Delta Air Lines expects to close the books on this year with a $1.6 billion profit, as the Atlanta-based carrier continues efforts to boost revenue through higher fares and fees.
Delta chief executive Richard Anderson, speaking at an investor presentation Wednesday, said 2012 “will shape up to be quite a good year.”
A $1.6 billion profit would be up from $1.2 billion for 2011, excluding special items. Including those items, Delta posted a profit of $854 million last year.
Delta expects a December quarter profit of $200 million to $250 million, despite the effects of Hurricane Sandy on flights and an oil refinery the airline bought earlier this year. The hurricane delayed the start-up of the Trainer refinery near Philadelphia, driving a loss of at least $50 million for the refinery, Delta president Ed Bastian said. Pipeline shutdowns affected the movement of crude oil and finished products, he said.
Next year, “We expect the industry climate to continue to show slow growth,” Bastian said. “But we are planning for the year with fairly significant caution.” The airline expects its flight capacity will remain flat or decline slightly.
Looking forward, Bastian said Delta’s planned joint venture with Virgin Atlantic Airways will generate about $120 million in synergy benefits after three years. Delta announced Tuesday it is buying a 49 percent stake in the British carrier for $360 million.
Anderson said the company plans to discuss at its annual shareholder meeting next year how it will return some cash to shareholders. Some have pushed for stock buybacks or dividends, but Delta for the past couple of years has focused on reducing debt.
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