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Delta profits take off as rivals suffer from B737 Max grounding

Annual profits at Delta Air Lines are set to soar by 20% as US airline rivals struggle with the grounding of Boeing 737 Max aircraft.

Delta, a part shareholder in Virgin Atlantic, flew a record 55.2 million passengers in the three months to September.

Revenues also broke records in the quarter to come in at $12.6 billion with adjusted pre-tax profit of $2 billion.

The airline does not operate the 737 Max which has been grounded since March following two crashes in Indonesia and Ethiopia killed a total of 346 people.

Delta saw fuel expenses drop by ten per cent or $249 million year-on-year in the peak three months of summer.

Referring to transatlantic routes, the airline said: “Premium cabin performance continues to outpace main cabin, where non-US point of sale demand has been impacted by uncertain economic outlook in the region.”

However, Delta is expanding transatlantic service in 2020, including Boston to Gatwick, Manchester and Rome.

Delta CEO Ed Bastian said: “Our powerful brand and competitive strengths drove another quarter of great results for our people, customers and owners.

“Our people bring our brand to life on every flight and I’m pleased to recognise their outstanding efforts with over $1 billion in profit sharing accrued so far this year.

“Demand for the Delta product remains healthy, positioning the company for a strong close to 2019 with expectations for more than 20% earnings growth, over $4 billion in free cash flow and a fifth year of pre-tax earnings over $5 billion.”

The carrier’s president Glen Hauenstein added: “Increased customer satisfaction is driving solid top-line performance – September quarter revenues grew to a record $12.6 billion and we expect December quarter revenues to grow more than five per cent versus prior year.

“Strong demand and our customer-focused commercial initiatives are putting us on track to achieve a $3 billion increase in revenues this year, a pace of growth well in excess of GDP.”

 

 

 

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