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Delta Air Lines Lowers Profit Margin Due to Early Settlement of Fuel Hedges

Delta Air Lines today said it expects a smaller profit margin for the just-ended second quarter (June 2016) because it settled fuel hedges early.

The Atlanta based airline, said settling the hedges increased its fuel cost by about $450 million for the quarter, lowering its operating profit margin to about 17% from a prior forecast of around 21 %.

Delta also said passenger unit revenue fell about 5% in the quarter from a year ago, compared with earlier guidance of a drop around 4.5%, because tickets purchased near departure dates were cheaper.