Delta July Traffic Improves - Analyst Blog


Leading passenger and cargo carrier Delta Air Lines ( DAL ) reported growth in traffic for Jul 2013 on strong contributions from Latin America and Atlantic regions.

The company's airline traffic - measured in revenue passenger miles or RPMs, which implies revenue generated per mile per passenger - moved up 1.7% year over year to 19.4 billion. Consolidated capacity (or available seat miles/ASMs) for the month increased 2.7% from Jul 2012 to 22.3 billion.

The load factor or percentage of seats filled by passengers, however, declined 80 basis points from the seventh month of 2012 to 87.0%. Passenger revenue per available seat mile (PRASM) improved 3.0% year over year, aided by the well-performing trans-Atlantic markets. The company registered a completion factor of 99.5%, with nearly 74.5% of its flights on schedule.

For the first seven months of 2013, Delta generated RPMs of 113.3 billion (up 0.3% from the corresponding period, last year) and ASMs of 135.2 billion (down 0.2% year over year), while load factor was 83.8%, up 40 basis points.

On Jul 24, Delta - the second largest airline company in the U.S. after United Continental Holdings Inc. ( UAL ) - reported second-quarter 2013 adjusted earnings of 98 cents, surpassing the Zacks Consensus Estimate of 95 cents. The results also improved considerably from the year-ago adjusted earnings of 69 cents. The company's performance was buoyed by strong sales along with operational efficiency and growing demand.

We expect the company to be well positioned over the coming months owing to various strategic initiatives such as route launches, renovation of airport terminals, revamping of fleet structures and profitable acquisitions. Recently, Delta revealed plans to expand its services by launching nonstop seasonal flights to Aspen, Colo. Apart from daily services from Atlanta, there will also be flights every Saturday from Minneapolis-St. Paul.

Delta operates with the likes of Southwest Airlines Co. ( LUV ) and JetBlue Airways Corp. ( JBLU ) and carries a Zacks Rank #3 (Hold).

DELTA AIR LINES (DAL): Free Stock Analysis Report

JETBLUE AIRWAYS (JBLU): Free Stock Analysis Report

SOUTHWEST AIR (LUV): Free Stock Analysis Report

UNITED CONT HLD (UAL): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ, Inc.

This article appears in: Investing , Business , Stocks

Referenced Stocks: DAL , JBLU , LUV , UAL

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