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Delta Reports Financial and Operating Performance for September 2012

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October 2, 2012

Delta Reports Financial and Operating Performance for September 2012

Delta Air Lines (NYSE: DAL) today reported financial and operating performance for September 2012.

Delta continued to have solid revenue performance, with September month unit revenues up 0.5% year-over-year against a very strong performance in September 2011.? This result is lower than previous guidance due to slightly lower walk-up traffic as well as incremental capacity due to strong completion factors and charter flying.? Forward bookings remain solid for the fourth quarter; based on current demand trends, Delta expects a year over year improvement for October 2012 unit revenues in the low single digits.

For September, Delta’s system traffic fell 1.1 percent on 0.6 percent lower capacity, which resulted in a 0.4 point decline in load factor.

Delta’s adjusted fuel price per gallon was $3.09 for the month, bringing the September quarter fuel price per gallon to $3.15.

Delta continued to have exceptional operational performance in September, with a 99.8 percent completion factor and an on-time performance rate of 89.4 percent.

The company’s financial and operational performance is detailed below.? Additional guidance on Delta’s September quarter 2012 financial performance can be found on the company’s investor update, furnished as an exhibit to a Form 8-K filed today.

Preliminary Financial and Operational Results

September 2012

 

Consolidated PRASM change year over year 0.5%
Consolidated average fuel price, adjusted $3.09
On-time performance (preliminary DOT A14) 89.4%
Mainline completion factor 99.8%

Note: Fuel price includes taxes, transportation, settled hedges, and hedge premiums, but excludes mark to market adjustments on open hedges.

Delta Air Lines serves more than 160 million customers each year. During the past year, Delta was named domestic “Airline of the Year” by the readers of?Travel Weekly?magazine,?was named the “Top Tech-Friendly U.S. Airline”?by PCWorld magazine for its innovation in technology, won the?Business Travel News Annual Airline Survey?and was the recipient of 12 Executive Travel Magazine Leading Edge Awards for U.S. airlines. With an industry-leading?global network, Delta and the?Delta Connection?carriers offer service to nearly 320 destinations in 60 countries on six continents. Headquartered in Atlanta, Delta employs 80,000 employees worldwide and operates a mainline fleet of more than 700 aircraft. A founding member of theSkyTeam?global alliance, Delta participates in the industry’s leading?trans-Atlantic joint venture?with?Air France-KLM?andAlitalia. Including its worldwide alliance partners, Delta offers customers more than 13,000 daily flights, with hubs inAmsterdam,?Atlanta,?Cincinnati,?Detroit,?Memphis,?Minneapolis-St. Paul,?New York-LaGuardia,?New York-JFK,Paris-Charles de Gaulle,?Salt Lake City?and?Tokyo-Narita. The airline’s service includes the?SkyMiles?frequent flier program, a world-class airline loyalty program; the award-winning?BusinessElite?service; and more than 50 Delta?Sky Clubs?in airports worldwide. Delta is investing more than $3 billion through 2013 in airport facilities and global products, services and technology to enhance the customer experience in the air and on the ground. Customers can check in for flights, print boarding passes, check bags and review flight status at?delta.com.

Forward Looking Statements

Statements in this investor update that are not historical facts, including statements regarding our estimates, expectations, beliefs, intentions, projections or strategies for the future, may be “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. ?All forward-looking statements involve a number of risks and uncertainties that could cause actual results to differ materially from the estimates, expectations, beliefs, intentions, projections and strategies reflected in or suggested by the forward-looking statements. ?These risks and uncertainties include, but are not limited to, the cost of aircraft fuel; the impact of posting collateral in connection with our fuel hedge contracts; the impact of significant funding obligations with respect to defined benefit pension plans;?the impact that our indebtedness may have on our financial and operating activities and our ability to incur additional debt; the restrictions that financial covenants in our financing agreements will have on our financial and business operations; labor issues; interruptions or disruptions in service at one of our hub airports; our increasing dependence on technology in our operations; the ability of our credit card processors to take significant holdbacks in certain circumstances; the possible effects of accidents involving our aircraft; the effects of weather, natural disasters and seasonality on our business; the effects of an extended disruption in services provided by third party regional carriers; our ability to retain management and key employees; competitive conditions in the airline industry; the effects of the rapid spread of contagious illnesses; and the effects of terrorist attacks.

Additional information concerning risks and uncertainties that could cause differences between actual results and forward-looking statements is contained in our Securities and Exchange Commission filings, including our Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2011 and our Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2012. ?Caution should be taken not to place undue reliance on our forward-looking statements, which represent our views only as of October 2, 2012, and which we have no current intention to update.

Monthly Traffic Results (a) Year to Date Traffic Results (a)
Sept 2012 Sept 2011 Change Sept 2012 Sept 2011 Change
RPMs (000):
Domestic 8,990,497 9,381,017 (4.2%) 87,179,702 87,317,813 (0.2%)
Delta Mainline 7,221,091 7,368,599 (2.0%) 69,364,494 68,929,876 0.6%
Regional 1,769,406 2,012,418 (12.1%) 17,815,208 18,387,937 (3.1%)
International 6,798,432 6,579,964 3.3% 60,507,945 60,474,451 0.1%
Latin America 943,023 821,661 14.8% 10,548,754 10,188,210 3.5%
??? Delta Mainline 931,633 807,808 15.3% 10,423,692 10,030,800 3.9%
??? Regional 11,391 13,853 (17.8%) 125,061 157,410 (20.6%)
Atlantic 3,725,045 3,735,041 (0.3%) 31,226,139 32,464,669 (3.8%)
Pacific 2,130,364 2,023,262 5.3% 18,733,053 17,821,572 5.1%
Total System 15,788,929 15,960,981 (1.1%) 147,687,647 147,792,264 (0.1%)
ASMs (000):
Domestic 11,163,741 11,307,458 (1.3%) 103,364,856 104,842,512 (1.4%)
Delta Mainline 8,881,078 8,759,512 1.4% 80,914,586 81,420,424 (0.6%)
Regional 2,282,662 2,547,946 (10.4%) 22,450,270 23,422,088 (4.1%)
International 7,810,079 7,786,837 0.3% 72,694,822 74,779,177 (2.8%)
Latin America 1,140,661 1,065,824 7.0% 12,967,582 12,898,207 0.5%
??? Delta Mainline 1,123,851 1,042,054 7.8% 12,781,419 12,665,626 0.9%
??? Regional 16,810 23,770 (29.3%) 186,163 232,581 (20.0%)
Atlantic 4,142,203 4,247,976 (2.5%) 37,150,049 39,914,887 (6.9%)
Pacific 2,527,216 2,473,037 2.2% 22,577,192 21,966,083 2.8%
Total System 18,973,820 19,094,295 (0.6%) 176,059,678 179,621,689 (2.0%)
Load Factor:
Domestic 80.5% 83.0% (2.5) pts 84.3% 83.3% 1.0 pts
Delta Mainline 81.3% 84.1% (2.8) pts 85.7% 84.7% 1.0 pts
Regional 77.5% 79.0% (1.5) pts 79.4% 78.5% 0.9 pts
International 87.0% 84.5% 2.5 pts 83.2% 80.9% 2.3 pts
Latin America 82.7% 77.1% 5.6 pts 81.3% 79.0% 2.3 pts
??? Delta Mainline 82.9% 77.5% 5.4 pts 81.6% 79.2% 2.4 pts
??? Regional 67.8% 58.3% 9.5 pts 67.2% 67.7% (0.5) pts
Atlantic 89.9% 87.9% 2.0 pts 84.1% 81.3% 2.8 pts
Pacific 84.3% 81.8% 2.5 pts 83.0% 81.1% 1.9 pts
Total System 83.2% 83.6% (0.4) pts 83.9% 82.3% 1.6 pts
Mainline Completion 99.8% 99.6% 0.2 pts
Factor
Passengers Boarded 13,120,510 13,378,192 (1.9%) 125,042,656 124,397,845 0.5%
Cargo Ton Miles (000): 201,698 195,520 3.2% 1,791,035 1,772,309 1.1%
Endnote:
aResults include flights operated under contract carrier arrangements.
 
Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures
September 2012
Delta sometimes uses information that is derived from its Consolidated Financial Statements, but that is not presented in accordance with accounting principles generally accepted in the U.S. (“GAAP”). Certain of this information are considered “non-GAAP financial measures” under the U.S. Securities and Exchange Commission rules. The non-GAAP financial measures may be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for or superior to GAAP results.
Mark-to-market adjustments for fuel hedges recorded in periods other than the settlement period (“MTM Adjustments”).?We exclude MTM adjustments, which are based on market prices at the end of the reporting period and certain assumptions, as they are not necessarily indicative of the actual future value of the underlying hedge in the contract settlement period.
September
2012

(preliminary)

Average price per fuel gallon including fuel expense incurred under
contract carrier arrangements
$3.14
MTM Adjustments (0.05)
Average price per fuel gallon, adjusted $3.09

SOURCE Delta Air Lines

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