.....Delta Air's Feb. passenger revenue rose 13 pct.
Delta Air Lines says Feb. passenger revenue rose 13 percent; fuel prices climbed, too

Associated Press – 2 hours 30 minutes ago


ATLANTA (AP) -- Delta Air Lines Inc. said Friday that a key measure of revenue climbed by 13 percent in February, as occupancy rose on flights to Europe and fares across the Pacific increased.

Airlines have been seeing higher passenger revenue for each seat flown one mile in part because they've been raising fares to offset higher fuel prices. Much of the extra money paid for fares goes back out the door to buy more expensive fuel.

UBS analyst Kevin Crissey wrote that Delta's revenue increase is "indicative of continued strong demand but not rapidly accelerating pricing."

Delta also said it paid $3.35 per gallon for jet fuel in February. That suggests "importantly higher" fuel prices in the first quarter, Crissey wrote. That prompted him to predict a first-quarter loss of 17 cents per share, versus his previous expectation for a loss of 4 cents per share. Analysts surveyed by FactSet expected Delta to break even.

The February increase was about a percentage point lower than Delta had expected. Benign weather allowed it to complete 99.7 percent of its scheduled flights last month. With so few cancellations, Delta had slightly more available seats than it would have, pushing per-seat revenue down slightly.

Delta also said February traffic rose 2.6 percent from February 2011, to 12.99 billion revenue passenger miles, or one paying passenger flown one mile.

The number of passengers boarded rose 4.1 percent to 11.4 million.

Those passengers had fewer seats waiting for them compared to February 2011. Delta's capacity, measured as available seat miles, fell 1.7 percent to 16.9 billion. Domestic capacity fell 0.6 percent, while international capacity fell 3.3 percent.

With more people looking for fewer seats, occupancy rose 3.2 percentage points to 76.9 percent. The biggest jump was a 6.3 percentage point increase in occupancy on flights across the Atlantic, to 67.4 percent.

Shares of Atlanta-based Delta rose 15 cents to $9.79 in afternoon trading.