The North American airline Delta Air Lines recorded, in the first quarter, a net loss of 289 million dollars (247.13 million euros), affected by the sharp rise in fuel costs, despite the growth in revenue.
During this period, Delta Airlines recorded revenue of 15.9 billion dollars (13.60 billion euros), an increase of 13% compared to the previous year.
In mid-March, Chief Executive Ed Bastian had revised revenue forecasts upward, raising the range to 7% to 9% on comparable data, up from 5% to 7% previously, citing a significant increase in sales, particularly in March.
Sales were driven by the “premium, corporate and loyalty” segments, indicates the group.
On the other hand, the net result fell by 529 million dollars (452.53 million euros), moving into the red with a loss of 289 million dollars.
In the second quarter, the group forecasts a pre-tax profit of “around US$1 billion (855 million euros)”, despite an increase of more than US$2 billion (1.71 billion euros) in fuel expenses.
“While the recent rise in fuel prices is currently weighing on results, I am convinced that this environment ultimately reinforces Delta’s leadership and accelerates its long-term profitability,” Ed Bastian said in a statement.
These numbers demonstrate “the solidity of the economic model” of Delta Air Lines, analysts at TD Cowen estimate in a note.
The airline has the distinction of having its own refinery.
Expenses related to the refinery increased by 56% and those related to fuel and related fees increased by 14%.
The company had already indicated that the increase in fuel prices, associated with the conflict in the Middle East, had led to an additional cost estimated at 400 million dollars in March.
“Our integrated fuel strategy constitutes a unique element of differentiation, as the profitability of our refinery partially offsets the increase in refining margins, at current prices, the refinery should bring a benefit of 300 million dollars for the second quarter”, highlighted in the statement Dan Janki, who was financial director of Delta Air Lines until the end of March.
On Tuesday, an agreement was reached between Iran and the United States on a two-week ceasefire in exchange for the reopening of the Strait of Hormuz, blocked by Tehran since the beginning of American and Israeli attacks at the end of February.
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