Delta raises 2019 profit outlook on
strong demand as rivals grapple with Boeing 737 Max grounding
PUBLISHED THU, JUL 11 2019 7:01 AM EDTUPDATED
THU, JUL 11 2019 2:53 PM EDT
KEY POINTS:
·
Delta posted record revenue of $12.5 billion and
per-share profits of $2.35 in the second quarter.
·
Analysts expected per-share earnings of $2.28 in
the three months ended in June.
·
The airline is benefiting as its competitors
grapple with the grounded Boeing 737 Max, which Delta’s doesn’t fly.
Delta Air
Lines shares rose Thursday after the Atlanta-based carrier raised its
profit forecast for the year as travel demand continues to climb, particularly
for its premium-class cabins. Its CEO said the airline is also benefiting from
the grounding of competitors’ Boeing 737 Max planes.
Delta expects to earn $6.75 to $7.25 per share this year, up
from a previous estimate of $6 to $7 a share. Its stock was up 1.5% in
afternoon trading.
Delta doesn’t operate the Boeing 737 Max, which has been
grounded worldwide since mid-March following two fatal crashes that claimed a
total of 346 lives.
“We do not fly the Max and clearly there was a benefit to
the airline in the quarter,” Delta’s CEO Ed Bastian told CNBC’s Squawk Box on Thursday,
calling the boost “marginal.”
Competitors American, Southwest and United have canceled
thousands of flights throughout the busy summer travel period and removed the
737 Max from their schedules through the end of the season as the plane remains
grounded. Regulators have not indicated when they will allow the planes to fly
again.
“It’s taken longer than any of us expected to see it return
to service,” Bastian said. “We don’t have a crystal ball on that.”
American Airlines on Wednesday said the Max grounding likely
cost it $185
million in pretax income in the second quarter, but as a result raised
its forecast for revenue per seat mile, a measure of how much an airline is
making for every seat it flies one mile, to an increase of 3% to 4% from the
April to June period of 2018, up from its previous forecast for growth of
between 1% and 3%.
American’s flying in the three months ended June 30 fell
about 0.8% from the second quarter of 2018, as it had to cancel 7,800 flights,
American said. Delta, on the other hand, expanded flying by close to 5% from a
year earlier.
Delta’s second-quarter profit rose about 30% from a year ago
and topped analysts’ expectations, as demand for travel, particularly for
premium-class cabins and corporate travel drove its earnings higher.
Delta passengers have shown they are willing
to pay more for seats on the airline. Travelers are buying 65% and 70%
of seats in first class cabins, Bastian said. That’s up from about 13% for
domestic routes in 2011.
Delta’s revenue from premium seats, which include seats with
extra legroom and premium economy as well as business and first, rose 10% in
the second quarter to $4 billion, twice as fast as revenue from the main cabin,
which came in at $5.9 billion.
Delta posted a per-share profit of $2.35, on an adjusted
basis, on record revenue of $12.5 billion, which roughly in line with
estimates. Higher revenue from premium cabins and corporate travel helped drive
sales higher, the airline said. Net income rose to $1.4 billion from $1.04
billion in the April-June quarter of 2018.
Delta expects earnings per share of $2.10 to $2.40 in the
third quarter. Analysts expected third-quarter per-share earnings of $2.18.
United Airlines will be the next carrier to report results
on July 16. American and Southwest report at the end of the month.
+++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
Biz Cards
Date: 6/26/2019 11:18:43 PM
Mark,
I told Pete that biz cards for us retired guys are available
from Staples. Just take an old card and tell them what you want to change. They
charged us $10 for 250 cards and a small setup fee.
Bill Rodway
+++++++++++++++++++++++++++++++++++++++++++
From: David L. Roberts
Date: 8/1/2019 8:32:49 PM
Subject: EQUATOR
LINE DISPLAY
Thanks to Captain Alan in
Connecticut for sending this interesting video. I know most of you have
experienced this phenomenon but had no idea that it could be experienced in
such a small area. Dave
EQUATOR LINE
Interesting if you have not seen this.
As most of us know, the equator line passes through Kenya and Tanzania.
Below is an experiment displayed to tourists in Tanzania.
See how precisely the earth's rotational force works, just a few feet apart.
Interesting if you have not seen this.
As most of us know, the equator line passes through Kenya and Tanzania.
Below is an experiment displayed to tourists in Tanzania.
See how precisely the earth's rotational force works, just a few feet apart.
+++++++++++++++++++++++++++++++++++++++++++
From: Julian Black
Date: 7/22/2019 11:03:54 PM
To: Julian Black
Subject: 2020 nominees to the Georgia Aviation Hall Of Fame
Well, this is interesting...
What is different this year is voting is open to everyone.
Previously only "electors' could chose.
There are ten nominees. How many they will induct and who
seems to be somewhat capricious. Last year there were twelve, and they said
they would induct four. But, only three were inducted, two from the list and
another, Delta Capt. Topshe, from a
prior year.
So, here is where you go to vote. The instructions are
straight forward, but voting is only open till Aug 3rd. Then the site will
disappear.
UPDATE: VOTE HAS NOW
CLOSED as of Aug 3rd!!! Someone please
report back the vote results when you get a chance!!!
Feel free to share this info with anyone you might feel is
interested.
PS: Jim Hoogerwerf
is on the list and goes to our breakfast at J,R’s and J. Christopher’s.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Full post disclaimer in left column. PCN Home Page is located at: http://pcn.homestead.com/home01.html
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