Hit by an almost 50% hike in fuel prices, Delta Airlines today came out with a public update announcing an adjustment to its June-quarter outlook accordingly. According to the letter to shareholders, Delta now expects quarterly adjusted earnings between $1.65 and $1.75 per share. This is in line with a filing last month by the company, that we reported on.
Before the update in June, Delta’s prior prediction was $1.80 to $2.00 per share. The revised range was then below the average analysts’ expectation of $1.85 per share. Without adjustments, diluted EPS is expected to be $1.36-1.46 per share.
The carrier now sees total unit revenue for the quarter to improve by 4-5% from that of last year.
Even though the company says the leisure and business segments still receive strong demand, the market fuel price hike is expected to offset it. In addition to that, non-fuel costs might see a 3% hike year-over-year. Over the course of the quarter, Delta returned about $810 million to shareholders through share repurchases and dividends.
Elsewhere, Boeing closes in on Embraer
A major commercial jet alliance is in the works with Boeing (BA) and Embraer eyeing a strategic deal that would give the aircraft maker a significant advantage over European rival Airbus. An approval from the Brazilian government is imperative to the merger, which is still awaited.
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