How Did Delta Perform Operationally In November?

Delta Air Lines (NYSE:DAL) managed to post decent operation metrics for the month of November despite being hurt over the second half of the year on adverse weather conditions. A lethal combination of increased pricing pressures and flight cancellations due to the hurricanes led to the company falling short of operational targets in Q3. That said, management was quick to react to the problem, and we can expect things returning back to normal as early as Q1 2018.

For the month of November, available seat miles (capacity) grew overall by about 2.9% y-o-y, buoyed by better-than-expected domestic growth. In terms of traffic, the company saw the key metric increase by a modest 3.5%. The carrier’s occupancy rate increased by about 40 basis points to 85.4% in the month.

The company still expects the unit revenues in the fourth-quarter to increase in the 2-4% y-o-y range, while CASM ex-fuel comes in 2-3% above the current guidance for the year on the back of adverse weather conditions, and the accelerated depreciation from incremental fleet decisions, including moving up narrow body retirements.

Notes:

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2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Delta Airlines

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