$1.2b loss for airline

DELTA Air Lines lost $1.2 billion in the first quarter, more than expected, but executives said on Thursday that the airline could be profitable by late summer if the budding recovery in air travel continues.

CEO Ed Bastian said on Thursday that ticket sales have been stronger in the last two weeks than at any time since the pandemic hit the US last year. So far most of the people boarding planes are vacationers booking trips to mountains, beaches and resorts.

The increase in passengers, combined with lower costs for labour and fuel, helped Delta generate $4 million in cash per day in

March after burning cash for the past year.

“It’s clear that our business is turning the corner and we’re moving into an active recovery phase,” Mr Bastian said in an interview.

“We see the business continuing to improve as consumer confidence grows.”

However, Delta forecast that second-quarter revenue will be down 50 per cent to 55 per cent compared with the same quarter in 2019, which analysts said fell short of expectations.

The company’s shares, which have more than doubled since last May, fell 3 per cent.

Several airlines have reported that bookings began to pick up in February and gained speed in March.

Delta’s bookings doubled from January to March, although 10 per cent to 15 per cent are using credits from previously cancelled flights. US leisure sales have recovered to 85 per cent of pre-pandemic levels, Delta said.