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Delta Airlines records $45.6bn revenue in 2022

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Delta Airlines has announced that it recorded $45.6bn revenue in profit for the year ended 2022.

This was disclosed by Glen Hauenstein, the President, Delta Air Lines in a statement on the airline’s financial report for the year ended 2022.

“Industry-leading operations and the best-in-class service our people provided drove strong customer satisfaction scores and increasing brand preference in 2022,” Hauenstein said,

He explained that the airlines delivered $45.6 billion in adjusted revenue, a $19 billion increase over the prior year, with record unit revenue performance expected to sustain a revenue premium to the industry of more than 110 percent.

“Momentum continues in 2023 with strong demand trends, and we expect March quarter adjusted revenue to be 14 to 17 percent higher than 2019 on capacity that is one percent lower,” he said.

According to the report, operating revenue of $45.6 billion, is two percent lower than the full year 2019 and operating income of $3.6 billion with an operating margin of 7.8 percent

The airline recorded pre-tax income of $2.7 billion with a pre-tax margin of 5.9 percent, earnings per share of $3.20, operating cash flow of $6.2 billion, free cash flow of $244 million and $9.4 billion in liquidity and adjusted net debt of $22.3 billion at year end.

This includes cash and cash equivalents, short-term investments and undrawn revolving credit facilities

“Delta people rose to the challenges of 2022, delivering industry-leading operational reliability and financial performance, and I’m looking forward to recognizing their achievements with over $500 million in profit-sharing payments next month,” said Ed Bastian, Delta’s chief executive officer.

“As we move into 2023, the industry backdrop for air travel remains favourable and Delta is well positioned to deliver significant earnings and free cash flow growth. We expect to grow 2023 revenue by 15 to 20 percent and improve unit costs year-over-year, supporting a full-year outlook for earnings of $5 to $6 per share and keeping us on track to achieve more than $7 of earnings per share in 2024.”

For December Quarter 2022, adjusted financial results, the airline recorded operating revenue of $12.3 billion, eight percent higher than the December quarter 2019; operating income of $1.4 billion with an operating margin of 11.6 percent, pre-tax income of $1.2 billion with a pre-tax margin of 10.1 percent, earnings per share of $1.48 and operating cash flow of $1.2 billion.

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Strong demand through the quarter drove domestic total passenger revenue seven percent higher versus December quarter 2019, with International passenger revenue up five percent.

Domestic corporate sales in the December quarter were 80 percent recovered to 2019 levels. Recent corporate survey results indicate that 96 percent of companies expect their travel will stay the same or increase sequentially in the March quarter.

Premium revenue was up 13 percent in the December quarter versus 2019, 8 points higher than main cabin revenue growth.

Corporate sales include tickets sold to corporate contracted customers, including tickets for travel during and beyond the referenced time period.

Remuneration for the December quarter was $1.5 billion, approximately 40 percent higher than the December quarter 2019 and was approximately $5.5 billion for the full year 2022, exceeding our initial target of $5 billion. Co-brand card spend was up 45 percent compared to the December quarter 2019 with co-brand card acquisitions exceeding 2019 levels.

“With a step up in capacity restoration, we reported sequential improvement in December quarter unit cost performance. In 2023, we are confident in completing our network rebuild and delivering the benefits of scale and efficiency as we move through the year, resulting in a two to four percent decline in non-fuel unit costs year-over-year, including all expected labor cost increases,” Dan Janki, Delta’s chief financial officer said.

“For the March quarter, we expect non-fuel unit costs to increase 3 to 4 percent year-over-year, including a full quarter impact from labor cost increases and finalizing the rebuild of our network for the peak summer period. Our outlooks for the March quarter and full year are consistent with our cost framework provided to investors on December 14, updated for all expected labor cost increases,” Janki said.

For the December quarter, the airline recorded an operating expense of $12.0 billion and total adjusted operating expense of $10.9 billion.

December quarter adjusted non-fuel costs of $7.8 billion. December quarter non-fuel CASM was 13 percent higher than the December quarter 2019 on nine percent less capacity, including a 1 point impact from severe winter weather.