ATLANTA, Oct. 2, 2015 /PRNewswire/ -- Delta Air Lines
(NYSE: DAL) today reported financial and operating performance for
September 2015.
Consolidated passenger unit revenue (PRASM) for the month of
September declined 5.0% year over year, consistent with recent
trends of pressure from foreign exchange, lower surcharges in
international markets, and domestic yields.
In an Investor Update issued this morning, Delta announced that
it expects its operating margin to be 20% - 21% and its unit
revenue to decline 4.5% - 5.5% for the September quarter. Both of
these results are on the favorable end of initial guidance ranges
provided by the company in July.
The company's financial and operating performance is detailed
below.
Preliminary
Financial and Operating Results
|
September
consolidated PRASM change year over year
|
(5.0%)
|
Projected September
quarter fuel price per gallon, adjusted
|
$1.80 -
$1.85
|
September mainline
completion factor
|
100.0%
|
September on-time
performance (preliminary DOT A14)
|
90.5%
|
- Note: Projected fuel price of $1.80 -
$1.85 includes taxes, transportation, settled hedges, hedge
premiums and refinery contribution and is adjusted for MTM
adjustments and settlements.
Delta Air Lines serves more than 170 million customers each
year. Delta was named to FORTUNE magazine's top 50 World's Most
Admired Companies in addition to being named the most admired
airline for the fourth time in five years. Additionally, Delta has
ranked No.1 in the Business Travel News Annual Airline survey for
four consecutive years, a first for any airline. With an
industry-leading global network, Delta and the Delta Connection
carriers offer service to 318 destinations in 58 countries on six
continents. Headquartered in Atlanta, Delta employs nearly 80,000 employees
worldwide and operates a mainline fleet of more than 700 aircraft.
The airline is a founding member of the SkyTeam global alliance and
participates in the industry's leading trans-Atlantic joint venture
with Air France-KLM and Alitalia as well as a joint venture with
Virgin Atlantic. Including its worldwide alliance partners, Delta
offers customers more than 15,000 daily flights, with key hubs and
markets including Amsterdam, Atlanta, Boston, Detroit, Los Angeles,
Minneapolis/St. Paul, New York-JFK, New York-LaGuardia,
Paris-Charles de Gaulle, Salt Lake City, Seattle and Tokyo-Narita.
Delta has invested billions of dollars in airport facilities,
global products and services, and technology to enhance the
customer experience in the air and on the ground. Additional
information is available on the Delta News Hub, as well as
delta.com, Twitter @DeltaNewsHub, Google.com/+Delta,
Facebook.com/delta and Delta's blog takingoff.delta.com..
Forward Looking Statements
Statements in this press release that are not historical facts,
including statements regarding our estimates, expectations,
beliefs, intentions, projections or strategies for the future, may
be "forward-looking statements" as defined in the Private
Securities Litigation Reform Act of 1995. All forward-looking
statements involve a number of risks and uncertainties that could
cause actual results to differ materially from the estimates,
expectations, beliefs, intentions, projections and strategies
reflected in or suggested by the forward-looking statements.
These risks and uncertainties include, but are not limited
to, the cost of aircraft fuel; the availability of aircraft fuel;
the impact of rebalancing our hedge portfolio, recording
mark-to-market adjustments or posting collateral in connection with
our fuel hedge contracts; the possible effects of accidents
involving our aircraft; the restrictions that financial covenants
in our financing agreements will have on our financial and business
operations; labor issues; interruptions or disruptions in service
at one of our hub or gateway airports; disruptions or security
breaches of our information technology infrastructure; our
dependence on technology in our operations; the effects of weather,
natural disasters and seasonality on our business; the effects of
an extended disruption in services provided by third party regional
carriers; failure or inability of insurance to cover a significant
liability at Monroe's Trainer
refinery; the impact of environmental regulation on the Trainer
refinery, including costs related to renewable fuel standard
regulations; our ability to retain management and key employees;
competitive conditions in the airline industry; the effects of
extensive government regulation on our business; the sensitivity of
the airline industry to prolonged periods of stagnant or weak
economic conditions; the effects of terrorist attacks or
geopolitical conflict; and the effects of the rapid spread of
contagious illnesses.
Additional information concerning risks and uncertainties that
could cause differences between actual results and forward-looking
statements is contained in our Securities and Exchange Commission
filings, including our Annual Report on Form 10-K for the fiscal
year ended Dec. 31, 2014.
Caution should be taken not to place undue reliance on our
forward-looking statements, which represent our views only as of
October 2, 2015, and which we have no
current intention to update.
Non-GAAP Financial Measures
Delta sometimes uses information ("non-GAAP financial measures")
that is derived from the Consolidated Financial Statements, but
that is not presented in accordance with accounting principles
generally accepted in the U.S. ("GAAP"). Under the U.S. Securities
and Exchange Commission rules, non-GAAP financial measures may be
considered in addition to results prepared in accordance with GAAP,
but should not be considered a substitute for or superior to GAAP
results. The tables below show reconciliations of non-GAAP
financial measures used in this release to the most directly
comparable GAAP financial measures.
Operating Margin, adjusted for special items
Delta adjusts for the following items to determine operating
margin, adjusted for special items, for the reasons described
below:
- MTM adjustments and settlements. MTM adjustments and
settlements. MTM adjustments are defined as fair value changes
recorded in periods other than the settlement period. Such fair
value changes are not necessarily indicative of the actual
settlement value of the underlying hedge in the contract settlement
period. Settlements represent cash received or paid on hedge
contracts settling during the period. These items adjust fuel
expense to show the economic impact of hedging, including cash
received or paid on hedge contracts during the period. Adjusting
for these items allows investors to better understand and analyze
the company's core operational performance in the periods
shown.
- Refinery Sales. Delta's refinery segment provides jet
fuel to the airline segment from its own production and from jet
fuel obtained through agreements with third parties. Activities of
the refinery segment are primarily for the benefit of the airline.
However, from time to time, the refinery sells fuel by-products to
third parties. These sales are recorded gross within other revenue
and other operating expense. We believe adjusting for refinery
sales allows investors to better understand and analyze the impact
of fuel cost on our results in the periods shown.
|
|
|
|
(Projected)
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
September 30,
2015
|
|
Operating
margin
|
|
|
18.7% to
20.1%
|
|
Adjusted
for:
|
|
|
|
|
MTM adjustments and settlements
|
1.1% to
0.7%
|
|
Refinery sales
|
|
|
0.2%
|
|
Operating margin,
adjusted
|
|
20% to 21%
|
|
Average Fuel Price Per Gallon, Adjusted
Delta adjusts for mark-to-market adjustments and settlements to
determine average price per fuel gallon, adjusted. MTM adjustments
are defined as fair value changes recorded in periods other than
the settlement period. Such fair value changes are not necessarily
indicative of the actual settlement value of the underlying hedge
in the contract settlement period. Settlements represent cash
received or paid on hedge contracts settling during the period.
These items adjust fuel expense to show the economic impact of
hedging, including cash received or paid on hedge contracts during
the period. Adjusting for these items allows investors to better
understand and analyze the company's core operational performance
in the period shown.
|
|
|
(Projected)
|
|
|
|
Three Months
Ended
|
|
|
|
September 30,
2015
|
Average fuel price
per gallon
|
$1.95 to
$1.90
|
MTM adjustments and
settlements
|
|
|
(0.15) to
(0.05)
|
Average fuel price
per gallon, adjusted
|
$1.80 to
$1.85
|
|
|
|
Monthly Traffic
Results (a)
|
|
|
Year to Date
Traffic Results (a)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sep
2015
|
|
Sep
2014
|
|
Change
|
|
|
Sep
2015
|
|
Sep
2014
|
|
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RPMs
(000):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Domestic
|
10,035,472
|
|
9,601,070
|
|
4.5%
|
|
|
95,101,878
|
|
90,875,786
|
|
4.7%
|
|
|
|
Delta
Mainline
|
8,385,924
|
|
7,909,592
|
|
6.0%
|
|
|
79,479,519
|
|
74,724,454
|
|
6.4%
|
|
|
|
Regional
|
1,649,548
|
|
1,691,478
|
|
(2.5%)
|
|
|
15,622,359
|
|
16,151,332
|
|
(3.3%)
|
|
|
International
|
7,321,450
|
|
7,351,110
|
|
(0.4%)
|
|
|
64,946,334
|
|
64,021,155
|
|
1.4%
|
|
|
|
Latin
America
|
1,195,127
|
|
1,215,692
|
|
(1.7%)
|
|
|
14,704,012
|
|
13,826,477
|
|
6.3%
|
|
|
|
Delta
Mainline
|
1,159,518
|
|
1,192,420
|
|
(2.8%)
|
|
|
14,409,358
|
|
13,553,224
|
|
6.3%
|
|
|
|
Regional
|
35,609
|
|
23,272
|
|
53.0%
|
|
|
294,654
|
|
273,253
|
|
7.8%
|
|
|
|
Atlantic
|
4,046,855
|
|
4,040,995
|
|
0.1%
|
|
|
31,679,123
|
|
31,428,637
|
|
0.8%
|
|
|
|
Pacific
|
2,079,467
|
|
2,094,423
|
|
(0.7%)
|
|
|
18,563,199
|
|
18,766,041
|
|
(1.1%)
|
|
|
Total
System
|
17,356,922
|
|
16,952,180
|
|
2.4%
|
|
|
160,048,212
|
|
154,896,941
|
|
3.3%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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|
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|
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|
ASMs
(000):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Domestic
|
11,827,294
|
|
11,581,895
|
|
2.1%
|
|
|
110,717,052
|
|
106,059,831
|
|
4.4%
|
|
|
|
Delta
Mainline
|
9,759,428
|
|
9,390,616
|
|
3.9%
|
|
|
91,310,199
|
|
85,816,029
|
|
6.4%
|
|
|
|
Regional
|
2,067,866
|
|
2,191,279
|
|
(5.6%)
|
|
|
19,406,853
|
|
20,243,802
|
|
(4.1%)
|
|
|
International
|
8,602,308
|
|
8,661,089
|
|
(0.7%)
|
|
|
77,846,819
|
|
75,586,862
|
|
3.0%
|
|
|
|
Latin
America
|
1,471,681
|
|
1,510,604
|
|
(2.6%)
|
|
|
17,742,888
|
|
16,509,861
|
|
7.5%
|
|
|
|
Delta
Mainline
|
1,426,257
|
|
1,477,645
|
|
(3.5%)
|
|
|
17,368,145
|
|
16,148,605
|
|
7.6%
|
|
|
|
Regional
|
45,424
|
|
32,959
|
|
37.8%
|
|
|
374,743
|
|
361,256
|
|
3.7%
|
|
|
|
Atlantic
|
4,681,526
|
|
4,541,229
|
|
3.1%
|
|
|
38,490,318
|
|
36,803,262
|
|
4.6%
|
|
|
|
Pacific
|
2,449,102
|
|
2,609,256
|
|
(6.1%)
|
|
|
21,613,613
|
|
22,273,739
|
|
(3.0%)
|
|
|
Total
System
|
20,429,603
|
|
20,242,984
|
|
0.9%
|
|
|
188,563,871
|
|
181,646,693
|
|
3.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Load
Factor:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Domestic
|
84.9%
|
|
82.9%
|
|
2.0
|
pts
|
|
85.9%
|
|
85.7%
|
|
0.2
|
pts
|
|
|
Delta
Mainline
|
85.9%
|
|
84.2%
|
|
1.7
|
pts
|
|
87.0%
|
|
87.1%
|
|
(0.1)
|
pts
|
|
|
Regional
|
79.8%
|
|
77.2%
|
|
2.6
|
pts
|
|
80.5%
|
|
79.8%
|
|
0.7
|
pts
|
|
International
|
85.1%
|
|
84.9%
|
|
0.2
|
pts
|
|
83.4%
|
|
84.7%
|
|
(1.3)
|
pts
|
|
|
Latin
America
|
81.2%
|
|
80.5%
|
|
0.7
|
pts
|
|
82.9%
|
|
83.7%
|
|
(0.8)
|
pts
|
|
|
Delta
Mainline
|
81.3%
|
|
80.7%
|
|
0.6
|
pts
|
|
83.0%
|
|
83.9%
|
|
(0.9)
|
pts
|
|
|
Regional
|
78.4%
|
|
70.6%
|
|
7.8
|
pts
|
|
78.6%
|
|
75.6%
|
|
3.0
|
pts
|
|
|
Atlantic
|
86.4%
|
|
89.0%
|
|
(2.6)
|
pts
|
|
82.3%
|
|
85.4%
|
|
(3.1)
|
pts
|
|
|
Pacific
|
84.9%
|
|
80.3%
|
|
4.6
|
pts
|
|
85.9%
|
|
84.3%
|
|
1.6
|
pts
|
|
Total
System
|
85.0%
|
|
83.7%
|
|
1.3
|
pts
|
|
84.9%
|
|
85.3%
|
|
(0.4)
|
pts
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mainline
Completion Factor
|
|
|
100.0%
|
|
99.8%
|
|
0.2
|
pts
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Passengers
Boarded
|
|
|
14,549,282
|
|
13,931,141
|
|
4.4%
|
|
|
135,158,780
|
|
129,554,616
|
|
4.3%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cargo Ton Miles
(000):
|
|
|
182,219
|
|
207,969
|
|
(12.4%)
|
|
|
1,655,023
|
|
1,759,128
|
|
(5.9%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
aResults
include flights operated under contract carrier
arrangements
|
Logo - http://photos.prnewswire.com/prnh/20090202/DELTALOGO
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/delta-reports-financial-and-operating-performance-for-september-2015-300153100.html
SOURCE Delta Air Lines