Delta Air Lines Posts Adj. Loss In Q1; Revenue Recovery To Accelerate To 93-97% In Q2

(RTTNews) - Delta Air Lines (DAL, DALRQ.PK) posted an adjusted operating loss of $793 million and adjusted loss per share of $1.23, for the first quarter. Compared to the March quarter 2019, total passenger revenue was 75 percent recovered on system capacity that was 83 percent restored. Domestic passenger revenue was 83 percent recovered, and international passenger revenue was 54 percent restored in the March quarter.

On average, 17 analysts polled by Thomson Reuters expected the company to report a loss per share of $1.27, for the quarter. Analysts' estimates typically exclude special items.

First quarter net loss was $940 million or $1.48 per share. Operating revenue was $9.35 billion, for the quarter.

Adjusted operating revenue was $8.2 billion for the quarter, and was 79 percent restored to March quarter 2019 levels, 5 points ahead of the mid-point of the company's initial guidance. Analysts on average had estimated $8.92 billion in revenue.

At the end of the March quarter, the company had $12.8 billion in liquidity. At the end of the March quarter, the company had total debt and finance lease obligations of $25.6 billion with adjusted net debt of $20.9 billion.

With a strong rebound in demand as omicron faded, the company returned to profitability in the month of March, producing an adjusted operating margin of almost 10 percent.

"In the June quarter, we are successfully recapturing higher fuel prices and expect our revenue recovery to accelerate to 93 to 97 percent with unit revenue up double digits compared to 2019," said Glen Hauenstein, Delta's president.

The company also projects a 12 to 14 percent adjusted operating margin and strong free cash flow in the June quarter.

"As demand continues to recover and we restore additional capacity in the second half of the year, we expect our non-fuel unit cost comparisons to 2019 will improve to up mid-single digits, keeping us within our full year non-fuel unit cost guidance range. Reducing debt is our top financial priority as we target investment-grade metrics and $15 billion of adjusted net debt by the end of 2024," said Dan Janki, Delta's CFO.

Shares of Delta Air Lines were up 6% in pre-market trade on Wednesday.