Houston Chronicle

$1.2B loss for Delta, but recovery on radar

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

CEO Ed Bastian said Thursday that ticket sales have been stronger in the last two weeks than at any time since the pandemic hit the U.S. 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 labor 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,” 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 percent to 55 percent 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 percent.

UnitedHeal­th ups its profit forecast

UnitedHeal­th’s firstquart­er profit jumped about 44 percent, and the nation’s largest health insurer also hiked its 2021 outlook despite expecting more hits from the COVID-19 pandemic.

The company said Thursday that the performanc­e of its Optum division was particular­ly strong.

UnitedHeal­th raised its full-year profit forecast to adjusted earnings of $18.10

to $18.60 per share, up from an outlook of $17.75 to $18.25 per share that it debuted in December.

The new range mostly tops the average analyst forecast of $18.19 per share, according to FactSet.

That projection continues to include a potential drop of $1.80 per share from the ongoing pandemic.

Patients began returning to doctors offices and

scheduling more surgical procedures toward the end of last year after putting off medical care for months during the pandemic. That returned a bit of normality for UnitedHeal­th and other insurers, and it added more medical costs to their income statements.

Citigroup triples its profits in Q1

Citigroup’s profits more than tripled in the first quarter, the banking conglomera­te said Thursday, helped by the release of billions of dollars from its loan-loss reserves. The bank also announced plans to scale back its global consumer banking franchise outside the U.S.

The New York-based company said it earned a profit of $7.94 billion, or $3.62 per share, compared with a profit of $2.54 billion, or $1.06 a share, in the same period a year earlier. The bank’s profits were well above the $2.60 per share that analysts had been looking for, according to FactSet.

Like its major Wall Street competitor­s, Citigroup was able to release billions from its loan-loss reserves this quarter, which directly benefited its bottom line. The big banks collective­ly set aside tens of billions of dollars a year ago to cover the potential losses they might incur as the economy nosedived in the early months of the pandemic. Now that the economy is recovering, banks are able to release those funds.

Bank of America’s profits double

Bank of America’s profits doubled in the first quarter, the bank said Thursday, as the improving economy allowed it to release billions from its loan-loss reserves that it originally set aside in the early days of the pandemic.

The Charlotte-based banking giant earned $8.1 billion in the quarter, equal to 86 cents per share, compared with a profit of $4.01 billion, or 40 cents a share, in the same period a year earlier. Analysts were looking for BofA to earn 66 cents a share.

The bank had a net one-time gain of $1.86 billion for releasing loans from its loan-loss reserves.

 ?? Elijah Nouvelage / Bloomberg ?? Most of the people boarding Delta are vacationer­s booking trips to mountains, beaches and resorts.
Elijah Nouvelage / Bloomberg Most of the people boarding Delta are vacationer­s booking trips to mountains, beaches and resorts.

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