By Dhirendra Tripathi
Investing.com – Delta Air Lines stock (NYSE:DAL) traded 2.7% higher in Thursday’s premarket as the carrier delivered on its promise of reporting an adjusted pretax profit in the fourth quarter, albeit a smaller one than it forecast less than a month ago.
Adjusted pre-tax income was $170 million in October-December, less than the company’s forecast of around $200 million but a sharp reversal of fortunes from the $2.1 billion adjusted pre-tax loss it booked in the same period a year ago.
It also gave a resilient outlook for the spring and summer seasons, forecasting that total revenue in the quarter through March will stay between 72% and 76% of 2019 levels, roughly on a level with the 74% seen in the December quarter, despite the airline having to cancel thousands of flights so far this month due to staff absences and other Covid-related problems.
“Omicron is expected to temporarily delay the demand recovery 60 days, but as we look past the peak, we are confident in a strong spring and summer travel season with significant pent-up demand for consumer and business travel,” a company release quoted Chief Executive Officer Ed Bastian as saying.
Domestic passenger revenue was 78% restored compared to the final quarter of 2019 while international passenger revenue only recovered to 50% of pre-pandemic volumes.
Total operating revenue for the quarter was $9.47 billion, up almost 139% from a year earlier.
The airline expects to operate 83%-85% of its 2019 capacity in the current quarter despite ongoing problems with the Omicron variant of Covid-19, while it is now factoring in slightly higher fuel costs than what it estimated last month.