March quarter revenue and earnings results
in-line with guidance
Record March quarter operating cash flow
enabled accelerated debt reduction
Expect record June quarter revenue,
mid-teens operating margin, and EPS of $2.00 to $2.25
Reiterating 2023 outlook for significant
EPS growth to $5 to $6 and free cash flow of more than $2 billion
ATLANTA, April 13,
2023 /PRNewswire/ -- Delta Air Lines (NYSE:DAL) today
reported financial results for the March quarter and provided its
outlook for the June quarter 2023. Highlights of the March
quarter, including both GAAP and adjusted metrics, are on page five
and incorporated here.
"Thanks to the outstanding work and dedication of the Delta
team, 2023 is off to a strong start. We provided
well-deserved pay increases for our people and paid more profit
sharing than the rest of the industry combined. Delta is
building momentum, with the best people in the industry generating
nearly $5 billion of operating profit
over the last twelve months," said Ed
Bastian, Delta's chief executive officer. "For the
June quarter, we expect to deliver record revenue, and an adjusted
operating margin of 14 to 16 percent with earnings per share of
$2.00 to $2.25."
"With solid March quarter profitability and a strong outlook for
the June quarter, we are confident in our full-year guidance for
revenue growth of 15 to 20 percent year over year, earnings of
$5 to $6 per share and free cash flow of over
$2 billion," Bastian said.
March Quarter 2023 GAAP Financial Results
- Operating revenue of $12.8
billion
- Operating loss of $277 million
with an operating margin of (2.2) percent
- Pre-tax loss of $506 million with
a pre-tax margin of (4) percent
- EPS of ($0.57)
- Operating cash flow of $2.2
billion
- Payments on debt and finance lease obligations of $1.2 billion
- Total debt and finance lease obligations of $22 billion at quarter end
March Quarter 2023 Adjusted Financial Results
- Operating revenue of $11.8
billion, 45 percent higher than the March quarter 2022 and
14 percent higher than the March quarter 2019, including a 1 point
impact from flying lower capacity than initially planned
- Operating income of $546 million
with an operating margin of 4.6 percent
- Pre-tax income of $217 million
with a pre-tax margin of 1.8 percent
- Earnings per share of $0.25
- Operating cash flow of $2.9
billion
- Free cash flow of $1.9
billion
- $9.5 billion in liquidity* and
adjusted net debt of $21 billion at
quarter end
*
|
Includes cash and cash
equivalents, short-term investments and undrawn revolving credit
facilities
|
June Quarter and Full Year Outlook1
|
2Q23
Forecast
|
FY 2023
Forecast2
|
Total Revenue
YoY
|
+15% - 17%
|
+15% - 20%
|
Operating
Margin
|
14% - 16%
|
10% - 12%
|
Earnings Per
Share
|
$2.00 -
$2.25
|
$5 - $6
|
|
|
1
|
Non-GAAP measures;
Refer to Non-GAAP reconciliations for comparison figures
|
2
|
Reiteration of FY2023
guidance initially provided in December 2022
|
Additional metrics for financial modeling can be found in the
Supplemental Information section under Quarterly Results on
ir.delta.com.
Revenue Environment and Outlook
"We delivered record March quarter revenue with total unit
revenue that was 16 percent higher than the same period in
2019. These results reflect the strength in the underlying
demand environment and continued momentum in premium products and
loyalty revenue," said Glen
Hauenstein, Delta's president. "With record advance
bookings for the summer, we expect June quarter revenue to be 15 to
17 percent higher on capacity growth of 17 percent year over
year."
- Unit revenue strength continues, driven by consumer:
Reflecting strong demand, March quarter advance cash bookings were
nearly 20 percent higher than 2019. March quarter adjusted total
unit revenue (TRASM) was up 16 percent versus 2019 and 23 percent
higher versus 2022.
- Revenue diversification continues on Premium and Loyalty
momentum: Revenue from Premium products and diverse revenue
streams in the March quarter was 56 percent of adjusted operating
revenue. Premium revenue growth continues to outpace main cabin.
Loyalty revenue improvement was driven by strong co-brand
acquisitions and spend growth, with American Express remuneration
for the March quarter a record $1.7
billion, approximately 38 percent higher year over
year.
- Business travel improvement led by International and small
and medium-sized business demand: Small and medium business
bookings stepped up in the March quarter to fully recovered versus
2019 levels. International Corporate sales* accelerated
sequentially to approximately 90 percent recovered to 2019 levels,
excluding China. Domestic Corporate sales* in the March quarter
were approximately 85 percent recovered to 2019 levels. Recent
corporate survey results indicate that 96 percent of companies
expect their travel will increase or stay the same sequentially in
the June quarter.
*
|
Corporate sales include
tickets sold to corporate contracted customers, including tickets
for travel during and beyond the referenced time period
|
Cost Performance and Outlook
"Non-fuel costs are progressing as expected. For the June
quarter, we expect non-fuel unit costs to be 1 to 3 percent higher
year over year," said Dan Janki,
Delta's chief financial officer. "We remain confident in our
ability to deliver unit cost declines in the second half of 2023,
while generating industry-leading operating margins of 10 to 12
percent for the full year."
March Quarter 2023 Cost Performance
- March quarter operating expense of $13.0
billion and total adjusted operating expense of $11.3 billion
- March quarter adjusted non-fuel costs of $8.5 billion
- March quarter non-fuel CASM was 4.7 percent higher year over
year, including a 1 point impact from flying lower capacity than
initially planned primarily due to winter storms
- Adjusted fuel expense of $2.7
billion was up 30 percent compared to the March quarter
2022
- Adjusted fuel price of $3.06 per
gallon includes a refinery benefit of 25¢ per gallon
- Fuel efficiency, defined as gallons per 1,000 ASMs, was 14.5, a
6 percent improvement versus 2019
Balance Sheet, Cash and Liquidity
"Record March quarter free cash flow of $1.9 billion enabled $1.2 billion of debt repayment and positions
us to complete our full year planned debt reduction in the first
half of the year," Janki said. "We are on track to reduce
leverage to 3x to 3.5x in 2023 and remain committed to returning to
investment grade metrics by next year. The recent upgrades on
our debt rating outlooks by S&P and Fitch recognize our
continued progress on delevering our balance sheet."
- Adjusted net debt of $21 billion
at March quarter end, a reduction of $1.3
billion from the end of 2022
- Payments on debt and finance lease obligations of $1.2 billion in the March quarter. This included
$455 million of maturities and
$695 million of accelerated
repurchases of debt instruments with an average interest rate of 7
percent
- Weighted average interest rate of 4.7 percent with 85 percent
fixed rate debt and 15 percent variable rate debt
- Adjusted operating cash flow was a March quarter record of
$2.9 billion, and with gross capital
expenditures of $1.1 billion, free
cash flow was $1.9 billion
- Air Traffic Liability ended the quarter at $11.2 billion, up $2.9
billion compared to the end of 2022
- Liquidity of $9.5 billion at
quarter-end, including $2.9 billion
in undrawn revolver capacity
March Quarter Highlights
Operations and Fleet
- Earned the Cirium Platinum Award for global operational
excellence as North America's most
on-time airline, reflecting Delta's leading on-time performance
while limiting disruption to customers
- Achieved network system on-time arrivals of 81 percent in the
quarter, the most on-time among U.S. carriers reporting to the
DOT1
- Named top U.S. airline by Wall Street Journal for 2022,
ranking No. 1 in three of seven categories, including operations
and fleet
- Opened state-of-the-art Pratt & Whitney Geared Turbofan
engine maintenance shop, supporting long-term MRO growth
- Took delivery of 6 new aircraft in the quarter, 4 of which were
A321neos
Culture and People
- Celebrated Delta people with $563
million in profit sharing for 2022 performance, paid on
Valentine's Day
- Honored by Fortune as one of the World's Most Admired
Companies for the 10th year in a row, climbing six spots to No.
12
- Announced a 5 percent base pay increase for eligible employees
worldwide, effective April 1, 2023,
maintaining our philosophy of industry-leading pay for
industry-leading performance
- Delta pilots ratified a new 4-year Pilot Working Agreement,
maintaining our premium position in pilot pay
- Ranked the top airline on Glassdoor's "Best Places to Work"
list for the seventh year
- Announced a new pilot academy, The Delta Propel Flight Academy,
offering up to $20k in financial
support
- Partnered with Operation HOPE and Fidelity Investments to help
employees earn $1,000 in emergency
savings as part of an educational and coaching program
Customer Experience and Loyalty
- Welcomed 3 million new SkyMiles members in the quarter, marking
a new quarterly record
- Achieved record American Express remuneration and co-brand card
acquisitions, with increasing mix of premium card acquisitions
- Introduced fast, free Wi-Fi on Feb.
1, with full availability across Delta's global fleet
planned by the end of 2024
- Claimed the No. 8 spot on Fast Company's list of Most
Innovative Companies in the travel category
- In partnership with Hertz, announced enhanced SkyMiles rewards
based on spend on car rentals booked on Delta.com or the Fly Delta
App; SkyMiles members can also earn from bookings through Hertz
channels
- Consolidated operations in JFK to Terminal 4, with 10 new gates
now open on Concourse A with upgrades from check-in to gate
areas
- Unveiled a new, state-of-the-art cargo cooler facility at JFK,
the largest of its kind on-site, offering an upgraded experience
for customers with temperature-sensitive cargo
- Announced Delta will be the only U.S. carrier to offer service
between Los Angeles and
Auckland, New Zealand beginning
this fall
- Refreshed onboard food and beverage menu, featuring the return
of the signature Delta One dessert cart, espresso martinis and
premium rosé wine
- As part of the Delta-LATAM Joint Venture, announced the launch
of daily service from JFK to Rio de
Janeiro starting in December
2023
- Opened Delta's new Sky Club at Kansas
City's recently transformed international airport, deepening
ties in the Midwest as the only carrier lounge at the airport
Environmental, Social and Governance
- Improved fuel efficiency by 6 percent in the March quarter
versus 2019 through fleet renewal and other sustainability
initiatives
- Outlined Delta's path to net zero-emissions and more
sustainable travel by 2050, including the sustainable fuel market,
innovating fleet, addressing single-use plastics and encouraging
net-zero supply chains
- Added Elizabeth City State
University as a partner school in the Delta Propel Program,
emphasizing Delta's commitment to strengthening the workforce
pipeline and creating equitable opportunities in aviation
- Honored National Slavery and Human Trafficking Awareness Month
this January with a variety of initiatives to educate and empower
our people and our customers to take action against human
trafficking
- Presented with UNCF's Keeper of the Flame Award for outstanding
support of their mission to help historically Black colleges and
universities prepare students who will become future leaders of our
nation
1
|
Based on FlightStats
data for A14 arrival system-wide for flights flown Jan. 1 – Mar.
31, 2023, compared to US carriers reporting to the DOT
|
March Quarter Results
March quarter results have been adjusted primarily for
the third-party refinery sales, one-time expenses related
to the new pilot agreement, unrealized gains on investments and
loss on extinguishment of debt as described in the reconciliations
in Note A.
|
|
GAAP
|
$
Change
|
%
Change
|
($ in millions except
per share and unit costs)
|
1Q23
|
1Q22
|
Operating
loss
|
(277)
|
(783)
|
506
|
65 %
|
Operating
margin
|
(2.2) %
|
(8.4) %
|
6.2 pts
|
74 %
|
Pre-tax loss
|
(506)
|
(1,200)
|
694
|
58 %
|
Pre-tax
margin
|
(4.0) %
|
(12.8) %
|
8.8 pts
|
69 %
|
Net loss
|
(363)
|
(940)
|
577
|
61 %
|
Loss per
share
|
(0.57)
|
(1.48)
|
0.91
|
61 %
|
Operating
revenue
|
12,759
|
9,348
|
3,411
|
36 %
|
Total revenue per
available seat mile (TRASM) (cents)
|
20.80
|
18.04
|
2.76
|
15 %
|
Operating
expense
|
13,036
|
10,131
|
2,905
|
29 %
|
Cost per available seat
mile (CASM) (cents)
|
21.25
|
19.56
|
1.69
|
9 %
|
Fuel expense
|
2,676
|
2,092
|
584
|
28 %
|
Average fuel price per
gallon
|
3.01
|
2.79
|
0.22
|
8 %
|
Operating cash
flow
|
2,235
|
1,771
|
464
|
26 %
|
Capital
expenditures
|
1,000
|
1,766
|
(766)
|
(43) %
|
Total debt and finance
lease obligations
|
21,958
|
25,557
|
(3,599)
|
(14) %
|
|
|
Adjusted
|
$
Change
|
%
Change
|
($ in millions except
per share and unit costs)
|
1Q23
|
1Q22
|
Operating
income/(loss)
|
546
|
(793)
|
1,339
|
NM
|
Operating
margin
|
4.6 %
|
(9.7) %
|
14.3
pts
|
NM
|
Pre-tax
income/(loss)
|
217
|
(1,037)
|
1,254
|
NM
|
Pre-tax
margin
|
1.8 %
|
(12.7) %
|
14.5
pts
|
NM
|
Net
income/(loss)
|
163
|
(784)
|
947
|
NM
|
Diluted earnings/(loss)
per share
|
0.25
|
(1.23)
|
1.48
|
NM
|
Operating
revenue
|
11,842
|
8,161
|
3,681
|
45 %
|
TRASM
(cents)
|
19.30
|
15.75
|
3.55
|
23 %
|
Operating
expense
|
11,296
|
8,954
|
2,342
|
26 %
|
Non-fuel
cost
|
8,506
|
6,858
|
1,648
|
24 %
|
Non-fuel unit cost
(CASM-Ex) (cents)
|
13.86
|
13.24
|
0.62
|
4.7 %
|
Fuel expense
|
2,718
|
2,097
|
621
|
30 %
|
Average fuel price per
gallon
|
3.06
|
2.79
|
0.27
|
10 %
|
Operating cash
flow
|
2,942
|
1,758
|
1,184
|
67 %
|
Free cash
flow
|
1,853
|
197
|
1,656
|
NM
|
Gross capital
expenditures
|
1,090
|
1,565
|
(475)
|
(30) %
|
Adjusted net
debt
|
20,964
|
20,863
|
101
|
— %
|
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 tailored to every customer. 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 safely serving as many as 200 million
customers annually, with industry-leading customer service,
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. It has
been recognized by Cirium for operational excellence, as the top
U.S. airline by the Wall Street Journal, among Fast Company's most
innovative companies, the World's Most Admired Airline according to
Fortune, as one of Glassdoor's Best Places to Work, and a top
employer for diversity, veterans and best workplaces for women by
Forbes.
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 impact of
incurring significant debt in response to the COVID-19 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,
which could compromise the data stored within them, as well as
failure to comply with ever-evolving global privacy and security
regulatory obligations or adequately address increasing customer
focus on privacy issues and data security; 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 on our business of seasonality
and other factors beyond our control, including severe weather
conditions, natural disasters or other environmental events,
including from the impact of climate change; 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; significant
damage to our reputation and brand, including from exposure to
significant adverse publicity or inability to achieve certain
sustainability goals; our ability to retain senior management and
other key employees, and to maintain our company culture; disease
outbreaks, such as the COVID-19 pandemic or similar public health
threats, and measures implemented to combat them; 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, 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
|
|
|
|
March
31,
|
|
|
(in millions, except
per share data)
|
2023
|
2022
|
$
Change
|
%
Change
|
Operating
Revenue:
|
|
|
|
|
Passenger
|
$ 10,411
|
$
6,907
|
$
3,504
|
51 %
|
Cargo
|
209
|
289
|
(80)
|
(28) %
|
Other
|
2,139
|
2,152
|
(13)
|
(1) %
|
Total operating
revenue
|
12,759
|
9,348
|
3,411
|
36 %
|
|
|
|
|
|
Operating
Expense:
|
|
|
|
|
Salaries and related
costs
|
3,386
|
2,826
|
560
|
20 %
|
Aircraft fuel and
related taxes
|
2,676
|
2,092
|
584
|
28 %
|
Ancillary businesses
and refinery
|
1,125
|
1,382
|
(257)
|
(19) %
|
Contracted
services
|
1,010
|
753
|
257
|
34 %
|
Pilot agreement and
related expenses
|
864
|
—
|
864
|
NM
|
Aircraft maintenance
materials and outside repairs
|
585
|
465
|
120
|
26 %
|
Landing fees and other
rents
|
584
|
504
|
80
|
16 %
|
Depreciation and
amortization
|
564
|
506
|
58
|
11 %
|
Regional carrier
expense
|
559
|
491
|
68
|
14 %
|
Passenger commissions
and other selling expenses
|
500
|
312
|
188
|
60 %
|
Passenger
service
|
416
|
275
|
141
|
51 %
|
Aircraft
rent
|
132
|
122
|
10
|
8 %
|
Profit
sharing
|
72
|
—
|
72
|
NM
|
Other
|
563
|
403
|
160
|
40 %
|
Total operating
expense
|
13,036
|
10,131
|
2,905
|
29 %
|
|
|
|
|
|
Operating
Loss
|
(277)
|
(783)
|
506
|
(65) %
|
|
|
|
|
|
Non-Operating
Expense:
|
|
|
|
|
Interest expense,
net
|
(227)
|
(274)
|
47
|
(17) %
|
Gain/(loss) on
investments, net
|
122
|
(147)
|
269
|
NM
|
Loss on extinguishment
of debt
|
(22)
|
(25)
|
3
|
(12) %
|
Pension and related
(expense)/benefit
|
(61)
|
73
|
(134)
|
NM
|
Miscellaneous,
net
|
(41)
|
(44)
|
3
|
(7) %
|
Total non-operating
expense, net
|
(229)
|
(417)
|
188
|
(45) %
|
|
|
|
|
|
Loss Before Income
Taxes
|
(506)
|
(1,200)
|
694
|
(58) %
|
|
|
|
|
|
Income Tax
Benefit
|
143
|
260
|
(117)
|
(45) %
|
|
|
|
|
|
Net
Loss
|
$
(363)
|
$
(940)
|
$
577
|
(61) %
|
|
|
|
|
|
Basic Loss Per
Share
|
$
(0.57)
|
$
(1.48)
|
|
|
Diluted Loss Per
Share
|
$
(0.57)
|
$
(1.48)
|
|
|
|
|
|
|
|
Basic Weighted
Average Shares Outstanding
|
639
|
637
|
|
|
Diluted Weighted
Average Shares Outstanding
|
639
|
637
|
|
|
|
|
|
|
|
|
DELTA AIR LINES,
INC.
|
Passenger
Revenue
|
(Unaudited)
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
March
31,
|
|
|
(in
millions)
|
2023
|
2022
|
|
$
Change
|
%
Change
|
Ticket - Main
cabin
|
$
5,223
|
$
3,448
|
|
$
1,775
|
51 %
|
Ticket - Premium
products
|
4,016
|
2,538
|
|
1,478
|
58 %
|
Loyalty travel
awards
|
743
|
543
|
|
200
|
37 %
|
Travel-related
services
|
429
|
378
|
|
51
|
13 %
|
Total passenger
revenue
|
$ 10,411
|
$
6,907
|
|
$
3,504
|
51 %
|
|
DELTA AIR LINES,
INC.
|
Other
Revenue
|
(Unaudited)
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
March
31,
|
|
|
(in
millions)
|
2023
|
2022
|
$
Change
|
%
Change
|
Refinery
|
$
916
|
$
1,187
|
$
(271)
|
(23) %
|
Loyalty
program
|
726
|
571
|
155
|
27 %
|
Ancillary
businesses
|
231
|
209
|
22
|
11 %
|
Miscellaneous
|
266
|
185
|
81
|
44 %
|
Total other
revenue
|
$
2,139
|
$
2,152
|
$
(13)
|
(1) %
|
DELTA AIR LINES,
INC.
|
Total
Revenue
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase
(Decrease)
|
|
|
|
|
1Q23 vs
1Q22
|
Revenue
|
|
1Q23
($M)
|
|
Change
|
Unit
Revenue
|
Yield
|
Capacity
|
Domestic
|
$
|
7,594
|
|
37 %
|
27 %
|
21 %
|
7 %
|
Atlantic
|
|
1,244
|
|
131 %
|
38 %
|
20 %
|
67 %
|
Latin
America
|
|
1,132
|
|
66 %
|
50 %
|
33 %
|
11 %
|
Pacific
|
|
441
|
|
253 %
|
79 %
|
(19) %
|
97 %
|
Total
Passenger
|
$
|
10,411
|
|
51 %
|
27 %
|
17 %
|
18 %
|
Cargo
Revenue
|
|
209
|
|
(28) %
|
|
|
|
Other
Revenue
|
|
2,139
|
|
(1) %
|
|
|
|
Total
Revenue
|
$
|
12,759
|
|
36 %
|
15 %
|
|
|
Third Party
Refinery Sales
|
|
(916)
|
|
|
|
|
|
Total Revenue,
adjusted
|
$
|
11,842
|
|
45 %
|
23 %
|
|
|
|
|
|
|
|
|
|
|
DELTA AIR LINES,
INC. Statistical
Summary (Unaudited)
|
|
|
Three Months
Ended
|
|
|
|
March
31,
|
|
|
|
2023
|
2022
|
Change
|
Revenue passenger miles
(millions)
|
49,687
|
38,700
|
28
|
%
|
Available seat miles
(millions)
|
61,351
|
51,810
|
18
|
%
|
Passenger mile yield
(cents)
|
20.95
|
17.85
|
17
|
%
|
Passenger revenue per
available seat mile (cents)
|
16.97
|
13.33
|
27
|
%
|
Total revenue per
available seat mile (cents)
|
20.80
|
18.04
|
15
|
%
|
TRASM, adjusted - see
Note A (cents)
|
19.30
|
15.75
|
23
|
%
|
Cost per available seat
mile (cents)
|
21.25
|
19.56
|
9
|
%
|
CASM-Ex - see
Note A (cents)
|
13.86
|
13.24
|
5
|
%
|
Passenger load
factor
|
81 %
|
75 %
|
6
|
pts
|
Fuel gallons consumed
(millions)
|
888
|
751
|
18
|
%
|
Average price per fuel
gallon
|
$
3.01
|
$
2.79
|
8
|
%
|
Average price per fuel
gallon, adjusted - see Note A
|
$
3.06
|
$
2.79
|
10
|
%
|
DELTA AIR LINES,
INC.
|
|
Consolidated
Statements of Cash Flows
|
|
(Unaudited)
|
|
|
Three Months
Ended
|
|
|
March
31,
|
|
(in
millions)
|
2023
|
2022
|
|
Cash Flows From
Operating Activities:
|
|
|
|
Net Loss
|
$
(363)
|
$
(940)
|
|
Depreciation and
amortization
|
564
|
506
|
|
Changes in air traffic
liability
|
2,927
|
2,751
|
|
Changes in profit
sharing
|
(491)
|
(108)
|
|
Changes in balance
sheet and other, net
|
(402)
|
(438)
|
|
Net cash provided by
operating activities
|
2,235
|
1,771
|
|
|
|
|
|
Cash Flows From
Investing Activities:
|
|
|
|
Property and equipment
additions:
|
|
|
|
Flight equipment,
including advance payments
|
(630)
|
(1,276)
|
|
Ground property and
equipment, including technology
|
(370)
|
(490)
|
|
Purchase of short-term
investments
|
(999)
|
(226)
|
|
Redemption of
short-term investments
|
897
|
1,346
|
|
Purchase of equity
investments
|
—
|
(100)
|
|
Other, net
|
2
|
(3)
|
|
Net cash used in
investing activities
|
(1,100)
|
(749)
|
|
|
|
|
|
Cash Flows From
Financing Activities:
|
|
|
|
Payments on debt and
finance lease obligations
|
(1,166)
|
(1,443)
|
|
Other, net
|
(13)
|
(13)
|
|
Net cash used in
financing activities
|
(1,179)
|
(1,456)
|
|
|
|
|
|
Net Decrease in
Cash, Cash Equivalents and Restricted Cash
Equivalents
|
(44)
|
(434)
|
|
Cash, cash equivalents
and restricted cash equivalents at beginning of period
|
3,473
|
$
8,569
|
|
Cash, cash equivalents
and restricted cash equivalents at end of period
|
$
3,429
|
$
8,135
|
|
|
|
|
|
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
|
$
3,215
|
$
7,705
|
|
Restricted cash included in
prepaid expenses and other
|
160
|
170
|
|
Other
assets:
|
|
|
|
Restricted cash included in
other noncurrent assets
|
54
|
260
|
|
Total cash, cash
equivalents and restricted cash equivalents
|
$
3,429
|
$
8,135
|
|
|
|
|
|
|
|
|
|
|
DELTA AIR LINES,
INC.
|
Consolidated Balance
Sheets
|
(Unaudited)
|
|
|
|
|
|
|
|
March
31,
|
|
December
31,
|
(in
millions)
|
2023
|
|
2022
|
ASSETS
|
Current
Assets:
|
|
|
|
|
Cash and cash
equivalents
|
$
3,215
|
|
$
3,266
|
|
Short-term
investments
|
3,396
|
|
3,268
|
|
Accounts receivable,
net
|
3,224
|
|
3,176
|
|
Fuel inventory,
expendable parts and supplies inventories, net
|
1,379
|
|
1,424
|
|
Prepaid expenses and
other
|
2,187
|
|
1,877
|
|
Total current
assets
|
13,401
|
|
13,011
|
|
|
|
|
|
Property and
Equipment, Net:
|
|
|
|
|
Property and equipment,
net
|
33,249
|
|
33,109
|
|
|
|
|
|
Other
Assets:
|
|
|
|
|
Operating lease
right-of-use assets
|
7,067
|
|
7,036
|
|
Goodwill
|
9,753
|
|
9,753
|
|
Identifiable
intangibles, net
|
5,990
|
|
5,992
|
|
Equity
investments
|
2,249
|
|
2,128
|
|
Deferred income taxes,
net
|
432
|
|
325
|
|
Other noncurrent
assets
|
993
|
|
934
|
|
Total other
assets
|
26,484
|
|
26,168
|
Total assets
|
$
73,134
|
|
$
72,288
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
Current
Liabilities:
|
|
|
|
|
Current maturities of
debt and finance leases
|
$
2,136
|
|
$
2,359
|
|
Current maturities of
operating leases
|
724
|
|
714
|
|
Air traffic
liability
|
11,187
|
|
8,160
|
|
Accounts
payable
|
4,754
|
|
5,106
|
|
Accrued salaries and
related benefits
|
2,828
|
|
3,288
|
|
Loyalty program
deferred revenue
|
3,685
|
|
3,434
|
|
Fuel card
obligation
|
1,100
|
|
1,100
|
|
Other accrued
liabilities
|
2,003
|
|
1,779
|
|
Total current
liabilities
|
28,417
|
|
25,940
|
|
|
|
|
|
Noncurrent
Liabilities:
|
|
|
|
|
Debt and finance
leases
|
19,823
|
|
20,671
|
|
Pension, postretirement
and related benefits
|
3,730
|
|
3,707
|
|
Loyalty program
deferred revenue
|
4,413
|
|
4,448
|
|
Noncurrent operating
leases
|
6,877
|
|
6,866
|
|
Other noncurrent
liabilities
|
3,614
|
|
4,074
|
|
Total noncurrent
liabilities
|
38,457
|
|
39,766
|
|
|
|
|
|
Commitments and
Contingencies
|
|
|
|
|
|
|
|
|
Stockholders'
Equity:
|
6,260
|
|
6,582
|
Total liabilities and
stockholders' equity
|
$
73,134
|
|
$
72,288
|
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 made to provide comparability
between the reported periods, if applicable, and for the reasons
indicated below:
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.
One-time pilot agreement
expenses. In March 2023,
Delta pilots ratified a new four-year Pilot Working Agreement
effective January 1, 2023. The
agreement includes numerous work rule changes and pay rate
increases during the four-year term, including an initial pay rate
increase of 18%. The agreement also includes a provision for a
one-time payment upon ratification in the March 2023 quarter of $735 million.
Additionally, we recorded adjustments to other benefit-related
items of approximately $130 million. Adjusting for these
expenses allows investors to better understand and analyze our core
cost performance.
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.
During 2022, we recognized adjustments to certain of those
restructuring charges, representing changes in our estimates.
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.
Loss on extinguishment of debt. This
adjustment relates to early termination of a portion of our
debt.
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.
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
Income/(Loss), adjusted
|
|
|
Three Months
Ended
|
|
March
31,
|
December
31,
|
September
30,
|
June
30,
|
March
31,
|
(in
millions)
|
2023
|
2022
|
2022
|
2022
|
2022
|
Operating
(Loss)/Income
|
$
(277)
|
$
1,470
|
$
1,456
|
$
1,519
|
$
(783)
|
Adjusted
for:
|
|
|
|
|
|
MTM adjustments and
settlements on hedges
|
(41)
|
70
|
36
|
(73)
|
(4)
|
One-time pilot
agreement expenses
|
864
|
—
|
—
|
—
|
—
|
Restructuring
charges
|
—
|
(118)
|
1
|
(1)
|
(5)
|
Operating
Income/(Loss), adjusted
|
$
546
|
$
1,422
|
$
1,492
|
$
1,445
|
$
(793)
|
|
|
|
|
|
|
Twelve months ended
March 31, 2023 operating income,
adjusted:
|
$
4,905
|
|
|
|
|
Operating Revenue,
adjusted and Total Revenue Per Available Seat Mile
("TRASM"), adjusted
|
|
|
Three Months
Ended
|
|
1Q23 vs
1Q22
|
1Q23 vs
1Q19
|
(in
millions)
|
March 31,
2023
|
June 30,
2022
|
March 31,
2022
|
March 31,
2019
|
|
%
Change
|
%
Change
|
Operating
revenue
|
$
12,759
|
$
13,824
|
$
9,348
|
$
10,472
|
|
|
|
Adjusted
for:
|
|
|
|
|
|
|
|
Third-party refinery
sales
|
(916)
|
(1,514)
|
(1,187)
|
(48)
|
|
|
|
Delta Private Jets
adjustment
|
—
|
—
|
—
|
(43)
|
|
|
|
Operating revenue,
adjusted
|
$
11,842
|
$
12,311
|
$
8,161
|
$
10,381
|
|
45 %
|
14 %
|
|
Year
Ended
|
(in
millions)
|
December 31,
2022
|
Operating
revenue
|
$
50,582
|
Adjusted
for:
|
|
Third-party refinery
sales
|
(4,977)
|
Operating revenue,
adjusted
|
$
45,605
|
|
Three Months
Ended
|
|
1Q23 vs
1Q22
|
1Q23 vs
1Q19
|
|
March 31,
2023
|
March 31,
2022
|
March 31,
2019
|
|
%
Change
|
%
Change
|
TRASM
(cents)
|
20.80
|
18.04
|
16.78
|
|
|
|
Adjusted
for:
|
|
|
|
|
|
|
Third-party refinery
sales
|
(1.49)
|
(2.29)
|
(0.08)
|
|
|
|
Delta Private Jets
adjustment
|
—
|
—
|
(0.07)
|
|
|
|
TRASM,
adjusted
|
19.30
|
15.75
|
16.63
|
|
23 %
|
16 %
|
Operating Margin,
adjusted
|
|
|
Three Months
Ended
|
|
March 31,
2023
|
March 31,
2022
|
Operating
margin
|
(2.2) %
|
(8.4) %
|
Adjusted
for:
|
|
|
MTM adjustments and
settlements on hedges
|
(0.3)
|
—
|
Third-party refinery
sales
|
0.3
|
(1.2)
|
One-time pilot
agreement expenses
|
6.8
|
—
|
Restructuring
charges
|
—
|
(0.1)
|
Operating margin,
adjusted
|
4.6 %
|
(9.7) %
|
Pre-Tax
(Loss)/Income, Net (Loss)/Income, and (Loss)/Diluted Earnings
per Share, adjusted
|
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
March 31,
2023
|
|
March 31,
2023
|
|
Pre-Tax
|
Income
|
Net
|
|
(Loss)/Earnings
|
(in millions, except
per share data)
|
(Loss)/Income
|
Tax
|
(Loss)/Income
|
|
Per Diluted
Share
|
GAAP
|
$
(506)
|
$
143
|
$
(363)
|
|
$
(0.57)
|
Adjusted
for:
|
|
|
|
|
|
Loss on extinguishment
of debt
|
22
|
|
|
|
|
MTM adjustments and
settlements on hedges
|
(41)
|
|
|
|
|
MTM adjustments on
investments
|
(122)
|
|
|
|
|
One-time pilot
agreement expenses
|
864
|
|
|
|
|
Non-GAAP
|
$
217
|
$
(53)
|
$
163
|
|
$
0.25
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
March 31,
2022
|
|
March 31,
2022
|
|
Pre-Tax
|
Income
|
Net
|
|
Loss
|
(in millions, except
per share data)
|
Loss
|
Tax
|
Loss
|
|
Per Diluted
Share
|
GAAP
|
$
(1,200)
|
$
260
|
$
(940)
|
|
$
(1.48)
|
Adjusted
for:
|
|
|
|
|
|
Loss on extinguishment
of debt
|
25
|
|
|
|
|
MTM adjustments and
settlements on hedges
|
(4)
|
|
|
|
|
MTM adjustments on
investments
|
148
|
|
|
|
|
Restructuring
charges
|
(5)
|
|
|
|
|
Non-GAAP
|
$
(1,037)
|
$
253
|
$
(784)
|
|
$
(1.23)
|
Pre-Tax Margin,
adjusted
|
|
|
Three Months
Ended
|
|
March 31,
2023
|
March 31,
2022
|
Pre-tax
margin
|
(4.0) %
|
(12.8) %
|
Adjusted
for:
|
|
|
Loss on extinguishment
of debt
|
0.2
|
0.3
|
MTM adjustments and
settlements on hedges
|
(0.3)
|
—
|
MTM adjustments on
investments
|
(1.0)
|
1.6
|
Third-party refinery
sales
|
0.1
|
(1.6)
|
One-time pilot
agreement expenses
|
6.8
|
—
|
Restructuring
charges
|
—
|
(0.1)
|
Pre-tax margin,
adjusted
|
1.8 %
|
(12.7) %
|
Operating Cash Flow, adjusted. We present operating
cash flow, adjusted because management believes adjusting for the
following items 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 is core to our operations in the periods shown.
Pilot agreement payment. In
March 2023, Delta pilots ratified a
new four-year Pilot Working Agreement effective January 1, 2023. The agreement includes numerous
work rule changes and pay rate increases during the four-year term,
including an initial pay rate increase of 18%. The agreement also
includes a provision for a one-time payment upon ratification in
the March 2023 quarter of
$735 million. We adjust for this item to provide investors a
better understanding of our recurring cash flow generated by our
operations.
|
Three Months
Ended
|
(in
millions)
|
March 31,
2023
|
March 31,
2022
|
Net cash provided by
operating activities
|
$
2,235
|
$
1,771
|
Adjustments:
|
|
|
Net cash flows related
to certain airport construction projects and other
|
(28)
|
(13)
|
Pilot agreement
payment
|
735
|
—
|
Net cash provided by
operating activities, adjusted
|
$
2,942
|
$
1,758
|
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 2023 incentive
compensation program. Free cash flow is defined as net cash from
operating activities and net cash from investing activities,
adjusted for (i) net purchases/(redemptions) of short-term
investments, (ii) strategic investments and related, (iii) net cash
flows related to certain airport construction projects and other,
(iv) financed aircraft acquisitions and (v) pilot agreement
payment. These adjustments are made for the following reasons:
Net purchases/(redemptions) of short-term
investments. Net purchases/(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. Certain 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.
Pilot agreement payment. In
March 2023, Delta pilots ratified a
new four-year Pilot Working Agreement effective January 1, 2023. The agreement includes numerous
work rule changes and pay rate increases during the four-year
term, including an initial pay rate increase of 18%. The agreement
also includes a provision for a one-time payment upon ratification
in the March 2023 quarter of
$735 million. We adjust for this item to provide investors a
better understanding of our recurring free cash flow generated by
our operations.
|
Three Months
Ended
|
(in
millions)
|
March 31,
2023
|
March 31,
2022
|
Net cash provided by
operating activities
|
$
2,235
|
$
1,771
|
Net cash used in
investing activities
|
(1,100)
|
(749)
|
Adjusted
for:
|
|
|
Net
purchases/(redemptions) of short-term investments
|
102
|
(1,120)
|
Strategic investments
and related
|
—
|
107
|
Net cash flows related
to certain airport construction projects and other
|
19
|
188
|
Financed aircraft
acquisitions
|
(137)
|
—
|
Pilot agreement
payment
|
735
|
—
|
Free cash
flow
|
$
1,853
|
$
197
|
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, 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)
|
March 31,
2023
|
December 31,
2022
|
March 31,
2022
|
|
1Q23 vs 4Q22
$ Change
|
Debt and finance lease
obligations
|
$
21,958
|
$
23,030
|
$
25,557
|
|
|
Plus: sale-leaseback
financing liabilities
|
1,924
|
2,180
|
2,221
|
|
|
Plus: unamortized
discount/(premium) and debt issue cost, net and other
|
120
|
138
|
193
|
|
|
Adjusted debt and
finance lease obligations
|
$
24,002
|
$
25,349
|
$
27,971
|
|
|
Plus: 7x last twelve
months' aircraft rent
|
3,627
|
3,558
|
3,138
|
|
|
Adjusted total
debt
|
$
27,630
|
$
28,906
|
$
31,109
|
|
|
Less: cash, cash
equivalents and short-term investments
|
(6,666)
|
(6,603)
|
(10,246)
|
|
|
Adjusted net
debt
|
$
20,964
|
$
22,303
|
$
20,863
|
|
$
(1,339)
|
Operating revenue,
adjusted related to premium products and diverse revenue
streams
|
|
|
Three Months
Ended
|
(in
millions)
|
March 31,
2023
|
Operating
revenue
|
$
12,759
|
Adjusted
for:
|
|
Third-party refinery
sales
|
(916)
|
Operating revenue,
adjusted
|
$
11,842
|
Less: main cabin
revenue
|
(5,223)
|
Operating revenue,
adjusted related to premium products and diverse revenue
streams
|
$
6,619
|
Percent of operating
revenue, adjusted related to premium products and diverse revenue
streams
|
56 %
|
Adjusted Non-Fuel
Cost and Non-Fuel Unit Cost or Cost per Available Seat Mile,
("CASM-Ex")
|
|
|
Three Months
Ended
|
(in
millions)
|
March 31,
2023
|
June 30,
2022
|
March 31,
2022
|
Operating
Expense
|
$
13,036
|
$
12,305
|
$
10,131
|
Adjusted
for:
|
|
|
|
Aircraft fuel and
related taxes
|
(2,676)
|
(3,223)
|
(2,092)
|
Third-party refinery
sales
|
(916)
|
(1,514)
|
(1,187)
|
Profit
sharing
|
(72)
|
(54)
|
—
|
One-time pilot
agreement expenses
|
(864)
|
—
|
—
|
Restructuring
charges
|
—
|
1
|
5
|
Non-Fuel
Cost
|
$
8,506
|
$
7,516
|
$
6,858
|
|
|
Three Months
Ended
|
|
1Q23 vs
1Q22
%
Change
|
|
March 31,
2023
|
June 30,
2022
|
March 31,
2022
|
|
CASM (cents)
|
21.25
|
20.89
|
19.56
|
|
|
Adjusted
for:
|
|
|
|
|
|
Aircraft fuel and
related taxes
|
(4.36)
|
(5.47)
|
(4.04)
|
|
|
Third-party refinery
sales
|
(1.49)
|
(2.57)
|
(2.29)
|
|
|
Profit
sharing
|
(0.12)
|
(0.09)
|
—
|
|
|
One-time pilot
agreement expenses
|
(1.41)
|
—
|
—
|
|
|
Restructuring
charges
|
—
|
—
|
0.01
|
|
|
CASM-Ex
|
13.86
|
12.76
|
13.24
|
|
4.7 %
|
Operating Expense,
adjusted
|
|
|
Three Months
Ended
|
(in
millions)
|
March 31,
2023
|
March 31,
2022
|
Operating
expense
|
$
13,036
|
$
10,131
|
Adjusted
for:
|
|
|
MTM adjustments and
settlements on hedges
|
41
|
4
|
Third-party refinery
sales
|
(916)
|
(1,187)
|
One-time pilot
agreement expenses
|
(864)
|
—
|
Restructuring
charges
|
—
|
5
|
Operating expense,
adjusted
|
$
11,296
|
$
8,954
|
Total fuel expense,
adjusted and Average fuel price per gallon, adjusted
|
|
|
|
|
|
|
|
Average Price Per
Gallon
|
|
Three Months
Ended
|
|
|
|
Three Months
Ended
|
|
March
31,
|
March
31,
|
|
1Q23 vs
1Q22
%
Change
|
|
March
31,
|
March
31,
|
(in millions, except
per gallon data)
|
2023
|
2022
|
|
|
2023
|
2022
|
Total fuel
expense
|
$
2,676
|
$
2,092
|
|
|
|
$
3.01
|
$
2.79
|
Adjusted
for:
|
|
|
|
|
|
|
|
MTM adjustments and
settlements on hedges
|
41
|
4
|
|
|
|
0.05
|
0.01
|
Total fuel expense,
adjusted
|
$
2,718
|
$
2,097
|
|
30 %
|
|
$
3.06
|
$
2.79
|
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)
|
March 31,
2023
|
March 31,
2022
|
Flight equipment,
including advance payments
|
$
630
|
$
1,276
|
Ground property and
equipment, including technology
|
370
|
490
|
Adjusted
for:
|
|
|
Financed aircraft
acquisitions
|
137
|
—
|
Net cash flows related
to certain airport construction projects
|
(48)
|
(201)
|
Gross capital
expenditures
|
$
1,090
|
$
1,565
|
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SOURCE Delta Air Lines