Delta Airlines Posted A Quarterly Loss For The First Time In Five Years
Delta Airlines reported a net loss of $534 million, or $0.84 per share, in the first quarter of 2020. This is the carrier's first quarterly loss in more than five years. In January-March 2019, the company reported $ 730 million in net income or $1.09 per share.
The loss, excluding one-time factors, was $0.51 per share compared to a profit of $0.96 per share a year earlier. The indicator coincided with the forecast of analysts polled by FactSet.
Delta's revenue fell 18% to $8.59 billion from $10.47 billion, with an average analyst forecast of $9.2 billion. The airline said it expects revenue to decline by 90% year-on-year in the second quarter.
Flight congestion in the first quarter decreased to 73.1% from 82.7% a year earlier. Analysts on average expected a figure of 79.1%.
Delta intends to slow the pace of spending from $100 million a day at the end of March to $50 million a day by the end of June. The airline expects that the volume of liquidity by the end of the second quarter will be $10 billion, compared to $6 billion at the moment. The company's financial director, Paul Jacobson, agreed to postpone his retirement in order to help colleagues in a crisis.
Due to the coronavirus, passenger traffic in the United States has collapsed by 95%, and airlines expect that concerns related to the coronavirus will put significant pressure on demand for flights in the near future.
Delta has reported annual earnings for 10 consecutive years and expected strong demand to continue in 2020. The company last recorded a quarterly loss in the fourth quarter of 2014.
Delta Air shares are up 4.6% in preliminary trading on Wednesday. Over the past three months, the company's capitalization has collapsed by 61.3% to $14.79 billion.