In fact, Delta spent $11.2 billion on fuel in 2014, and previous year they spent just $8.9 billion, saving them close to $3 billion.
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The results fell short of Wall Street expectations.
A precipitous decline in fuel prices has helped Delta’s bottom line, but the November attacks in Paris have shaken traveler demand and a strong US dollar has lowered the value of foreign sales in dollar terms. The company paid $1.85 per gallon last quarter, including hedging losses and refinery gains, compared to $2.62 per gallon in Q4 2014. Delta forecast that the per mile figure – a closely watched indicator of demand and average fares – would fall again, by between 2.5 percent and 4.5 percent, in the first quarter of 2016. Delta Air Lines accounts for about 2.4% of Atalanta Sosnoff Capital’s portfolio, making the stock its 12th largest position. Fuel costs for the full year decreased 44 percent, contributing to a 14 percent decline in total operating expense during 2015. Fourth-quarter results also compare to the consensus estimates for EPS of $1.19 on revenues of $9.61 billion. Delta shares climbed 2.4% to 45.56 in pre-market trading.
Delta was able to give back $530 million to shareholders in dividends during the fourth quarter. Delta President Ed Bastian said in a statement. (DAL)’s earnings surprise history, it was expected to earn $1.71 per share in Q315 while it actually produced earnings of $1.74 per share, a surprise of $+$0.03. Unit revenue declined 2.9%, compared to a 9.3% drop in the previous quarter, when capacity was down only 3.7%.
On an adjusted basis, it grew profit by 43 percent to $926 million, or $1.18 per diluted share.
The company also plans to pay its employees a total of $1.5 billion in profit sharing for the year.
Revenue passenger miles were up 3% to 49.573B.
A glut in global oil supply has powered record airline profits, and the Atlanta-based carrier estimated its 2016 fuel bill would be $3 billion lower than 2015.
Despite the big drop in oil prices, so far in 2016, shares of Delta are down sharply along with the broader market. Deutsche Bank reissued a “buy” rating and set a $51.00 price objective (up from $50.00) on shares of Delta Air Lines in a research note on Monday, October 5th.
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Adam Levine-Weinberg owns shares of United Continental Holdings, and is long January 2017 $40 calls on Delta Air Lines, and long January 2017 $30 calls on American Airlines Group.
