022 and provided its outlook for the December quarter of 2022. The airline expects to post another profit in the last quarter of the year and said that both leisure and business travel continues to recover.
Glen Hauenstein, Delta's president, said: "With corporate travel improving and robust domestic and international demand, we expect December quarter revenue to be up 5 to 9% compared to December quarter 2019."
Delta reported a net income of $695 million, or $1.08 per share, on record revenue of close to $14bn, due to strong summer coupled with high fares, at the end of the third quarter. Adjusting for one-time items, Delta posted earnings per share of $1.51, while adjusted revenue came in at $12.8 billion, 3% above 2019 levels, despite a smaller schedule.
Dan Janki, Delta's chief financial officer, said: “We delivered $1.5bn of operating profit with a 12% operating margin in the September quarter despite costs related to our rebuild efforts as well as inflationary impacts felt across the industry. With capacity expected to be 91 to 92% restored to 2019 in the December quarter, improving asset utilization and efficiency remain key priorities as we move into the final stages of rebuilding the airline and work to drive a competitive cost structure."
"We reached a major milestone this quarter, with adjusted revenue 3% higher and unit revenues up 23% compared to 2019, marking the highest revenue and unit revenue quarter in Delta's history. Our results reflect the strength of our brand and diverse revenue streams, with another quarter of record co-brand remuneration and continued premium product outperformance," added Glen.
Delta charts showed a rise in domestic passenger revenue by 2% higher and international passenger revenue by 97% as compared to the September quarter of 2019. International unit revenue growth outpaced domestic for the first time since the pandemic.
Ed Bastian, Delta's chief executive officer, said: “The travel recovery continues as consumer spending shifts to experiences and demand improves in corporate and international. In this environment, we expect December quarter revenue growth to accelerate versus 2019 with an operating margin of approximately 10%."
"With strong demand and a return to best-in-class operational performance, we are ahead of our plan for the year on profitability and expect to be free cash flow positive. We're working towards full network restoration by the summer of 2023, which supports a meaningful step up in profitability and cash flow next year on our path to earn over $7 of EPS and $4 billion of free cash flow in 2024," Bastian added.
Delta repaid $1.8bn of debt during the quarter, bringing year-to-date debt repayment to more than $4bn with an operating expense of $12.5bn and a total adjusted operating expense of $11.3bn at the end of the September quarter.