Delta Air Lines’ Q2 results beat market estimates

Delta Air Lines (NYSE: DAL) reported better-than-expected revenue and earnings for the second quarter of 2019, allowing shares to climb 2.2% in premarket hours on Thursday. The consensus estimate was for earnings of $2.24 per share on revenue of $12.4 billion.

Total operating revenue of $12.5 billion was up 6.5% from the same period last year. On an adjusted basis, revenues grew 8.7%, helped by a 10% increase in premium product ticket revenue and double-digit percentage increases in loyalty and third-party maintenance revenue.  

On a GAAP basis, net income grew 39% to $1.4 billion and EPS grew 48% to $2.21. Adjusted EPS grew 32% to $2.35.  

Total revenue per available seat mile (TRASM) grew 1.6% year-over-year on a GAAP basis and 3.8% on an adjusted basis. Consolidated unit cost (CASM) was down 1.5% on a GAAP basis and up 1.4% on an adjusted basis.

During the quarter, Delta saw revenue increases across all its geographic regions helped mainly by higher passenger unit revenue and capacity.

For the third quarter of 2019, Delta expects EPS to come in the range of $2.10-2.40. Adjusted TRASM is expected to grow 1.5-3.5% year-over-year while CASM-Ex is projected to rise 1-2%. System capacity is expected to be up around 4% from the same period last year.   

Based on the strong first half performance, the company raised its full-year 2019 EPS guidance to a range of $6.75-7.25.

Delta increased its quarterly dividend by 15% to $0.4025 per share. The dividend is payable on August 15, 2019 to shareholders of record on July 25, 2019.

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