Delta 3Q profit surges on fuel contract gains
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Delta Air Lines said Wednesday, Oct. 24, 2012, that its third-quarter profit nearly doubled mostly due to the increasing value of its fuel contracts. Associated Press |
NEW YORK — Delta Air Lines said Wednesday that its third-quarter profit nearly doubled mostly due to the increasing value of its fuel contracts.
The world's second-largest airline earned $1.05 billion, or $1.23 per share, compared with $549 million, or 65 cents, a year earlier. Excluding one-time items, it earned $768 million or 90 cents — just shy of Wall Street expectations of 91 cents.
Revenue rose 1 percent to $9.92 billion, also just under analysts' estimate of $9.93 billion, according to FactSet. The Atlanta-based airline says revenue was driven by its effort to trim seats according to demand. As it scaled back capacity, flights were slightly fuller.
Delta made 3 percent more per passenger in the third quarter, which includes a bulk of the peak summer season but also incorporates one of the weakest months — September. Traffic at all the big airlines fell last month.
But Delta is eyeing a per-passenger revenue improvement of 4 percent to 5 percent in October, well above the 0.5 increase in September.
Fuel costs dropped 23 percent in the third-quarter. Overall, operating expenses fell 4 percent. Other expenses related to items like debt and interest fell 18 percent.
Southwest Airlines said last week it squeezed out a small third-quarter profit in spite of a September slowdown. United Continental Holdings Inc., the parent of United Airlines, reports third-quarter results on Thursday.
