Leading U.S. passenger carrier
Delta Air Lines
) witnessed stagnancy in traffic in Mar 2013, due to lackluster
regional performance, partially offset by better results in Latin
The company's airline traffic - measured in revenue passenger
miles or RPMs, which implies revenue generated per mile per
passenger - remained nearly flat year over year at 16.5 billion.
Consolidated capacity (or available seat miles/ASMs) for the
month fell a marginal 0.6% from Mar 2012 to 19.4 billion.
The load factor or percentage of seats filled by passengers,
however, went up 60 basis points from the third month of 2012 to
84.7%. Passenger revenue per available seat mile (PRASM) improved
2.0% year over year, supported by efficient operations in the
Transatlantic region. The company registered a completion factor
of 99.3%, with nearly 84.9% of the flights on schedule.
For the first three months of 2013, Delta generated RPMs of 43.1
billion (down 0.6% year over year) and ASMs of 53.0 billion (down
2.6% year over year), while load factor was 81.2%, up 150 basis
Although traffic results for the first three months of 2013
failed to impress, Delta expects to witness a profitable first
quarter, with unit revenue growth of 4% to 4.5%. The present
forecast, however, is lower than the earlier guidance of 4.5% to
Operating margin expectation remains unchanged at 2.5% to 3.5%,
indicating an increase from the prior-year quarter. Although the
company expects non-fuel unit costs in the first quarter to
increase 5-6% year over year, the projection has improved from
the one given previously. Delta's consistent efforts to reform
its cost structure amid the present economic scenario seem to be
Delta - the second largest airline company in the U.S. after
United Continental Holdings Inc.
) - is in constant endeavor to expand its operational base and
provide better customer experience.
Last month, Delta expressed intentions of adding new flights
between the U.S. and Brazil, to capitalize on the growing market
demand between these routes. The company is also planning to
increase the number of flights at Los Angeles' international
airport with daily year-round and seasonal services.
Delta competes with the likes of
Southwest Airlines Co.
JetBlue Airways Corp.
) and carries a Zacks Rank #3, implying a Hold rating.
DELTA AIR LINES (DAL): Free Stock Analysis
JETBLUE AIRWAYS (JBLU): Free Stock Analysis
SOUTHWEST AIR (LUV): Free Stock Analysis
UNITED CONT HLD (UAL): Free Stock Analysis
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