Delta Airlines records $783m loss in first quarter 2022

Delta Airlines has reported an operating loss of $783 million and loss per share of $1.48 on total operating revenue of $9.3 billion for the first quarter 2022.

However, with an improving demand environment, the airline achieved a solid operating margin in the month of March.

“With a strong rebound in demand as omicron faded, we returned to profitability in the month of March, producing a solid adjusted operating margin of almost 10 percent.

“As our brand preference and demand momentum grow, we are successfully recapturing higher fuel prices, driving our outlook for a 12 percent to 14 percent adjusted operating margin and strong free cash flow in the June quarter,” Ed Bastian, Delta’s chief executive officer said.

“I would like to thank the Delta people, who once again enabled our best-in-class operational performance, provided an unmatched customer experience and continue to power our industry leadership each and every day.”

Total operating expense of $10.1 billion increased $679 million compared to the March quarter 2019.

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The airline adjusted for costs primarily from third-party refinery sales, total operating expense of $9.0 billion decreased $400 million or four percent in the March quarter 2022 versus the comparable 2019 period.

It generated $1.8 billion of operating cash flow and $197 million of free cash flow, after investing $1.6 billion into the business, primarily related to aircraft purchases and modifications.

At the end of the March quarter, the company had $12.8 billion in liquidity, including cash and cash equivalents, short-term investments and undrawn revolving credit facilities.

The airline disclosed that all forward-looking statements involve a number of risks and uncertainties that could cause actual results to differ materially from the estimates, expectations, beliefs, intentions, projections, goals, aspirations, commitments and strategies reflected in or suggested by the forward-looking statements.

These risks and uncertainties according to the airline include, but are not limited to, the material adverse effect that the COVID-19 pandemic has had on its business; the impact of incurring significant debt in response to the pandemic; failure to comply with the financial and other covenants in its financing agreements.

Other risks it mentioned include the possible effects of accidents involving our aircraft or aircraft of the airline partners; breaches or lapses in the security of technology systems on which it rely; disruptions in its information technology infrastructure; dependence on technology in its operations; commercial relationships with airlines in other parts of the world and the investments the airline has in certain of those airlines amongst others.