Delta Air Lines has announced its March Quarter finance results and its updated 2023 outlook – marking a quarter loss but positive outlooks of increased revenue.
Delta Air Lines March results
Delta Air Lines has revealed its 2023 first-quarter results and a review of its full-year outlook. The airline reported revenue and earnings results in line with its previously issued guidance, however still lower than expectations, but also provided a positive outlook for the year.
The airline recorded an operating loss of 277 million USD. The reasons for this loss were given as increased operating costs, pay increases and more profit-sharing payments.
The company achieved operating revenue of 11.8 billion USD. This was an increase of 14% compared to the same quarter in 2019, a 45% increase to 2022. Revenue is often lower in the Winter seasons.
Its operating cash flow was almost 3 billion USD, a record result that the carrier stated enabled accelerated debt reduction. The carrier’s liquidity was reported as 9.5 billion USD and its adjusted net debt was 21 billion USD.
Ed Bastian, Delta’s Chief Executive Officer, said: “Thanks to the outstanding work and dedication of the Delta team, 2023 is off to a strong start. We provided well-deserved pay increases for our people and paid more profit sharing than the rest of the industry combined.”
Operationally, the carrier achieved on-time arrivals of 81% in the quarter, reportedly the most on-time among U.S. carriers. This was also reflected in the earning of the Cirium Platinum Award for global operational excellence as North America’s most on-time airline.
“Delta is building momentum, with the best people in the industry generating nearly $5 billion of operating profit over the last twelve months,” said Bastian.
Outlook for the Year
As reported by AviationSource, Delta has shown a steady increase in operations, year-on-year, since the pandemic. Showing a steady return to recovery and surpassing 2019 operations.
Looking ahead to the rest of 2023, the airline remains positive of its finances and operations. It reported record advanced bookings for 2023 summer. The March quarter advance cash bookings were around 20% higher on the same period in 2019.
Glen Hauenstein, Delta’s President, said: “We delivered record March quarter revenue…these results reflect the strength in the underlying demand environment and continued momentum in premium products and loyalty revenue.”
The company continues with its revenue diversification schemes, such as Premium and Loyalty products. Premium products and diverse revenue streams accounted for 56% of the airline’s adjusted operating revenue for the March quarter. This Premium revenue is also outgrowing main cabin products.
Hauenstein also added that it expected the June quarter results will show revenue to be 15 to 17% higher on capacity growth of 17%, year-on-year. This will be another record revenue quarter for the carrier.
On the matter of debt repayments, Dan Janki, Delta’s Chief Financial Officer, stated that the airline expected to achieve its full-year debt reduction early in the first half of 2023.
Janki also added: “We remain confident in our ability to deliver unit cost declines in the second half of 2023, while generating industry-leading operating margins of 10 to 12 percent for the full year.”
The Wall Street Journal in 2022 voted the carrier No. 1 in three of its seven categories for top U.S. airlines, including operations and fleet. In the quarter, Delta took delivery of six new aircraft including four Airbus A321NEO aircraft.
“With solid March quarter profitability and a strong outlook for the June quarter, we are confident in our full-year guidance,” Bastian concluded.