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Thursday, July 11, 2019

Delta Air Lines (DAL) reported earnings on Thur 11 July 19 (b/o)

** charts before earnings **


** charts after earnings **

Delta Air Lines beats by $0.07, reports revs in-line; guides Q3 EPS in-line; raises FY19 EPS and revenue; increases dividend 15%
  • Reports Q2 (Jun) earnings of $2.35 per share, $0.07 better than the S&P Capital IQ Consensus of $2.28; revenues rose 6.5% year/year to $12.54 bln vs the $12.49 bln S&P Capital IQ Consensus, a new quarterly record, with 52 percent of adjusted revenue from premium products and non-ticket sources; 2.3 points of operating margin expansion and $1.8 billion of free cash flow. Total unit revenue, adjusted, increased 3.8% (above 1.5-3.5% original guidance), driven by healthy growth in leisure and corporate revenue and an approximate one point benefit from the amended American Express agreement announced earlier this year.
  • Co issues in-line guidance for Q3, sees EPS of $2.10-2.40, excluding non-recurring items, vs. $2.16 S&P Capital IQ Consensus; unit revenue +1.5-3.5%, 
  • Co issues in-line guidance for FY19, raises EPS to $6.75-7.25 from $6-7, excluding non-recurring items, vs. $6.98 S&P Capital IQ Consensus; revenue growth to 6-7% from 4-6%. "With record passenger loads, customer satisfaction and $1 billion in revenue growth for the June quarter, demand for Delta's customer-focused product and service has never been stronger. Our third quarter is off to a great start with a new highest revenue day on record on July 7th," said Glen Hauenstein, Delta's president. "We now expect revenue growth of six to seven percent for the year, a $3 billion increase over 2018, as we benefit from our multi-year pipeline of fleet, product, and loyalty initiatives."
  • The Board of Directors today declared a quarterly dividend of $0.4025 per share, an increase of 15% over previous levels. This marks the sixth consecutive increase in Delta's dividend since it was established in 2013.
  • CEO Ed Bastian on CNBC: Results in the quarter are not one-off. Seeing some softness in Pacific and Atlantic but modest compared to overall strength in domestic business. Benefit from 737 MAX is marginal, domestic supply is down 1-2%.

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