DAL Delta Air Lines Inc

Delta Air Lines Inc. said it swung to a profit in its final quarter of the year, again helped by drastically lower fuel costs.

Shares, recently in a nose dive and down 12% since the calendar turned to the new year, rose 1.4% premarket to $45.11 despite the No. 2 carrier by traffic's results narrowly missing analysts' estimates.

Delta's fuel price for the quarter ended in December was $1.85 a gallon, down sharply from $2.62 a gallon a year earlier. Overall fuel expense declined 63% to $1.65 billion during the period. The airline industry has broadly benefited from lower jet-fuel prices as the price of oil continues to sink, propping up profits.

"As we look ahead to 2016, we have a significant opportunity to improve our performance even further," said Chief Executive Richard Anderson, pointing to more than $3 billion in potential savings from lower fuel prices and other cost initiatives in place.

Passenger unit revenue—a key industry benchmark that measures how much money airlines take in for each passenger flown a mile—declined 2%, including a 2 point foreign-currency dent.

Overall, Delta reported a profit of $980 million, or $1.25 a share, compared with a loss of $712 million, or 86 cents, a year earlier. Excluding certain items, earnings were $1.18 a share, compared with 78 cents of profit in the year-earlier quarter. Revenue edged down 1.5% to $9.5 billion.

Analysts polled by Thomson Reuters had forecast adjusted earnings of $1.19 on $9.61 billion in revenue.

For the first quarter of the year, the airline predicted passenger unit revenue would be down between 2.5% and 4.5%, with operating margin in the range of 18% to 20%. The airline estimates its fuel costs will be between $1.20 and $1.25 and system capacity will rise 2% to 3%.

Delta nosed ahead of United Continental Holdings Inc. in 2015 to become the nation's No. 2 airline based on newly released traffic figures for the year, adding a flourish to the Atlanta-based carrier's strong performance in recent years.

Write to Anne Steele at Anne.Steele@wsj.com

(END) Dow Jones Newswires

January 19, 2016 08:35 ET (13:35 GMT)

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