“It’s a volatile industry,” says Richard Anderson, chairman and chief executive of Delta Air Lines, on the ups-and-downs of the airline industry in the January-February issue of Airline Business.
“The question is what you do about your business model to buffer and make the enterprise successful regardless of the volatility of the marketplace,” he continues.
Anderson has done just this at Delta. With a focus on return on capital, debt reduction and strategic investments that targeted weaknesses in the airline’s balance sheet or network - the Trainer Refinery and Virgin Atlantic deals, for example - he and his management team have worked to buffer the carrier from shocks and turned it into an industry leader.
In 2013, Delta reported a $3.4 billion operating profit on $37.8 billion in operating revenue. A 56% increase and 3% increase, respectively.
The carrier’s net profit before a favourable one-time $8 billion income tax credit was $2.7 billion for the year.
Anderson prefers to stay in the background, despite Delta’s success. “The spirit at Delta is a great thing, [but] there’s 80,000 people here, it’s not [just] me,” he says. “I’ve [just] got a BlackBerry, a pen and some paper and a telephone. You know, it’s really Delta and the culture at Delta that’s done that.”