Even though Delta lost money in the first quarter, their stock still went up.
May 1, 2011- Delta Air Lines loss in the first quarter increased due to the higher fuel prices but was less than what most analysts had feared because of strong top line growth. Their stock responded to the news by increasing just over 2% to $9.15 a share.
Higher traffic in the first quarter of 2011 was reported by the airline due to higher international numbers as little by little air travel continues to rebound from the horrible numbers of the recent recession. The original plans to boost capacity this year have been changed and now they are expecting to cut by 2% from the levels of 2010 to offset the rising fuel costs and the crisis that hit Japan because of the earthquake.
Delta’s loss was $318 million for the quarter at $0.38 per share while last year’s same quarter was a loss of $256 million or $0.31 per share, but overall revenue was up to $7.75 billion or a 13% increase. Most forecasts had them losing about 50 cents a share on revenue just over $7.6 billion. One important figure to gauge for airlines is “passenger revenue per available seat mile” and that figure was up 7.3%.
They announced that both the harsh winter and the crisis in Japan impacted the company’s revenue by over $125 million. The airline’s president Ed Bastian is expecting double digit growth in revenue for the next quarter.
