Generated double-digit operating margin in
December quarter with EPS ahead of guidance
Expect March quarter revenue to accelerate
further relative to 2019
Reiterating outlook for significant
earnings and cash flow growth in 2023, including EPS of
$5 - $6
and free cash flow of more than $2
billion
ATLANTA, Jan. 13,
2023 /PRNewswire/ -- Delta Air Lines (NYSE:DAL) today
reported financial results for the December quarter and full year
2022 and provided its outlook for the March quarter 2023.
Highlights of the December quarter and full year 2022 results,
including both GAAP and adjusted metrics, are on page five and are
incorporated here.
![Delta Air Lines and the Delta Connection carriers offer service to nearly 370 destinations on six continents. For more information visit news.delta.com. (PRNewsFoto/Delta Air Lines) Delta Air Lines and the Delta Connection carriers offer service to nearly 370 destinations on six continents. For more information visit news.delta.com. (PRNewsFoto/Delta Air Lines)](https://mma.prnewswire.com/media/75250/delta_air_lines_logo.jpg)
"Delta people rose to the challenges of 2022, delivering
industry-leading operational reliability and financial performance,
and I'm looking forward to recognizing their achievements with over
$500 million in profit sharing
payments next month," said Ed
Bastian, Delta's chief executive officer. "As we move
into 2023, the industry backdrop for air travel remains favorable
and Delta is well positioned to deliver significant earnings and
free cash flow growth. We expect to grow 2023 revenue by 15
to 20 percent and improve unit costs year-over-year, supporting a
full-year outlook for earnings of $5
to $6 per share and keeping us on
track to achieve more than $7 of
earnings per share in 2024."
December Quarter 2022 GAAP Financial Results
- Operating revenue of $13.4
billion
- Operating income of $1.5 billion
with an operating margin of 10.9 percent
- Pre-tax income of $1.1 billion
with a pre-tax margin of 8.3 percent
- Earnings per share of $1.29
- Operating cash flow of $1.2
billion
- Payments on debt and finance lease obligations of $285 million
December Quarter 2022 Adjusted Financial
Results
- Operating revenue of $12.3
billion, 8 percent higher than the December quarter
2019
- Operating income of $1.4 billion
with an operating margin of 11.6 percent
- Pre-tax income of $1.2 billion
with a pre-tax margin of 10.1 percent
- Earnings per share of $1.48
- Operating cash flow of $1.2
billion
Full Year 2022 GAAP Financial Results
- Operating revenue of $50.6
billion
- Operating income of $3.7 billion
with an operating margin of 7.2 percent
- Pre-tax income of $1.9 billion
with a pre-tax margin of 3.8 percent
- Earnings per share of $2.06
- Operating cash flow of $6.4
billion
- Payments on debt and finance lease obligations of $4.5 billion
- Total debt and finance lease obligations of $23.0 billion at year end
Full Year 2022 Adjusted Financial
Results
- Operating revenue of $45.6
billion, 2 percent lower than the full year 2019
- Operating income of $3.6 billion
with an operating margin of 7.8 percent
- Pre-tax income of $2.7 billion
with a pre-tax margin of 5.9 percent
- Earnings per share of $3.20
- Operating cash flow of $6.2
billion
- Free cash flow of $244
million
- $9.4 billion in liquidity*
and adjusted net debt of $22.3
billion at year end
*Includes cash and cash
equivalents, short-term investments and undrawn revolving credit
facilities
|
March Quarter and Full Year
Outlook1
|
1Q23 Forecast
|
FY 2023 Forecast
|
Total
Revenue
|
+14% - 17% vs.
2019
|
+15% - 20%
YoY
|
Operating
Margin
|
4% - 6%
|
10% - 12%
|
Earnings Per
Share
|
$0.15 -
$0.40
|
$5 - $6
|
1 Non-GAAP
measures; Refer to Non-GAAP reconciliations for comparison
figures
|
Additional metrics for financial modeling can be found in the
Supplemental Information section under Quarterly Results on
ir.delta.com.
Revenue Environment and Outlook
"Industry-leading operations and the best-in-class service our
people provided drove strong customer satisfaction scores and
increasing brand preference in 2022," said Glen Hauenstein, Delta's president. "For
the year we delivered $45.6 billion
in adjusted revenue, a $19 billion increase over the prior
year, with record unit revenue performance expected to sustain a
revenue premium to the industry of more than 110 percent.
Momentum continues in 2023 with strong demand trends, and we expect
March quarter adjusted revenue to be 14 to 17 percent higher than
2019 on capacity that is 1 percent lower."
- Consumer demand remains robust: Strong demand
through the quarter drove Domestic total passenger revenue 7
percent higher versus December quarter 2019, with International
passenger revenue up 5 percent.
- Business bookings steady: Domestic Corporate sales* in
the December quarter were 80 percent recovered to 2019
levels. Recent corporate survey results indicate that 96
percent of companies expect their travel will stay the same or
increase sequentially in the March quarter.
- Premium product revenue momentum continues: Premium
revenue was up 13 percent in the December quarter versus 2019, 8
points higher than main cabin revenue growth.
*Corporate sales
include tickets sold to corporate contracted customers, including
tickets for travel during and beyond the referenced time
period
|
- American Express remuneration exceeds target:
Remuneration for the December quarter was $1.5 billion, approximately 40 percent higher
than the December quarter 2019 and was approximately $5.5 billion for the full year 2022, exceeding
our initial target of $5
billion. Co-brand card spend was up 45 percent
compared to the December quarter 2019 with co-brand card
acquisitions exceeding 2019 levels.
Cost Performance and Outlook
"With a step up in capacity restoration, we reported sequential
improvement in December quarter unit cost performance. In
2023, we are confident in completing our network rebuild and
delivering the benefits of scale and efficiency as we move through
the year, resulting in a 2 to 4 percent decline in non-fuel unit
costs year-over-year, including all expected labor cost increases,"
said Dan Janki, Delta's chief
financial officer.
"For the March quarter, we expect non-fuel unit costs to
increase 3 to 4 percent year-over-year, including a full quarter
impact from labor cost increases and finalizing the rebuild of our
network for the peak summer period. Our outlooks for the
March quarter and full year are consistent with our cost framework
provided to investors on December 14,
updated for all expected labor cost increases," Janki said.
December Quarter 2022 Cost Performance
- December quarter operating expense of $12.0 billion and total adjusted operating
expense of $10.9 billion
- December quarter adjusted non-fuel costs of $7.8 billion
- December quarter non-fuel CASM was 13 percent higher than the
December quarter 2019 on 9 percent less capacity, including a 1
point impact from severe winter weather
- Adjusted fuel expense of $2.8
billion was up 40 percent compared to the December quarter
2019
- Adjusted fuel price of $3.20 per
gallon includes a refinery benefit of 30¢ per gallon
- Fuel efficiency, defined as gallons per 1,000 ASMs, was 14.6, a
4.1 percent improvement versus 2019
Full Year 2022 Cost Performance
- Full year 2022 operating expense of $46.9 billion and total adjusted operating
expense of $42.0 billion
- Full year 2022 adjusted non-fuel costs of $30.0 billion
- Full year non-fuel CASM was 18 percent higher than the full
year 2019 on 15 percent less capacity
- Adjusted fuel expense of $11.5
billion was up 35 percent compared to 2019
- Adjusted fuel price of $3.36 per
gallon includes a refinery benefit of 23¢ per gallon
- Fuel efficiency, defined as gallons per 1,000 ASMs, was 14.6, a
4.2 percent improvement versus 2019
Balance Sheet, Cash and Liquidity
"We made significant progress restoring our financial foundation
in 2022 with positive free cash flow generation and three quarters
of double-digit margins. This enabled us to pay down over
$4.5 billion of gross debt during the
year, strengthening our balance sheet," Janki said. "We
expect to deliver free cash flow of more than $2 billion in 2023 and further reduce debt on our
path to reach investment grade metrics in 2024."
- Adjusted net debt of $22.3
billion at quarter end; weighted average interest rate of
4.7 percent with 83 percent fixed rate debt and 17 percent variable
rate debt
- Payments on debt and finance lease obligations of $285 million in the December quarter, bringing
year-to-date total to $4.5
billion
- Operating cash flow in the December quarter of $1.2 billion and gross capital expenditures of
$2.1 billion
- Full year operating cash flow of $6.2
billion and gross capital expenditures of $6.0 billion, resulting in $244 million free cash flow
- Air Traffic Liability ended the year at $8.3 billion, up $1.9
billion compared to the end of 2021
- Liquidity of $9.4 billion at
year-end, including $2.9 billion in
undrawn revolver capacity
December Quarter and 2022 Highlights
Operational Reliability
- Earned the Cirium Platinum Award for global operational
excellence as North America's most
on-time airline, reflecting the exemplary work of the Delta people
to achieve on-time performance while limiting the impact of
disruption to our customers
- Operated the most on-time airline during the quarter, leading
our competitors in October, November and December* despite the most
impactful weather event of 2022 over the Christmas holiday
- For the full year, Delta's network system ranked first among
our competitors in Completion Factor, A0, A14 and D0**
Culture and People
- Delta people earned $563 million
in profit sharing and $61 million in
Shared Rewards for the year, recognizing the outstanding
performance of Delta's 90,000 employees
- Ranked 6th overall and the top airline recognized on Forbes'
annual list of the "World's Best Employers"
- Launched fundraising campaign to ensure the long-term health of
Delta's employee assistance fund, the Delta Care Fund, with a goal
of raising $30 million
- Expanded recruitment strategy giving active-duty military
pilots conditional job offers up to two years before
retirement
- Announced employee healthcare premiums for 2023 will not
increase for the fifth consecutive year
- Helped build Habitat for Humanity homes, bringing the total
built or rehabbed by Delta volunteers to 279
Customer Experience and Loyalty
- Announced at CES fast, free, unlimited Wi-Fi on most domestic
mainline flights starting February 1,
2023 for all customers through a free SkyMiles account
- Introduced Delta Sync, to create personalized experiences and
further elevate the consumer experience across the travel journey,
including partnerships with leading brands
- 2022 NPS score higher than 2019, representing growing brand
affinity and leading operational reliability
- Added a record 8.5 million new SkyMiles Members in 2022 and a
record 1.2 million new Delta American Express cardholders
- Took delivery of 69 aircraft in 2022, including new A321neo,
A220-300, A330-900, A350-900 aircraft and gently used Boeing
737-900ER aircraft
- Named No. 1 in the Business Travel News Airline Survey for the
12th consecutive year and No. 1 U.S. airline by Conde Nast Traveler
readers
- Received top honors from The Points Guy's Readers' Choice
Awards for the Best U.S. Airline Loyalty Program, Best Airport
Lounge Network and Best Airline Co-Branded Credit Card with the
SkyMiles® Platinum American Express
- Awarded Delta SkyMiles as Americas' top loyalty program by the
Frequent Traveler People's Awards in four of its five award
categories
- Opened the latest phase of the Delta Sky Way in Los Angeles and a new Delta Sky Club at
Chicago O'Hare
Environmental, Social and Governance
- Improved fuel efficiency by 4.2 percent in 2022 versus 2019
through fleet renewal and other initiatives
- Saved more than 10 million gallons of fuel in 2022 as a result
of Delta's Carbon Council initiatives including fleet
modifications, enhanced landing procedures and optimizations to
flight routing and speed
- Partnering with Aero Design Labs to test novel drag-reduction
technology to further decrease emissions
- Honored with the Green Partner in Travel Award from the
American Society of Travel Advisors
- Awarded the North American Environmental Sustainability Airline
/ Airline Group of the Year award from the Centre for Aviation
- Engaged more than 70 percent of our officer group in racial
equity training
* Based on FlightStats
preliminary data for Delta flights system wide and for Delta's
competitive set (AA, UA, B6, AS, WN, and DL), from October 1 -
December 31, 2022. On-time is defined as A0.
|
** Based on US DOT ATCR
for January - September, and FlightStats preliminary data for Delta
flights system wide and for Delta's competitive set (AA, UA, B6,
AS, WN, and DL), from October 1 - December 31, 2022.
|
December Quarter Results
December quarter results have been adjusted primarily for the
third-party refinery sales, unrealized losses on investments and
loss on extinguishment of debt and as described in the
reconciliations in Note A.
|
GAAP
|
Adjusted
|
GAAP
|
Adjusted
|
($ in millions except
per share and unit costs)
|
4Q22
|
4Q19
|
4Q22
|
4Q19
|
FY22
|
FY19
|
FY22
|
FY19
|
Operating
income
|
1,470
|
1,399
|
1,422
|
1,423
|
3,661
|
6,618
|
3,566
|
6,636
|
Operating
margin
|
10.9 %
|
12.2 %
|
11.6 %
|
12.5 %
|
7.2 %
|
14.1 %
|
7.8 %
|
14.2 %
|
Pre-tax
income
|
1,120
|
1,397
|
1,242
|
1,417
|
1,914
|
6,198
|
2,703
|
6,214
|
Pre-tax
margin
|
8.3 %
|
12.2 %
|
10.1 %
|
12.4 %
|
3.8 %
|
13.2 %
|
5.9 %
|
13.3 %
|
Net income
|
828
|
1,099
|
950
|
1,098
|
1,318
|
4,767
|
2,053
|
4,776
|
Diluted earnings per
share
|
1.29
|
1.71
|
1.48
|
1.70
|
2.06
|
7.30
|
3.20
|
7.32
|
Operating
revenue
|
13,435
|
11,439
|
12,292
|
11,384
|
50,582
|
47,007
|
45,605
|
46,718
|
Total revenue per
available seat mile (TRASM) (cents)
|
22.58
|
17.47
|
20.66
|
17.39
|
21.69
|
17.07
|
19.55
|
16.97
|
Operating
expense
|
11,965
|
10,040
|
10,871
|
9,961
|
46,921
|
40,389
|
42,039
|
40,082
|
Non-fuel
cost
|
|
|
7,821
|
7,590
|
|
|
30,024
|
29,962
|
Cost per available seat
mile (CASM) (cents)
|
20.11
|
15.34
|
13.14
|
11.59
|
20.12
|
14.67
|
12.87
|
10.88
|
Fuel expense
|
2,849
|
2,012
|
2,778
|
1,983
|
11,482
|
8,519
|
11,453
|
8,477
|
Average fuel price per
gallon
|
3.28
|
2.01
|
3.20
|
1.99
|
3.36
|
2.02
|
3.36
|
2.01
|
Operating cash
flow
|
1,189
|
969
|
1,211
|
837
|
6,364
|
8,425
|
6,210
|
8,476
|
Capital
expenditures
|
2,200
|
1,072
|
2,113
|
954
|
6,366
|
4,936
|
6,008
|
5,306
|
Total debt and finance
lease obligations
|
23,030
|
11,160
|
|
|
23,030
|
11,160
|
|
|
Adjusted net
debt
|
|
|
22,303
|
10,489
|
|
|
22,303
|
10,489
|
About Delta Air Lines Through the warmth
and service of the Delta Air Lines (NYSE: DAL) people and the power
of innovation, Delta never stops looking for ways to make every
trip feel personalized. More than 90,000 Delta people lead the way
in delivering a world-class customer experience on over 4,000 daily
flights to more than 275 destinations on six continents, connecting
people to places and each other.
Delta is committed to serving as many as 200 million
customers annually, with industry-leading customer service, safety,
innovation and reliability – recognized as North America's most on-time airline. We're
dedicated to ensuring that the future of travel is connected,
personalized and enjoyable. Our people's genuine and enduring
motivation is to make every customer feel welcomed and respected
across every point of their journey with us.
Headquartered in Atlanta,
Delta operates significant hubs and key markets in Amsterdam, Atlanta, Boston, Detroit, London-Heathrow, Los
Angeles, Mexico City,
Minneapolis-St. Paul, New York-JFK
and LaGuardia, Paris-Charles de
Gaulle, Salt Lake City,
Seattle, Seoul-Incheon and
Tokyo.
As the leading global airline, Delta's mission to connect the
world creates opportunities, fosters understanding and expands
horizons by connecting people and communities to each other and
their potential.
Powered by innovative and strategic partnerships with
Aeromexico, Air France-KLM, China
Eastern, Korean Air, LATAM, Virgin Atlantic and WestJet,
Delta brings more choice and competition to customers
worldwide.
Delta is America's most-awarded airline thanks to the
dedication, passion and professionalism of its people, recognized
by Fortune, the Wall Street Journal, and Business Travel News,
among many others.
Forward Looking Statements
Statements made in this press release that are not historical
facts, including statements regarding our estimates, expectations,
beliefs, intentions, projections, goals, aspirations, commitments
or strategies for the future, should be considered "forward-looking
statements" under the Securities Act of 1933, as amended, the
Securities Exchange Act of 1934, as amended, and the Private
Securities Litigation Reform Act of 1995. Such statements are not
guarantees or promised outcomes and should not be construed as
such. All forward-looking statements involve a number of risks and
uncertainties that could cause actual results to differ materially
from the estimates, expectations, beliefs, intentions, projections,
goals, aspirations, commitments and strategies reflected in or
suggested by the forward-looking statements. These risks and
uncertainties include, but are not limited to, the material adverse
effect that the COVID-19 pandemic has had on our business; the
impact of incurring significant debt in response to the pandemic;
failure to comply with the financial and other covenants in our
financing agreements; the possible effects of accidents involving
our aircraft or aircraft of our airline partners; breaches or
lapses in the security of technology systems on which we rely and
of the data stored within them, as well as compliance with
ever-evolving global privacy and security regulatory obligations;
disruptions in our information technology infrastructure; our
dependence on technology in our operations; our commercial
relationships with airlines in other parts of the world and the
investments we have in certain of those airlines; the effects of a
significant disruption in the operations or performance of third
parties on which we rely; failure to realize the full value of
intangible or long-lived assets; labor issues; the effects of
weather, natural disasters and seasonality on our business; changes
in the cost of aircraft fuel; extended disruptions in the supply of
aircraft fuel, including from Monroe Energy, LLC ("Monroe"), a wholly-owned subsidiary of Delta;
failure or inability of insurance to cover a significant liability
at Monroe's Trainer refinery;
failure to comply with existing and future environmental
regulations to which Monroe's
refinery operations are subject, including costs related to
compliance with renewable fuel standard regulations; our ability to
retain senior management and other key employees, and to maintain
our company culture; significant damage to our reputation and
brand, including from exposure to significant adverse publicity or
inability to achieve certain sustainability goals; the effects of
terrorist attacks, geopolitical conflict or security events;
competitive conditions in the airline industry; extended
interruptions or disruptions in service at major airports at which
we operate or significant problems associated with types of
aircraft or engines we operate; the effects of extensive government
regulation we are subject to; the impact of environmental
regulation, including but not limited to increased regulation to
reduce emissions and other risks associated with climate change,
and the cost of compliance with more stringent environmental
regulations; and unfavorable economic or political conditions in
the markets in which we operate or volatility in currency exchange
rates.
Additional information concerning risks and uncertainties that
could cause differences between actual results and forward-looking
statements is contained in our Securities and Exchange Commission
filings, including our Annual Report on Form 10-K for the fiscal
year ended December 31, 2021 and our
Quarterly Reports on Forms 10-Q for the quarterly period ended
September 30, 2022. Caution should be
taken not to place undue reliance on our forward-looking
statements, which represent our views only as of the date of this
press release, and which we undertake no obligation to update
except to the extent required by law.
DELTA AIR LINES, INC.
|
Consolidated Statements of
Operations
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
Year Ended
|
|
|
|
December 31,
|
|
|
|
December 31,
|
|
|
(in millions, except
per share data)
|
2022
|
2019
|
$ Change
|
% Change
|
|
2022
|
2019
|
$ Change
|
% Change
|
Operating Revenue:
|
|
|
|
|
|
|
|
|
|
Passenger
|
$
10,889
|
$
10,245
|
$
644
|
6 %
|
|
$ 40,218
|
$ 42,277
|
$ (2,059)
|
(5) %
|
Cargo
|
248
|
187
|
61
|
33 %
|
|
1,050
|
753
|
297
|
39 %
|
Other
|
2,298
|
1,007
|
1,291
|
NM
|
|
9,314
|
3,977
|
5,337
|
NM
|
Total operating
revenue
|
13,435
|
11,439
|
1,996
|
17 %
|
|
50,582
|
47,007
|
3,575
|
8 %
|
|
|
|
|
|
|
|
|
|
|
Operating Expense:
|
|
|
|
|
|
|
|
|
|
Salaries and related
costs
|
3,071
|
3,046
|
25
|
1 %
|
|
11,902
|
11,601
|
301
|
3 %
|
Aircraft fuel and
related taxes
|
2,849
|
2,012
|
837
|
42 %
|
|
11,482
|
8,519
|
2,963
|
35 %
|
Ancillary businesses
and refinery
|
1,308
|
299
|
1,009
|
NM
|
|
5,756
|
1,245
|
4,511
|
NM
|
Contracted
services
|
920
|
742
|
178
|
24 %
|
|
3,345
|
2,942
|
403
|
14 %
|
Landing fees and other
rents
|
570
|
538
|
32
|
6 %
|
|
2,181
|
2,176
|
5
|
— %
|
Depreciation and
amortization
|
554
|
622
|
(68)
|
(11) %
|
|
2,107
|
2,581
|
(474)
|
(18) %
|
Regional carrier
expense
|
504
|
536
|
(32)
|
(6) %
|
|
2,051
|
2,158
|
(107)
|
(5) %
|
Aircraft maintenance
materials and outside repairs
|
508
|
417
|
91
|
22 %
|
|
1,982
|
1,751
|
231
|
13 %
|
Passenger commissions
and other selling expenses
|
507
|
542
|
(35)
|
(6) %
|
|
1,891
|
2,211
|
(320)
|
(14) %
|
Passenger
service
|
403
|
325
|
78
|
24 %
|
|
1,453
|
1,312
|
141
|
11 %
|
Profit
sharing
|
272
|
387
|
(115)
|
(30) %
|
|
563
|
1,643
|
(1,080)
|
(66) %
|
Aircraft
rent
|
128
|
105
|
23
|
22 %
|
|
508
|
423
|
85
|
20 %
|
Restructuring
charges
|
(118)
|
—
|
(118)
|
NM
|
|
(124)
|
—
|
(124)
|
NM
|
Other
|
489
|
469
|
20
|
4 %
|
|
1,824
|
1,827
|
(3)
|
— %
|
Total operating
expense
|
11,965
|
10,040
|
1,925
|
19 %
|
|
46,921
|
40,389
|
6,532
|
16 %
|
|
|
|
|
|
|
|
|
|
|
Operating Income
|
1,470
|
1,399
|
71
|
5 %
|
|
3,661
|
6,618
|
(2,957)
|
(45) %
|
|
|
|
|
|
|
|
|
|
|
Non-Operating Expense:
|
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
(238)
|
(72)
|
(166)
|
NM
|
|
(1,029)
|
(301)
|
(728)
|
NM
|
Impairments and equity
method results
|
(12)
|
(18)
|
6
|
(33) %
|
|
(20)
|
(62)
|
42
|
(68) %
|
Gain/(loss) on
investments, net
|
(170)
|
136
|
(306)
|
NM
|
|
(783)
|
119
|
(902)
|
NM
|
Loss on extinguishment
of debt
|
—
|
—
|
—
|
NM
|
|
(100)
|
—
|
(100)
|
NM
|
Pension and related
benefit/(expense)
|
74
|
(17)
|
91
|
NM
|
|
292
|
(65)
|
357
|
NM
|
Miscellaneous,
net
|
(4)
|
(31)
|
27
|
(87) %
|
|
(107)
|
(111)
|
4
|
(4) %
|
Total non-operating
expense, net
|
(350)
|
(2)
|
(348)
|
NM
|
|
(1,747)
|
(420)
|
(1,327)
|
NM
|
|
|
|
|
|
|
|
|
|
|
Income Before Income Taxes
|
1,120
|
1,397
|
(277)
|
(20) %
|
|
1,914
|
6,198
|
(4,284)
|
(69) %
|
|
|
|
|
|
|
|
|
|
|
Income Tax Provision
|
(292)
|
(298)
|
6
|
(2) %
|
|
(596)
|
(1,431)
|
835
|
(58) %
|
|
|
|
|
|
|
|
|
|
|
Net Income
|
$
828
|
$
1,099
|
$
(271)
|
(25) %
|
|
$
1,318
|
$
4,767
|
$ (3,449)
|
(72) %
|
|
|
|
|
|
|
|
|
|
|
Basic Earnings Per Share
|
$
1.30
|
$
1.71
|
|
|
|
$
2.07
|
$
7.32
|
|
|
Diluted Earnings Per Share
|
$
1.29
|
$
1.71
|
|
|
|
$
2.06
|
$
7.30
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic Weighted Average Shares
Outstanding
|
638
|
642
|
|
|
|
638
|
651
|
|
|
Diluted Weighted Average Shares
Outstanding
|
641
|
644
|
|
|
|
641
|
653
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DELTA AIR LINES, INC.
|
Passenger Revenue
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
Year Ended
|
|
|
|
December 31,
|
|
|
|
December 31,
|
|
|
(in
millions)
|
2022
|
2019
|
$ Change
|
% Change
|
|
2022
|
2019
|
$ Change
|
% Change
|
Ticket - Main
cabin
|
$
5,398
|
$
5,169
|
$
229
|
4 %
|
|
$ 20,397
|
$ 21,751
|
$ (1,354)
|
(6) %
|
Ticket - Premium
products
|
4,223
|
3,753
|
470
|
13 %
|
|
15,230
|
15,157
|
73
|
— %
|
Loyalty travel
awards
|
825
|
726
|
99
|
14 %
|
|
2,898
|
2,900
|
(2)
|
— %
|
Travel-related
services
|
443
|
597
|
(154)
|
(26) %
|
|
1,694
|
2,469
|
(775)
|
(31) %
|
Total passenger revenue
|
$ 10,889
|
$ 10,245
|
$
644
|
6 %
|
|
$ 40,218
|
$ 42,277
|
$ (2,059)
|
(5) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DELTA AIR LINES, INC.
|
Other Revenue
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
Year Ended
|
|
|
|
December 31,
|
|
|
|
December 31,
|
|
|
(in
millions)
|
2022
|
2019
|
$ Change
|
% Change
|
|
2022
|
2019
|
$ Change
|
% Change
|
Refinery
|
$
1,142
|
$
2
|
$
1,140
|
NM
|
|
$
4,977
|
$
97
|
$
4,880
|
NM
|
Loyalty
program
|
720
|
519
|
201
|
39 %
|
|
2,597
|
1,962
|
635
|
32 %
|
Ancillary
businesses
|
182
|
305
|
(123)
|
(40) %
|
|
846
|
1,200
|
(354)
|
(30) %
|
Miscellaneous
|
254
|
181
|
73
|
40 %
|
|
894
|
718
|
176
|
25 %
|
Total other revenue
|
$
2,298
|
$
1,007
|
$
1,291
|
NM
|
|
$
9,314
|
$
3,977
|
$
5,337
|
NM
|
|
|
|
|
|
|
|
|
|
|
DELTA AIR LINES, INC.
|
Total Revenue
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase (Decrease)
|
|
|
|
|
4Q22 vs 4Q19
|
Revenue
|
|
4Q22 ($M)
|
|
Change
|
Unit Revenue
|
Yield
|
Capacity
|
Domestic
|
$
|
8,162
|
|
7 %
|
16 %
|
15 %
|
(8) %
|
Atlantic
|
|
1,540
|
|
17 %
|
9 %
|
14 %
|
8 %
|
Latin
America
|
|
805
|
|
15 %
|
27 %
|
24 %
|
(9) %
|
Pacific
|
|
382
|
|
(35) %
|
32 %
|
42 %
|
(50) %
|
Total Passenger
|
$
|
10,889
|
|
6 %
|
17 %
|
18 %
|
(9) %
|
Cargo Revenue
|
|
248
|
|
33 %
|
|
|
|
Other Revenue
|
|
2,298
|
|
NM
|
|
|
|
Total Revenue
|
$
|
13,435
|
|
17 %
|
29 %
|
|
|
Third Party
Refinery Sales
|
|
(1,142)
|
|
|
|
|
|
Total Revenue, adjusted
|
$
|
12,292
|
|
8 %
|
19 %
|
|
|
|
|
|
|
|
|
|
|
DELTA AIR LINES,
INC.
Statistical
Summary
(Unaudited)
|
|
|
Three Months Ended
|
|
|
|
Year Ended
|
|
|
|
December 31,
|
|
|
|
December 31,
|
|
|
|
2022
|
2019
|
Change
|
|
2022
|
2019
|
Change
|
Revenue passenger miles
(millions)
|
50,476
|
56,028
|
(10)
|
%
|
|
195,480
|
237,680
|
(18)
|
%
|
Available seat miles
(millions)
|
59,506
|
65,468
|
(9)
|
%
|
|
233,226
|
275,379
|
(15)
|
%
|
Passenger mile yield
(cents)
|
21.57
|
18.29
|
18
|
%
|
|
20.57
|
17.79
|
16
|
%
|
Passenger revenue per
available seat mile (cents)
|
18.30
|
15.65
|
17
|
%
|
|
17.24
|
15.35
|
12
|
%
|
Total revenue per
available seat mile (cents)
|
22.58
|
17.47
|
29
|
%
|
|
21.69
|
17.07
|
27
|
%
|
TRASM, adjusted - see
Note A (cents)
|
20.66
|
17.39
|
19
|
%
|
|
19.55
|
16.97
|
15
|
%
|
Cost per available seat
mile (cents)
|
20.11
|
15.34
|
31
|
%
|
|
20.12
|
14.67
|
37
|
%
|
CASM-Ex - see
Note A (cents)
|
13.14
|
11.59
|
13
|
%
|
|
12.87
|
10.88
|
18
|
%
|
Passenger load
factor
|
85 %
|
86 %
|
(1)
|
pt
|
|
84 %
|
86 %
|
(2)
|
pts
|
Fuel gallons consumed
(millions)
|
869
|
999
|
(13)
|
%
|
|
3,412
|
4,214
|
(19)
|
%
|
Average price per fuel
gallon
|
$
3.28
|
$
2.01
|
63
|
%
|
|
$
3.36
|
$
2.02
|
66
|
%
|
Average price per fuel
gallon, adjusted - see Note A
|
$
3.20
|
$
1.99
|
61
|
%
|
|
$
3.36
|
$
2.01
|
67
|
%
|
DELTA AIR LINES, INC.
|
|
Consolidated Statements of Cash
Flows
|
|
(Unaudited)
|
|
|
Three Months Ended
|
|
|
December 31,
|
|
(in
millions)
|
2022
|
2019
|
|
Cash Flows From Operating
Activities:
|
|
|
|
Net income
|
$
828
|
$
1,099
|
|
Depreciation and
amortization
|
554
|
622
|
|
Changes in air traffic
liability
|
(837)
|
(647)
|
|
Changes in balance
sheet and other, net
|
644
|
(105)
|
|
Net cash provided by
operating activities
|
1,189
|
969
|
|
|
|
|
|
Cash Flows From Investing
Activities:
|
|
|
|
Property and equipment
additions:
|
|
|
|
Flight equipment,
including advance payments
|
(1,643)
|
(570)
|
|
Ground property and
equipment, including technology
|
(557)
|
(502)
|
|
Purchase of short-term
investments
|
(2,129)
|
—
|
|
Redemption of
short-term investments
|
221
|
—
|
|
Purchase of equity
investments
|
(717)
|
—
|
|
Other, net
|
89
|
293
|
|
Net cash used in investing
activities
|
(4,736)
|
(779)
|
|
|
|
|
|
Cash Flows From Financing
Activities:
|
|
|
|
Payments on debt and
finance lease obligations
|
(285)
|
(516)
|
|
Repurchase of common
stock
|
—
|
(225)
|
|
Proceeds from long-term
obligations
|
—
|
1,557
|
|
Cash
dividends
|
—
|
(259)
|
|
Fuel card
obligation
|
—
|
297
|
|
Other, net
|
(20)
|
(12)
|
|
Net cash (used in)/provided
by financing activities
|
(305)
|
842
|
|
|
|
|
|
Net (Decrease)/Increase in Cash, Cash Equivalents and
Restricted Cash Equivalents
|
(3,852)
|
1,032
|
|
Cash, cash equivalents
and restricted cash equivalents at beginning of period
|
7,325
|
2,698
|
|
Cash, cash equivalents
and restricted cash equivalents at end of period
|
$
3,473
|
$
3,730
|
|
|
|
|
|
The following table
provides a reconciliation of cash, cash equivalents and restricted
cash reported within the Consolidated Balance Sheets to the total
of the same such amounts shown above:
|
|
|
|
|
|
|
Current assets:
|
|
|
|
Cash and cash
equivalents
|
$
3,266
|
$
2,882
|
|
Restricted cash included in
prepaid expenses and other
|
138
|
212
|
|
Other assets:
|
|
|
|
Restricted cash included in
other noncurrent assets
|
69
|
636
|
|
Total cash, cash
equivalents and restricted cash equivalents
|
$
3,473
|
$
3,730
|
|
|
|
|
|
|
|
|
|
|
DELTA AIR LINES, INC.
|
Consolidated Balance Sheets
|
(Unaudited)
|
|
|
|
|
|
|
|
December 31,
|
|
December 31,
|
(in
millions)
|
2022
|
|
2021
|
ASSETS
|
Current Assets:
|
|
|
|
|
Cash and cash
equivalents
|
$
3,266
|
|
$
7,933
|
|
Short-term
investments
|
3,268
|
|
3,386
|
|
Accounts receivable,
net
|
3,176
|
|
2,404
|
|
Fuel inventory,
expendable parts and supplies inventories, net
|
1,424
|
|
1,098
|
|
Prepaid expenses and
other
|
1,877
|
|
1,119
|
|
Total current
assets
|
13,011
|
|
15,940
|
|
|
|
|
|
Property and Equipment, Net:
|
|
|
|
|
Property and equipment,
net
|
33,109
|
|
28,749
|
|
|
|
|
|
Other Assets:
|
|
|
|
|
Operating lease
right-of-use assets
|
7,036
|
|
7,237
|
|
Goodwill
|
9,753
|
|
9,753
|
|
Identifiable
intangibles, net
|
5,992
|
|
6,001
|
|
Equity
investments
|
2,128
|
|
1,712
|
|
Deferred income taxes,
net
|
339
|
|
1,294
|
|
Other noncurrent
assets
|
907
|
|
1,773
|
|
Total other
assets
|
26,155
|
|
27,770
|
Total assets
|
$
72,275
|
|
$
72,459
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS'
EQUITY
|
Current Liabilities:
|
|
|
|
|
Current maturities of
debt and finance leases
|
$
2,359
|
|
$
1,782
|
|
Current maturities of
operating leases
|
714
|
|
703
|
|
Air traffic
liability
|
8,160
|
|
6,228
|
|
Accounts
payable
|
5,106
|
|
4,240
|
|
Accrued salaries and
related benefits
|
3,288
|
|
2,457
|
|
Loyalty program
deferred revenue
|
3,434
|
|
2,710
|
|
Fuel card
obligation
|
1,100
|
|
1,100
|
|
Other accrued
liabilities
|
1,780
|
|
1,746
|
|
Total current
liabilities
|
25,941
|
|
20,966
|
|
|
|
|
|
Noncurrent Liabilities:
|
|
|
|
|
Debt and finance
leases
|
20,671
|
|
25,138
|
|
Noncurrent air traffic
liability
|
100
|
|
130
|
|
Pension, postretirement
and related benefits
|
3,843
|
|
6,035
|
|
Loyalty program
deferred revenue
|
4,448
|
|
4,849
|
|
Noncurrent operating
leases
|
6,866
|
|
7,056
|
|
Other noncurrent
liabilities
|
3,950
|
|
4,398
|
|
Total noncurrent
liabilities
|
39,878
|
|
47,606
|
|
|
|
|
|
Commitments and Contingencies
|
|
|
|
|
|
|
|
|
Stockholders' Equity:
|
6,456
|
|
3,887
|
Total liabilities and
stockholders' equity
|
$
72,275
|
|
$
72,459
|
Note A: The following tables show reconciliations of non-GAAP
financial measures. The reasons Delta uses these measures are
described below. Reconciliations may not calculate due to
rounding.
Delta sometimes uses information ("non-GAAP financial measures")
that is derived from the Consolidated Financial Statements, but
that is not presented in accordance with accounting principles
generally accepted in the U.S. ("GAAP"). Under the Securities and
Exchange Commission rules, non-GAAP financial measures may be
considered in addition to results prepared in accordance with GAAP,
but should not be considered a substitute for or superior to GAAP
results. The tables below show reconciliations of non-GAAP
financial measures used in this release to the most directly
comparable GAAP financial measures.
Forward Looking Projections. Delta is not able to
reconcile forward looking non-GAAP financial measures without
unreasonable effort because the adjusting items such as those used
in the reconciliations below will not be known until the end of the
period and could be significant.
Adjustments. These reconciliations include certain
adjustments to GAAP measures, that are directly related to the
impact of COVID-19 and our response. These adjustments are made to
provide comparability between the reported periods, if applicable,
as indicated below:
Restructuring charges. During 2020, we
recorded restructuring charges for items such as fleet impairments
and voluntary early retirement and separation programs following
strategic business decisions in response to the COVID-19 pandemic.
In the December quarter 2022 and year ended December 2022, we recognized $118 million and $124
million, respectively, of net adjustments to certain of
those restructuring charges, representing changes in our
estimates.
Loss on extinguishment of debt. This
adjustment relates to early termination of a portion of our
debt.
We also regularly adjust certain GAAP measures for the following
items, if applicable, for the reasons indicated below:
Third-party refinery sales.
Refinery sales to third parties, and related expenses, are not
related to our airline segment. Excluding these sales therefore
provides a more meaningful comparison of our airline operations to
the rest of the airline industry.
Delta Private Jets adjustment. Because we
combined Delta Private Jets with Wheels Up in January 2020, we have excluded the impact of
Delta Private Jets from 2019 results for comparability.
MTM adjustments and settlements on
hedges. Mark-to-market ("MTM") adjustments are defined
as fair value changes recorded in periods other than the settlement
period. Such fair value changes are not necessarily indicative of
the actual settlement value of the underlying hedge in the contract
settlement period, and therefore we remove this impact to allow
investors to better understand and analyze our core performance.
Settlements represent cash received or paid on hedge contracts
settled during the applicable period.
MTM adjustments on investments.
Unrealized gains/losses result from our equity investments that are
accounted for at fair value in non-operating expense. The
gains/losses are driven by changes in stock prices, foreign
currency fluctuations and other valuation techniques for
investments in companies without publicly-traded shares. Adjusting
for these gains/losses allows investors to better understand and
analyze our core operational performance in the periods shown.
Equity investment MTM adjustments. We
adjust for our proportionate share of our equity method investee,
Virgin Atlantic's, hedge portfolio MTM adjustments (recorded in
non-operating expense) to allow investors to understand and analyze
our core operational performance in the periods shown.
Aircraft fuel and related taxes. The
volatility in fuel prices impacts the comparability of
year-over-year financial performance. The adjustment for aircraft
fuel and related taxes allows investors to better understand and
analyze our non-fuel costs and year-over-year financial
performance.
Profit sharing. We adjust for profit
sharing because this adjustment allows investors to better
understand and analyze our recurring cost performance and provides
a more meaningful comparison of our core operating costs to the
airline industry.
Operating Revenue,
adjusted and Total Revenue Per Available Seat Mile ("TRASM"),
adjusted
|
|
|
|
Three Months Ended
|
|
4Q22 vs 4Q19
% Change
|
(in
millions)
|
December 31, 2022
|
December 31, 2019
|
March 31, 2019
|
|
Operating
revenue
|
$
13,435
|
$
11,439
|
$
10,472
|
|
|
Adjusted
for:
|
|
|
|
|
|
Third-party refinery
sales
|
(1,142)
|
(2)
|
(48)
|
|
|
Delta Private Jets
adjustment
|
—
|
(53)
|
(43)
|
|
|
Operating revenue,
adjusted
|
$
12,292
|
$
11,384
|
$
10,381
|
|
8 %
|
|
|
|
|
|
|
|
|
|
Year Ended
|
|
FY22 vs FY19
% Change
|
(in
millions)
|
December 31, 2022
|
December 31, 2021
|
December 31, 2019
|
|
Operating
revenue
|
$
50,582
|
$
29,899
|
$
47,007
|
|
|
Adjusted
for:
|
|
|
|
|
|
Third-party refinery
sales
|
(4,977)
|
(3,229)
|
(97)
|
|
|
Delta Private Jets
adjustment
|
—
|
—
|
(192)
|
|
|
Operating revenue,
adjusted
|
$
45,605
|
$
26,670
|
$
46,718
|
|
(2) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
4Q22 vs 4Q19
% Change
|
|
December 31, 2022
|
December 31, 2019
|
|
|
TRASM
(cents)
|
22.58
|
17.47
|
|
|
|
Adjusted
for:
|
|
|
|
|
|
Third-party refinery
sales
|
(1.92)
|
—
|
|
|
|
Delta Private Jets
adjustment
|
—
|
(0.08)
|
|
|
|
TRASM,
adjusted
|
20.66
|
17.39
|
|
|
19 %
|
|
|
|
|
|
|
|
|
|
Year Ended
|
|
|
FY22 vs FY19
% Change
|
|
December 31, 2022
|
December 31, 2019
|
|
|
TRASM
(cents)
|
21.69
|
17.07
|
|
|
|
Adjusted
for:
|
|
|
|
|
|
Third-party refinery
sales
|
(2.13)
|
(0.04)
|
|
|
|
Delta Private Jets
adjustment
|
—
|
(0.07)
|
|
|
|
TRASM,
adjusted
|
19.55
|
16.97
|
|
|
15 %
|
Operating Income,
adjusted
|
|
|
Three Months Ended
|
(in
millions)
|
December 31, 2022
|
December 31, 2019
|
Operating
Income
|
$
1,470
|
$
1,399
|
Adjusted
for:
|
|
|
Restructuring
charges
|
(118)
|
—
|
MTM adjustments and
settlements on hedges
|
70
|
22
|
Delta Private Jets
adjustment
|
—
|
2
|
Operating Income,
adjusted
|
$
1,422
|
$
1,423
|
|
Year Ended
|
(in
millions)
|
December 31, 2022
|
December 31, 2019
|
Operating
Income
|
$
3,661
|
$
6,618
|
Adjusted
for:
|
|
|
Restructuring
charges
|
(124)
|
—
|
MTM adjustments and
settlements on hedges
|
29
|
14
|
Delta Private Jets
adjustment
|
—
|
3
|
Operating Income,
adjusted
|
$
3,566
|
$
6,636
|
Operating Margin,
adjusted
|
|
|
|
|
Three Months Ended
|
|
December 31, 2022
|
December 31, 2019
|
Operating
margin
|
10.9 %
|
12.2 %
|
Adjusted
for:
|
|
|
Restructuring
charges
|
(0.9)
|
—
|
MTM adjustments and
settlements on hedges
|
0.5
|
0.2
|
Third-party refinery
sales
|
1.0
|
0.1
|
Operating margin,
adjusted
|
11.6 %
|
12.5 %
|
|
|
Year Ended
|
|
December 31, 2022
|
December 31, 2019
|
Operating
margin
|
7.2 %
|
14.1 %
|
Adjusted
for:
|
|
|
Restructuring
charges
|
(0.2)
|
—
|
MTM adjustments and
settlements on hedges
|
0.1
|
—
|
Third-party refinery
sales
|
0.8
|
0.1
|
Operating margin,
adjusted
|
7.8 %
|
14.2 %
|
Pre-Tax Income, Net
Income, and Diluted Earnings per Share, adjusted
|
|
|
|
|
|
|
Three Months Ended
|
|
Three Months Ended
|
|
December 31, 2022
|
|
December 31, 2022
|
|
Pre-Tax
|
Income
|
Net
|
|
Earnings
|
(in millions, except
per share data)
|
Income
|
Tax
|
Income
|
|
Per Diluted Share
|
GAAP
|
$
1,120
|
$
(292)
|
$
828
|
|
$
1.29
|
Adjusted
for:
|
|
|
|
|
|
Restructuring
charges
|
(118)
|
|
|
|
|
MTM adjustments and
settlements on hedges
|
70
|
|
|
|
|
MTM adjustments on
investments
|
170
|
|
|
|
|
Non-GAAP
|
$
1,242
|
$
(292)
|
$
950
|
|
$
1.48
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Three Months Ended
|
|
December 31, 2019
|
|
December 31, 2019
|
|
Pre-Tax
|
Income
|
Net
|
|
Earnings
|
(in millions, except
per share data)
|
Income
|
Tax
|
Income
|
|
Per Diluted Share
|
GAAP
|
$
1,397
|
$
(298)
|
$
1,099
|
|
$
1.71
|
Adjusted
for:
|
|
|
|
|
|
MTM adjustments and
settlements on hedges
|
22
|
|
|
|
|
Equity investment MTM
adjustments
|
(1)
|
|
|
|
|
MTM adjustments on
investments
|
(3)
|
|
|
|
|
Delta Private Jets
adjustment
|
2
|
|
|
|
|
Non-GAAP
|
$
1,417
|
$
(319)
|
$
1,098
|
|
$
1.70
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended
|
|
Year Ended
|
|
December 31, 2022
|
|
December 31, 2022
|
|
Pre-Tax
|
Income
|
Net
|
|
Earnings
|
(in millions, except
per share data)
|
Income
|
Tax
|
Income
|
|
Per Diluted Share
|
GAAP
|
$
1,914
|
$
(596)
|
$
1,318
|
|
$
2.06
|
Adjusted
for:
|
|
|
|
|
|
Restructuring
charges
|
(124)
|
|
|
|
|
MTM adjustments and
settlements on hedges
|
29
|
|
|
|
|
Loss on extinguishment
of debt
|
100
|
|
|
|
|
MTM adjustments on
investments
|
784
|
|
|
|
|
Non-GAAP
|
$
2,703
|
$
(650)
|
$
2,053
|
|
$
3.20
|
|
|
|
|
|
|
|
Year Ended
|
|
Year Ended
|
|
December 31, 2019
|
|
December 31, 2019
|
|
Pre-Tax
|
Income
|
Net
|
|
Earnings
|
(in millions, except
per share data)
|
Income
|
Tax
|
Income
|
|
Per Diluted Share
|
GAAP
|
$
6,198
|
$
(1,431)
|
$
4,767
|
|
$
7.30
|
Adjusted
for:
|
|
|
|
|
|
MTM adjustments and
settlements on hedges
|
14
|
|
|
|
|
Equity investment MTM
adjustments
|
(14)
|
|
|
|
|
MTM adjustments on
investments
|
13
|
|
|
|
|
Delta Private Jets
adjustment
|
3
|
|
|
|
|
Non-GAAP
|
$
6,214
|
$
(1,438)
|
$
4,776
|
|
$
7.32
|
Pre-Tax Margin,
adjusted
|
|
|
|
Three Months Ended
|
|
December 31, 2022
|
December 31, 2019
|
Pre-tax
margin
|
8.3 %
|
12.2 %
|
Adjusted
for:
|
|
|
Restructuring
charges
|
(0.9)
|
—
|
MTM adjustments and
settlements on hedges
|
0.5
|
0.2
|
MTM adjustments on
investments
|
1.3
|
—
|
Third-party refinery
sales
|
0.9
|
0.1
|
Pre-tax margin,
adjusted
|
10.1 %
|
12.4 %
|
|
|
|
|
|
|
|
|
|
|
Year Ended
|
|
December 31, 2022
|
December 31, 2019
|
Pre-tax
margin
|
3.8 %
|
13.2 %
|
Adjusted
for:
|
|
|
Restructuring
charges
|
(0.2)
|
—
|
Loss on extinguishment
of debt
|
0.2
|
—
|
MTM adjustments and
settlements on hedges
|
0.1
|
—
|
MTM adjustments on
investments
|
1.5
|
—
|
Third-party refinery
sales
|
0.6
|
0.1
|
Pre-tax margin,
adjusted
|
5.9 %
|
13.3 %
|
Operating Cash Flow, adjusted. We present operating cash
flow, adjusted because management believes adjusting for the
following item provides a more meaningful measure for
investors:
Net cash flows related to certain airport
construction projects and other. Cash flows related to certain
airport construction projects are included in our GAAP operating
activities. We have adjusted for these items, which were primarily
funded by cash restricted for airport construction, to provide
investors a better understanding of the company's operating cash
flow that are core to our operations in the periods shown.
|
|
|
|
Three Months Ended
|
(in
millions)
|
|
|
December 31, 2022
|
December 31, 2019
|
Net cash provided by
operating activities
|
|
$
1,189
|
$
969
|
Adjustments:
|
|
|
|
Net cash flows related
to certain airport construction projects and other
|
|
22
|
(133)
|
Net cash provided by
operating activities, adjusted
|
|
$
1,211
|
$
837
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended
|
(in
millions)
|
|
|
December 31, 2022
|
December 31, 2019
|
Net cash provided by
operating activities
|
|
$
6,364
|
$
8,425
|
Adjustments:
|
|
|
|
Net cash flows related
to certain airport construction projects and other
|
|
(154)
|
52
|
Net cash provided by
operating activities, adjusted
|
|
$
6,210
|
$
8,476
|
Free Cash Flow. We present free cash flow because
management believes this metric is helpful to investors to evaluate
the company's ability to generate cash that is available for use
for debt service or general corporate initiatives. Free cash flow
is also used internally as a component of our 2022 incentive
compensation program. Free cash flow is defined as net cash from
operating activities and net cash from investing activities,
adjusted for (i) net redemptions of short-term investments, (ii)
strategic investments and related, (iii) net cash flows related to
certain airport construction projects and other and (iv) financed
aircraft acquisitions. These adjustments are made for the following
reasons:
Net redemptions of short-term
investments. Net redemptions of short-term investments
represent the net purchase and sale activity of investments and
marketable securities in the period, including gains and losses. We
adjust for this activity to provide investors a better
understanding of the company's free cash flow generated by our
operations.
Strategic investments and related. Cash
flows related to our investments in and related transactions with
other airlines are included in our GAAP investing activities. We
adjust for this activity because it provides a more meaningful
comparison to our airline industry peers.
Net cash flows related to certain airport
construction projects and other. Cash flows related to certain
airport construction projects are included in our GAAP operating
activities and capital expenditures. We have adjusted for these
items, which were primarily funded by cash restricted for airport
construction, to provide investors a better understanding of the
company's free cash flow and capital expenditures that are core to
our operations in the periods shown.
Financed aircraft acquisitions. This
adjustment reflects aircraft deliveries that are leased as capital
expenditures. The adjustment is based on their original contractual
purchase price or an estimate of the aircraft's fair value and
provides a more meaningful view of our investing
activities.
|
|
|
|
Year Ended
|
(in
millions)
|
|
|
December 31, 2022
|
Net cash provided by
operating activities
|
|
$
6,364
|
Net cash used in
investing activities
|
|
(6,924)
|
Adjusted
for:
|
|
|
Net redemptions of
short-term investments
|
|
(100)
|
Strategic investments
and related
|
|
701
|
Net cash flows related
to certain airport construction projects and other
|
|
409
|
Financed aircraft
acquisitions
|
|
(206)
|
Free cash
flow
|
|
$
244
|
|
|
|
|
|
Adjusted Net Debt. Delta uses adjusted total debt,
including aircraft rent, in addition to adjusted debt and finance
leases, to present estimated financial obligations. Delta reduces
adjusted total debt by cash, cash equivalents and short-term
investments, and LGA restricted cash, resulting in adjusted net
debt, to present the amount of assets needed to satisfy the debt.
Management believes this metric is helpful to investors in
assessing the company's overall debt profile.
|
|
|
|
(in
millions)
|
|
December 31, 2022
|
December 31, 2019
|
Debt and finance lease
obligations
|
|
$
23,030
|
$
11,160
|
Plus: sale-leaseback
financing liabilities
|
|
2,180
|
—
|
Plus: unamortized
discount/(premium) and debt issue cost, net and other
|
|
138
|
(115)
|
Adjusted debt and
finance lease obligations
|
|
$
25,349
|
$
11,044
|
Plus: 7x last twelve
months' aircraft rent
|
|
3,558
|
2,963
|
Adjusted total
debt
|
|
$
28,906
|
$
14,007
|
Less: cash, cash
equivalents and short-term investments
|
|
(6,534)
|
(2,882)
|
Less: LGA restricted
cash
|
|
(69)
|
(636)
|
Adjusted net
debt
|
|
$
22,303
|
$
10,489
|
|
|
|
|
Adjusted Non-Fuel
Cost and Non-Fuel Unit Cost or Cost per Available Seat Mile,
("CASM-Ex")
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
4Q22 vs 4Q19
% Change
|
(in
millions)
|
|
December 31, 2022
|
December 31, 2019
|
|
|
|
Operating
Expense
|
$
11,965
|
$
10,040
|
|
|
|
|
Adjusted
for:
|
|
|
|
|
|
|
Restructuring
charges
|
118
|
—
|
|
|
|
|
Aircraft fuel and
related taxes
|
(2,849)
|
(2,012)
|
|
|
|
|
Third-party refinery
sales
|
(1,142)
|
(2)
|
|
|
|
|
Profit
sharing
|
(272)
|
(387)
|
|
|
|
|
Delta Private Jets
adjustment
|
—
|
(49)
|
|
|
|
|
Non-Fuel
Cost
|
$
7,821
|
$
7,590
|
|
|
|
3 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended
|
|
|
|
FY22 vs FY19
% Change
|
(in
millions)
|
|
December 31, 2022
|
December 31, 2019
|
|
|
|
Operating
Expense
|
$
46,921
|
$
40,389
|
|
|
|
|
Adjusted
for:
|
|
|
|
|
|
|
Restructuring
charges
|
124
|
—
|
|
|
|
|
Aircraft fuel and
related taxes
|
(11,482)
|
(8,519)
|
|
|
|
|
Third-party refinery
sales
|
(4,977)
|
(97)
|
|
|
|
|
Profit
sharing
|
(563)
|
(1,643)
|
|
|
|
|
Delta Private Jets
adjustment
|
—
|
(168)
|
|
|
|
|
Non-Fuel
Cost
|
$
30,024
|
$
29,962
|
|
|
|
— %
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
4Q22 vs 4Q19
% Change
|
|
|
|
December 31, 2022
|
September 30, 2022
|
December 31, 2019
|
September 30, 2019
|
|
CASM (cents)
|
20.11
|
19.87
|
15.34
|
13.85
|
|
|
Adjusted
for:
|
|
|
|
|
|
|
Restructuring
charges
|
0.20
|
—
|
—
|
—
|
|
|
Aircraft fuel and related
taxes
|
(4.78)
|
(5.26)
|
(3.08)
|
(2.96)
|
|
|
Third-party refinery
sales
|
(1.92)
|
(1.80)
|
—
|
(0.01)
|
|
|
Profit sharing
|
(0.46)
|
(0.38)
|
(0.59)
|
(0.68)
|
|
|
Delta Private Jets
adjustment
|
—
|
—
|
(0.07)
|
(0.05)
|
|
|
CASM-Ex
|
13.14
|
12.43
|
11.59
|
10.15
|
|
13 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended
|
|
|
|
FY22 vs FY19
% Change
|
|
|
|
December 31, 2022
|
December 31, 2019
|
|
|
|
CASM (cents)
|
20.12
|
14.67
|
|
|
|
|
Adjusted
for:
|
|
|
|
|
|
|
Restructuring
charges
|
0.05
|
—
|
|
|
|
|
Aircraft fuel and related
taxes
|
(4.92)
|
(3.10)
|
|
|
|
|
Third-party refinery
sales
|
(2.13)
|
(0.04)
|
|
|
|
|
Profit sharing
|
(0.24)
|
(0.60)
|
|
|
|
|
Delta Private Jets
adjustment
|
—
|
(0.06)
|
|
|
|
|
CASM-Ex
|
12.87
|
10.88
|
|
|
|
18 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Expense,
adjusted
|
|
|
|
|
|
Three Months Ended
|
(in
millions)
|
December 31, 2022
|
December 31, 2019
|
Operating
expense
|
$
11,965
|
$
10,040
|
Adjusted
for:
|
|
|
Restructuring
charges
|
118
|
—
|
MTM adjustments and
settlements on hedges
|
(70)
|
(22)
|
Third-party refinery
sales
|
(1,142)
|
(2)
|
Delta Private Jets
adjustment
|
—
|
(55)
|
Operating expense,
adjusted
|
$
10,871
|
$
9,961
|
|
|
|
|
|
Year Ended
|
(in
millions)
|
December 31, 2022
|
December 31, 2019
|
Operating
expense
|
$
46,921
|
$
40,389
|
Adjusted
for:
|
|
|
Restructuring
charges
|
124
|
—
|
MTM adjustments and
settlements on hedges
|
(29)
|
(14)
|
Third-party refinery
sales
|
(4,977)
|
(97)
|
Delta Private Jets
adjustment
|
—
|
(196)
|
Operating expense,
adjusted
|
$
42,039
|
$
40,082
|
|
|
|
Total fuel expense,
adjusted and Average fuel price per gallon, adjusted
|
|
|
|
|
|
|
|
|
|
|
|
Average Price Per Gallon
|
|
|
Three Months Ended
|
|
Three Months Ended
|
|
|
December 31,
|
December 31,
|
|
December 31,
|
December 31,
|
(in millions, except
per gallon data)
|
2022
|
2019
|
|
2022
|
2019
|
Total fuel
expense
|
$
2,849
|
$
2,012
|
|
$
3.28
|
$
2.01
|
Adjusted
for:
|
|
|
|
|
|
MTM adjustments and
settlements on hedges
|
(70)
|
(22)
|
|
(0.08)
|
(0.02)
|
Delta Private Jets
adjustment
|
—
|
(6)
|
|
—
|
(0.01)
|
Total fuel expense,
adjusted
|
$
2,778
|
$
1,983
|
|
$
3.20
|
$
1.99
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average Price Per Gallon
|
|
|
Year Ended
|
|
Year Ended
|
|
|
December 31,
|
December 31,
|
|
December 31,
|
December 31,
|
(in millions, except
per gallon data)
|
2022
|
2019
|
|
2022
|
2019
|
Total fuel
expense
|
$
11,482
|
$
8,519
|
|
$
3.36
|
$
2.02
|
Adjusted
for:
|
|
|
|
|
|
MTM adjustments and
settlements on hedges
|
(29)
|
(14)
|
|
(0.01)
|
—
|
Delta Private Jets
adjustment
|
—
|
(28)
|
|
—
|
(0.01)
|
Total fuel expense,
adjusted
|
$
11,453
|
$
8,477
|
|
$
3.36
|
$
2.01
|
Gross Capital Expenditures. We adjust capital
expenditures for the following items to determine gross capital
expenditures for the reasons described below:
Financed aircraft acquisitions. This
adjusts capital expenditures to reflect aircraft deliveries that
are leased as capital expenditures. The adjustment is based on
their original contractual purchase price or an estimate of the
aircraft's fair value and provides a more meaningful view of our
investing activities.
Net cash flows related to certain airport
construction projects. Cash flows related to certain airport
construction projects are included in capital expenditures. We have
adjusted for these items because management believes investors
should be informed that a portion of these capital expenditures
from airport construction projects are either funded with
restricted cash specific to these projects or reimbursed by a third
party.
|
|
Three Months Ended
|
(in
millions)
|
December 31, 2022
|
December 31, 2019
|
Flight equipment,
including advance payments
|
$
1,643
|
$
570
|
Ground property and
equipment, including technology
|
557
|
502
|
Adjusted
for:
|
|
|
Net cash flows related
to certain airport construction projects
|
(87)
|
(118)
|
Gross capital
expenditures
|
$
2,113
|
$
954
|
|
|
|
|
|
|
Year Ended
|
(in
millions)
|
December 31, 2022
|
December 31, 2019
|
Flight equipment,
including advance payments
|
$
4,495
|
$
3,344
|
Ground property and
equipment, including technology
|
1,871
|
1,592
|
Adjusted
for:
|
|
|
Financed aircraft
acquisitions
|
206
|
818
|
Net cash flows related
to certain airport construction projects
|
(564)
|
(448)
|
Gross capital
expenditures
|
$
6,008
|
$
5,306
|
|
|
|
|
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SOURCE Delta Air Lines