Delta Reports Much Higher Net Profit of $1.2 Billion for Third Quarter

Delta Air Lines, echoing the good financial results being recorded by most U.S. airlines, reported net profit for the September 2013 quarter of $1.2 billion, a $444 million improvement year-over-year. American Airlines reported a $350 million profit on Oct. 17.

Delta generated $1.2 billion of operating cash flow and $627 million of free cash flow in the September 2013 quarter, and ended the period with adjusted net debt of $9.9 billion. The airline’s operating revenue improved $567 million in the September 2013 quarter compared to the September 2012 quarter.

Traffic increased 2.1 percent on a 2.6 percent increase in capacity. Passenger revenue increased 6.7 percent, or $581 million, compared to the prior year period.  Passenger unit revenue (PRASM) increased 4 percent year over year with a 4.5 percent improvement in yield.

“Delta's outstanding financial results, operational performance and customer service this quarter reflect the hard work of 80,000 Delta employees worldwide," said Richard Anderson, Delta's CEO.  "These results reflect the progress we've made over the last five years, and we have even more exciting opportunities ahead of us as we build a better airline for our customers, employees and investors."

On the other hand, Delta’s total operating expense in the quarter increased $312 million year-over-year driven by higher volume- and revenue-related expenses; the impact of operational, service and employee investments; and $75 million higher profit sharing expense. These cost increases were partially offset by the savings from Delta's structural cost initiatives.  Non-operating expense declined as a result of lower interest expense and a $40 million benefit for the portion of Virgin Atlantic's September quarter profit attributable to Delta's ownership stake.

Source: Travel Pulse, http://www.travelpulse.com/delta-reports-much-higher-net-profit-of-12-billion-for-third-quarter.html