Vice-President, Delta Air Lines, Ed Bastain, said the airline recorded first quarter 2014 net income of $213 million, an increase of $7 million over the corresponding period of last year.
He said excluding special items, the airline's quarterly result was $281 million, representing a $196 million year-over-year improvement, adding that total passenger revenue increased 5 per cent to $7.7 billion, which "shows the strength of Delta's revenue momentum even through the revenue loss from weather and a shift of the Easter holiday traffic into April".
According to him, "we see continued revenue strength as we move through the year from corporate revenue gains, the benefits of the Virgin Atlantic joint venture and improved ancillary revenues. These initiatives, coupled with a solid demand environment, should lead to unit revenue growth in the mid-single digits for the June quarter."
Total operating expense in the quarter, the Vice President continued, increased $18 million year-over-year driven by the impact of employee investments including $79 million higher profit sharing expense and that these cost increases were almost fully offset by lower fuel expense, savings from Delta's structural cost initiatives and receipt of a $25 million insurance claim related to Superstorm Sandy. He disclosed that the company returned $176 million to shareholders, adding that on March 14, the company paid $51 million to shareholders, which represents a $0.06 per share quarterly dividend.
Bastain said in addition, the company repurchased four million shares at an average price of $30.94 for a total of $125 million and that the airline has completed $375 million of the $500 million share repurchase plan authorized by Delta's Board of Directors in May 2013.
Delta, he said ended the quarter with $5.6 billion of unrestricted liquidity and adjusted net debt of $9.1 billion, stressing that the company has now achieved nearly $8 billion in net debt reduction since 2009. Speaking on the development, Delta's Chief Executive, Richard Anderson, said "the March quarter's record results in the face of unprecedented weather show the strength and resilience of Delta. By delivering the industry's best customer service, operational reliability and financial performance, Delta people continue to show that they are the very best in the business.
"Our work is not finished, and there is great opportunity ahead as we expect the June quarter to produce 14 per cent to 16 per cent operating margins. We are transforming Delta into a high-quality S&P 500 company that consistently delivers strong earnings growth and shareholder returns".