Richard, Ed and Hank will open the call with their remarks on the quarter, and we'll then move to our question-and-answer session. To get in as many questions during the Q&A, please limit yourselves to two questions.Today's discussion does contain forward-looking statements that represent our beliefs or expectations about future events. All forward-looking statements involve risks and uncertainties that could cause the actual results to differ materially from the forward-looking statements. Some of the factors that may cause these differences are described in Delta's SEC filings. We'll discuss non-GAAP financial measures, and results exclude special items unless otherwise noted. You can find a reconciliation of our non-GAAP measures on the Investor Relations page at delta.com. And with that, I will turn the call over to Richard. Richard Anderson Thank you. Good morning, everybody. Delta earned a $765 million profit for the September quarter with an operating margin of 11%. We offset the majority of this quarter's $1 billion increase in fuel price with a 10% increase in topline revenue. Delta's overall capacity was down 1% in the quarter. We experienced strong demand, particularly from corporate customers, which drove our unit passenger revenues up 11% from prior year. We continue to see strong demand in the fourth quarter. We ran a good operation with top tier operational performance in baggage service on-time completion factor, which resulted in a 40% reduction in DOT compliance year-on-year. As a result, Delta people earned $15 million in shared rewards for the quarter. Business Travel News just recognized our accomplishments by ranking Delta number one in its annual airline survey based on the overall highest ratings by corporate travel buyers. Delta also won awards as the Best Carrier for Business and Travel Agent report from Recommend Magazine, a leading travel agent publication. These accomplishments are a direct reflection of the dedication of Delta employees worldwide and their commitment to building a leading global airline. I want to thank them for all their good work. We're on track to have another good profit-sharing claimant for 2011. And while we're pleased with this quarter's performance, we have much work ahead.
For the second year in the row, we have proven that economic turbulence and inflated fuel prices will not prevent Delta from good profitability and cash flow. We are determined to build a consistently profitable airline, one that can pay for wise investments through operating cash flow and that consistently returns its cost of capital.To get there, we're focused on these key points: growing diversified revenues, treating our people well in a culture of positive employee relations, continuing our capacity discipline, keep our costs under control, running an airline customer worldwide, leveraging the business and limiting capital spending through investments with high IRRs. We've have good success in passing on high fuel costs through ticket prices at Delta, as higher revenues covered 85% of our fuel price increase. Delta must cover its fuel costs in ticket prices. Other fuel-intensive industries like railroads, trucking companies, utility operators and overnight express carriers routinely do so, and we must do the same at Delta. Delta is developing new products and services that customers value and will pay for. We are well our way to a targeted $1 billion of additional merchandising revenue by 2013 through products like Economy Comfort, which we have announced that we're expanding to our domestic system next year. Our Ancillary and Cargo businesses provide good revenue diversification with annual revenues of approximately $2 billion. Second, Delta's culture and positive relationship with our employees is unique in this industry. We will always work to maintain that culture and take care of our people, so they provide good customer service. Third, we will be disciplined in capacity. We trimmed our December quarter capacity by 4% to 5% year-on-year with the transatlantic down 10% to 12%, which is particularly important given the unrest in Europe. And those capacity cuts will roll forward into 2012. We're planning for 2012 capacity to be down 2% to 3% when compared to 2011. Read the rest of this transcript for free on seekingalpha.com