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DAL · Delta Air Lines

35 filings

10-K

DAL 10-K Annual Reports

Delta Air Lines - 35 annual reports

Filing record · 2016–202610-K1210-Q338-K210

2025
Delta Air Lines Annual Report, Year Ended Dec 31, 2025
Delta Air Lines, Inc. reported 2025 operating income of $5.8 billion ($5,822 million), down $173 million from 2024, on total operating revenue of $63.4 billion, up 3% ($1.7 billion), while total operating expense rose 3% to $57.5 billion. Net income was $5,005 million, or $7.66 per diluted share, compared with $3,457 million ($5.33) in 2024, helped by a $1,212 million gain on investments and total non-operating income of $363 million. The company generated $8.3 billion in operating cash flow and, after adjustments, $4.6 billion of free cash flow (a non-GAAP measure), while capital expenditures were $4.5 billion. Premium revenue and loyalty growth drove results, offset by weaker main cabin demand and higher employee costs; the company cited American Express remuneration of $8.2 billion, up about 11%. Balance sheet metrics improved: total debt and finance leases were $14.1 billion at year-end, with $4.8 billion of debt repayments in 2025, including $2.9 billion of early repayments, and $2.0 billion of new unsecured notes issued. Liquidity was $7.4 billion at December 31, 2025. Stockholders' equity rose to $20.9 billion from $15.3 billion, and the quarterly dividend was raised to $0.1875 per share. The company also disclosed aircraft purchase commitments of about $15.4 billion, plus new agreements with Boeing and Airbus signed in January 2026, and a pending Aeroméxico antitrust immunity dispute now stayed by the Eleventh Circuit. Risk items highlighted in the filing include fuel price exposure (fuel was 17% of operating expense), the DOT termination of antitrust immunity for the Aeroméxico joint cooperation agreement, the pending capacity antitrust litigation, labor agreements (about 20% of employees unionized, with the Delta pilots' agreement amendable December 31, 2026), and CORSIA and EU ETS regulatory costs.
Feb 11, 2026
2024
Delta Air Lines Annual Report, Year Ended Dec 31, 2024
Delta Air Lines, Inc. reported 2024 operating income of $6.0 billion ($5,995 million), up $474 million from 2023, and net income of $3,457 million, or $5.33 per diluted share, versus $4,609 million in 2023. Total operating revenue rose 6% to $61.6 billion on a 6% increase in capacity, with passenger revenue of $50.9 billion, premium product ticket revenue up 8% to $20.6 billion, and third-party refinery sales contributing to growth. Total operating expense rose 6% to $55.6 billion, and non-operating expense swung to $1.3 billion from $87 million of income in 2023, largely due to a $319 million loss on investments versus a $1.3 billion gain the prior year. The CrowdStrike-caused outage in July 2024 led to about 7,000 cancellations and an estimated $380 million direct revenue impact. Cash generation and balance sheet repair were central themes. Operating activities provided $8.0 billion, capital expenditures were $5.1 billion, and free cash flow, a non-GAAP measure, was $3.4 billion. Delta paid down about $4.0 billion of debt and finance leases, including roughly $1.1 billion of early repayments, and reported $6.1 billion of liquidity at year-end. Debt and finance leases principal totaled $16.2 billion, and Fitch and S&P upgraded the company to BBB-, giving it investment-grade ratings from all three major agencies. Stockholders' equity increased to $15.3 billion from $11.1 billion. Looking ahead, the filing states that Delta expects a 2025 effective tax rate of 23% to 25%, expects 2025 capital spending of approximately $5.0 billion, and has $18.3 billion of aircraft purchase commitments. Quarterly dividends rose to $0.15 per share in the September and December 2024 quarters, and the Board approved another $0.15 payment for March 2025. The company also flagged risks including fuel price volatility, labor negotiations, the Aeroméxico antitrust immunity renewal, and ongoing capacity antitrust litigation.
Feb 11, 2025
2023
Delta Air Lines Annual Report, Year Ended Dec 31, 2023
Delta Air Lines, Inc.'s 2023 Form 10-K reports operating income of $5.5 billion, an improvement of $1.9 billion from 2022, and operating income, adjusted (a non-GAAP measure excluding one-time pilot agreement expenses and other items) of $6.3 billion. Operating revenue rose $7.5 billion, or 15%, to $58.0 billion on a 17% increase in capacity, driven by demand for international travel and premium products. Net income was $4.609 billion, or $7.17 per diluted share, compared with $1.318 billion in 2022. Total operating expense rose 12% to $52.5 billion, including higher salaries and related costs, profit sharing of $1.4 billion, and an $864 million pilot agreement expense. Non-operating income was $87 million, reflecting mark-to-market gains on equity investments (including Wheels Up) and lower interest expense. The company generated $6.5 billion of operating cash flow and $2.0 billion of free cash flow (a non-GAAP measure), and repaid approximately $4.1 billion of debt and finance leases during 2023. Liquidity was $6.8 billion at year-end, and debt and finance lease principal stood at $20.1 billion. Management states its ongoing priority is restoring investment grade metrics, and the Board reinstated a quarterly dividend of $0.10 per share in 2023. The filing also notes that the Aeroméxico joint cooperation agreement's antitrust immunity renewal is pending, and that the company faces an ongoing capacity antitrust class action it believes is without merit. The company expects 2024 capacity growth in the single digits for domestic operations, a 23% to 25% effective tax rate, and capital spending of roughly $5 billion excluding the LaGuardia project. Aircraft purchase commitments totaled approximately $17.5 billion at year-end, and the company agreed in January 2024 to purchase 20 A350-1000 aircraft.
Feb 12, 2024
2022
Delta Air Lines Annual Report, Year Ended Dec 31, 2022
Delta Air Lines, Inc. reported a return to profitability for 2022 as demand for air travel recovered from the COVID-19 pandemic. Operating revenue rose 69% to $50.58 billion from $29.90 billion in 2021, on a 20% increase in system capacity. Operating income was $3.66 billion, compared with $1.89 billion in 2021 (which included a $4.5 billion payroll support program grant benefit), and net income was $1.32 billion, versus $280 million in 2021. Operating income was still $3.0 billion below 2019. Fuel expense rose sharply, with the average price per gallon increasing to $3.36 from $2.02, and fuel accounted for about 24% of total operating expense. Cash generation and balance sheet repair were central priorities. Operating activities provided $6.36 billion and free cash flow (a non-GAAP measure) was $244 million. Delta repaid approximately $4.5 billion of debt and finance lease obligations, including about $2.3 billion of early repayments, and ended the year with $9.4 billion of liquidity. Total debt and finance leases were $23.2 billion at year-end. Management stated it remains committed to regaining investment grade metrics and expects 2023 system capacity to fully recover to or exceed 2019 levels. Key risks include fuel price volatility, a pending pilot collective bargaining ratification (vote scheduled to close March 1, 2023, with an approximately $700 million one-time payment not yet accrued), airport and air traffic control constraints, and evolving environmental regulation including SAF mandates and CORSIA. The company also disclosed a pending class action antitrust matter concerning capacity, which it says lacks merit.
Feb 10, 2023
2021
Delta Air Lines Annual Report, Year Ended Dec 31, 2021
Delta Air Lines, Inc. reported 2021 operating revenue of $29.90 billion, up 75% from $17.10 billion in 2020 but down 36% from $47.01 billion in 2019, as demand recovered from COVID-19 with capacity up 45% year over year. Pre-tax income was $398 million, which includes $4.5 billion of government grant recognition under the Payroll Support Program Extension (PSP2) and PSP3. Excluding those grants and other items, pre-tax loss, adjusted (a non-GAAP measure) was $3.4 billion. Net income was $280 million, or $0.44 per diluted share, compared with a net loss of $12.39 billion in 2020. Operating income was $1.89 billion, versus an operating loss of $12.47 billion in 2020, and the 2020 results included $8.2 billion of restructuring charges. Liquidity was $14.2 billion at December 31, 2021, up $8.2 billion from 2019, supported by debt issuances and other initiatives. Operating cash flow was $3.26 billion and free cash flow (non-GAAP) was $1.26 billion. Debt and finance leases were reduced by about $5.8 billion in 2021, including roughly $3.8 billion of early repayments, and the principal amount of debt and finance leases stood at $27.1 billion at year-end. Management expects non-fuel unit costs to rise 7%-10% in 2022 versus 2019 and planned 2022 system capacity to be about 10% below 2019 for the full year. Management also said it expects international network capacity to return to 2019 levels only in 2023. The filing also highlights a pending $1.0 billion carbon neutrality commitment through 2030, a SAF goal of replacing 10% of jet fuel by 2030, and ongoing exposure to the Monroe Energy refinery, whose RIN compliance costs were $422 million in 2021. Pending legal matters include the capacity antitrust litigation, which the company says it believes is without merit.
Feb 11, 2022
2020
Delta Air Lines Annual Report, Year Ended Dec 31, 2020
Delta Air Lines, Inc. reported a 2020 pre-tax loss of $15.6 billion and a net loss of $12.4 billion, compared with pre-tax income of $6.2 billion and net income of $4.8 billion in 2019. Operating revenue fell $29.9 billion, or 64%, to $17.1 billion, as the COVID-19 pandemic cut demand, and system capacity was reduced approximately 50% versus 2019. Operating expense fell 27% to $29.6 billion, but restructuring charges of $8.2 billion, including $4.4 billion of fleet impairments and $3.4 billion of voluntary program charges, drove the operating loss to $12.5 billion. The company also recorded $3.9 billion of CARES Act payroll support grant recognition as a contra-expense and $2.4 billion of investment impairments and equity method losses. Liquidity was $16.7 billion at December 31, 2020, supported by approximately $25.9 billion of financing transactions and $5.6 billion of CARES Act payroll support. Free cash flow was negative $4.3 billion, compared with positive $4.2 billion in 2019. Total debt and finance leases principal reached $29.4 billion, and stockholders' equity fell to $1.5 billion from $15.4 billion. Management expects capacity and demand to recover through 2021, with a March 2021 quarter capacity forecast down 30% to 40% versus the March 2019 quarter, and expects positive operating cash flow for 2021 if demand evolves as planned. The company suspended dividends and share repurchases, and under the January 2021 payroll support extension it is restricted from these actions through March 2022. Management also cites a $2.9 billion expected payroll support extension payment and the continuing uncertainty of the pandemic's duration as key factors for investors to monitor.
Feb 12, 2021
2019
Delta Air Lines Annual Report, Year Ended Dec 31, 2019
Delta Air Lines, Inc. reported record 2019 financial results in this Form 10-K for the year ended December 31, 2019. Operating revenue rose to $47.007 billion from $44.438 billion, operating income increased to $6.618 billion from $5.264 billion, and net income reached $4.767 billion, or $7.30 diluted earnings per share, versus $5.67 in 2018. Management cites $8.4 billion of operating cash flow, $4.9 billion of capital expenditures and free cash flow of $4.2 billion, of which 72% (about $3 billion) was returned to shareholders through share repurchases and dividends. Liquidity was $6.0 billion at year-end, including $2.9 billion of cash and $3.1 billion of undrawn revolving credit facilities, and all three major rating agencies held Delta at investment grade. The filing highlights strategic moves across the network. Delta acquired a 20% stake in LATAM Airlines for $1.9 billion in January 2020 to form a planned strategic alliance, and it took a 10% stake in Hanjin-KAL, the largest shareholder of Korean Air. It also combined its Delta Private Jets unit with Wheels Up, receiving a 27% equity stake, and renewed its American Express co-brand agreement through 2029, with American Express cash sales of $4 billion in 2019 expected to grow to nearly $7 billion by 2023. Management noted that flights between the U.S. and China were suspended from February 2020 because of a novel coronavirus outbreak and that the company could not yet estimate the financial impact. Risks disclosed include fuel price volatility (fuel was 21.1% of operating expense in 2019), labor relations (the pilot contract became amendable on December 31, 2019, and about 19% of employees are unionized), the MD-90 fleet retirement by the end of 2022, and a pending antitrust class action over alleged capacity restraint, which Delta describes as without merit.
Feb 13, 2020
2018
Delta Air Lines Annual Report, Year Ended Dec 31, 2018
Delta Air Lines, Inc. reported 2018 operating revenue of $44.44 billion, up from $41.14 billion in 2017, and operating income of $5.26 billion versus $5.97 billion. Net income was $3.94 billion, or $5.67 per diluted share, compared with $3.21 billion ($4.43 per diluted share) in 2017. Operating expense rose to $39.17 billion, driven mainly by aircraft fuel and related taxes of $9.02 billion (up $2.26 billion) as the market price per gallon increased 31%, and by higher salaries and profit sharing. Total passenger revenue grew to $39.76 billion, with business cabin and premium product ticket revenue up 13.8% to $13.75 billion. Cash flow from operations was $7.01 billion in 2018, against $5.02 billion in 2017. Capital expenditures were $5.2 billion, used to take delivery of 68 new aircraft, and the company returned $2.5 billion to shareholders through $909 million of dividends and $1.58 billion of share repurchases. At December 31, 2018, Delta reported $4.8 billion of unrestricted liquidity, long-term debt and finance leases of $9.77 billion, and stockholders' equity of $13.69 billion. The company's investment-grade ratings were reaffirmed by Fitch, Moody's and S&P during 2018. The filing also highlights several items relevant to future results: adoption of the new revenue and lease standards, a $1.14 billion restricted cash balance for LaGuardia airport construction, a $16.16 billion aircraft purchase commitment, and pending regulatory approval of the WestJet joint venture and the combined three-party transatlantic joint venture. The company is a defendant in a capacity antitrust class action that it describes as without merit.
Feb 15, 2019
2017
Delta Air Lines Annual Report, Year Ended Dec 31, 2017
Delta Air Lines, Inc. reported 2017 operating revenue of $41.24 billion, up from $39.64 billion in 2016, and net income of $3.58 billion, down from $4.37 billion. Pre-tax income was $5.7 billion, a $935 million decrease from 2016, driven mainly by higher fuel costs, salaries and related costs, and depreciation. Operating cost per available seat mile rose 6.4% to 13.81 cents, while passenger revenue per available seat mile increased 2.1% on 1.0% higher capacity. Diluted earnings per share were $4.95, compared with $5.79 in 2016. The company generated $5.15 billion of operating cash flow in 2017, below $7.21 billion in 2016, partly reflecting $3.5 billion of pension contributions funded in part by a $2.0 billion debt issuance. Capital expenditures were $3.9 billion, and shareholders received $2.4 billion through dividends and share repurchases. Long-term debt and capital leases rose to $8.83 billion, and Standard & Poor's upgraded the company to investment grade, so all three major agencies now rate it investment grade. Total liquidity was $5.1 billion at year-end. Management highlighted revenue momentum, with three consecutive quarters of year-over-year passenger unit revenue growth to close 2017, and a planned change in revenue recognition under ASU 2014-09 effective January 1, 2018, which reclassifies about $2 billion of ancillary fees into passenger revenue. Key risks disclosed include fuel price volatility, labor relations, competition from government-backed Gulf carriers, and pending antitrust litigation over the first bag fee and capacity coordination.
Feb 23, 2018
2016-A
Delta Air Lines Annual Report (Amendment), Year Ended Dec 31, 2016
This Form 10-K/A (Amendment No. 1) for Delta Air Lines, Inc. covers the fiscal year ended December 31, 2016. It amends the company's Annual Report on Form 10-K, originally filed February 13, 2017. According to the explanatory note, the sole purpose of the amendment is to re-file Exhibit 23.1, the Consent of Independent Registered Public Accounting Firm, so that it accurately reflects the consent provided by Ernst & Young LLP. The cover page reports an aggregate market value of common equity held by non-affiliates of approximately $27.3 billion as of June 30, 2016, and 730,770,638 shares of common stock outstanding as of January 31, 2017. The common stock, par value $0.0001 per share, is registered on the New York Stock Exchange. The registrant is a large accelerated filer and a well-known seasoned issuer, and it is not a shell company. Part III information is incorporated by reference from the definitive proxy statement for the Annual Meeting of Stockholders. For investors, this filing is administrative in nature and does not change the company's prior reported results. Its significance lies in confirming the auditor consent associated with the original annual report.
Apr 12, 2017
2016
Delta Air Lines Annual Report, Year Ended Dec 31, 2016
Delta Air Lines, Inc. reported 2016 operating revenue of $39.64 billion, down from $40.70 billion in 2015, and net income of $4.37 billion, or $5.79 per diluted share, versus $4.53 billion in 2015. Pre-tax income was $6.6 billion, a $521 million decrease from the prior year, though pre-tax income adjusted for special items (a non-GAAP measure) rose 3.5% to $6.1 billion. Passenger revenue per available seat mile fell 4.9% on 2.1% higher capacity, reflecting competitive pressure in a low fuel price environment and U.S. dollar strength. Total fuel expense fell to $5.99 billion, with an average price of $1.49 per gallon versus $1.90 in 2015, while salaries and related costs rose to $10.03 billion, driven by an 18% pilot pay increase. Management highlighted balance sheet progress: debt and capital lease obligations were reduced to $7.3 billion, and the company received investment-grade ratings from Moody's and Fitch. Delta returned $3.1 billion to shareholders in 2016 through dividends and share repurchases, and the quarterly dividend was raised to $0.2025 per share. Cash flow from operations was $7.2 billion, against $3.4 billion of capital expenditures. The company also reported a 26.1% return on invested capital and plans to expand its Aeroméxico relationship through a joint venture and a tender offer for additional Grupo Aeroméxico shares expected in the first half of 2017. Key risks disclosed include fuel price volatility and hedging losses, labor cost pressure from new union contracts, competition from government-subsidized Gulf carriers, and pending antitrust litigation over first bag fees and capacity coordination. The company stated it believes these claims lack merit and is defending them vigorously.
Feb 13, 2017
2015
Delta Air Lines Annual Report, Year Ended Dec 31, 2015
Delta Air Lines, Inc. reported 2015 pre-tax income of $7.2 billion and net income of $4.53 billion, versus pre-tax income of $1.07 billion and net income of $659 million in 2014. Operating revenue rose to $40.70 billion from $40.36 billion, while operating expense fell to $32.90 billion from $38.16 billion, driven mainly by lower fuel prices. Aircraft fuel and related taxes fell 43.9% to $6.54 billion, and the average fuel price per gallon was $1.90 versus $3.47 in 2014. Pre-tax income adjusted for special items (a non-GAAP measure) rose to $5.9 billion. Fuel hedge mark-to-market adjustments and settlements contributed $1.3 billion of special items in 2015. The company reported return on invested capital (non-GAAP) of 28.3% in 2015, up from 20.7% in 2014, and reduced adjusted net debt to $6.7 billion. It returned $2.6 billion to shareholders through dividends and share repurchases in 2015, and generated $7.9 billion in operating cash flow against $2.9 billion of capital expenditures. Liquidity was $5.6 billion at year-end, including $2.2 billion of undrawn revolving credit facilities. Credit ratings were upgraded by all three major agencies during 2015, to BB+ (S&P), Ba2 (Moody's) and BB+ (Fitch). The filing also flags continuing exposures. Unit revenue (PRASM) fell 3.3% on 3.0% higher capacity, reflecting competitive pressure and a strong U.S. dollar. The Delta pilots' collective bargaining agreement became amendable on December 31, 2015, and negotiations were ongoing. The company faces two antitrust class actions, and it stated it expects to make annual operating cash flow of $7-8 billion and free cash flow of $4-5 billion part of its long-term plan.
Feb 5, 2016
2014
Delta Air Lines Annual Report, Year Ended Dec 31, 2014
Delta Air Lines, Inc. reported 2014 operating revenue of $40.36 billion, up from $37.77 billion in 2013, with operating income of $2.21 billion versus $3.40 billion a year earlier. Pre-tax income fell to $1.07 billion from $2.53 billion, driven by $3.5 billion of special items, including $2.35 billion of unfavorable mark-to-market adjustments on fuel hedges and $716 million of restructuring and other charges. Excluding special items, pre-tax income rose to $4.54 billion from $2.68 billion, according to the filing's non-GAAP reconciliation. Net income was $659 million, or $0.78 per diluted share, compared with $10.54 billion in 2013, which included an $8.0 billion tax benefit from releasing the valuation allowance. Fuel remained the largest expense at $13.51 billion, or 35% of operating expense, with an average price of $3.47 per gallon including hedge losses of $2.0 billion. The company's Monroe refinery in Trainer, Pennsylvania, recorded a profit of $96 million in 2014. Cash from operations was $4.95 billion, and the company reported $5.2 billion of unrestricted liquidity at year-end. Debt and capital leases were reduced to $9.9 billion principal, and the company returned $1.4 billion to shareholders through repurchases and dividends. The quarterly dividend was raised to $0.09 per share, and a $2.0 billion repurchase program was authorized. Looking ahead, the company ordered 50 widebody aircraft for delivery from 2017, expanded its Virgin Atlantic joint venture and Seattle hub, and continued fleet restructuring. Its 2015 capital investment is expected to be about $2.8 billion. Key risks disclosed include fuel price volatility, labor relations with 18% unionized employees, and competition from government-supported foreign carriers.
Feb 11, 2015
2013-A
Delta Air Lines Annual Report (Amendment), Year Ended Dec 31, 2013
This Amendment No. 1 to Delta Air Lines, Inc.'s Form 10-K for the fiscal year ended December 31, 2013 was filed on April 30, 2014 to add the Part III information required by Form 10-K, which the company had not included in its original annual report filed February 21, 2014. It covers directors and executive officers, executive compensation (Compensation Discussion and Analysis, Summary Compensation Table, director compensation), security ownership, related-party transactions, director independence, and principal accountant fees. The filing states that the company is simultaneously filing a preliminary proxy statement for its 2014 annual meeting that also includes this information. The compensation section reports the company's 2013 performance as stated by management: excluding special items, net income of $2.7 billion (an increase of more than 70% over 2012), free cash flow of $2.1 billion, and $350 million returned to stockholders through dividends and share repurchases. Adjusted net debt was reduced to $9.4 billion, and operating revenue rose $1.1 billion to $37.8 billion. The company reports GAAP net income of $8.5 billion for 2013 and debt and capital lease obligations of $11.3 billion at year-end. Management incentive plan payouts were 168.75% of target, and the profit sharing program paid a record $506 million. For investors, the most relevant items are the executive pay structure tied to financial, operational and stock price metrics, the stock ownership guidelines, the Northwest-related medical benefits obligation for the CEO, and the director and officer ownership levels disclosed as of April 15, 2014. The Vanguard Group is reported as a beneficial owner of 5.86% of outstanding common stock.
Apr 30, 2014
2013
Delta Air Lines Annual Report, Year Ended Dec 31, 2013
Delta Air Lines, Inc. reported a sharp swing to profitability for 2013, with net income of $10.54 billion, up from $1.01 billion in 2012. The result was driven mainly by an $8.0 billion net income tax benefit from releasing almost all of its valuation allowance against deferred tax assets. Income before income taxes was $2.53 billion, compared with $1.03 billion in 2012, and operating income rose to $3.40 billion from $2.18 billion on operating revenue of $37.77 billion (up 3%). The filing states that operating margin rose about 4 percentage points to 7%, and that operating expense fell $122 million as lower fuel expense (down $787 million, to $11.46 billion including regional carriers) offset higher salaries and profit sharing. Management noted that the company expects to record income tax expense at an effective rate of about 38% beginning in 2014, and that it holds more than $15 billion of net operating loss carryforwards that will offset cash taxes on future earnings. Balance sheet and capital allocation improved meaningfully. Stockholders' equity moved to $11.64 billion from a deficit of $2.13 billion a year earlier, and total debt and capital leases fell to $11.3 billion. The company ended 2013 with $5.7 billion in unrestricted liquidity and generated $4.5 billion in operating cash flow. Delta began a quarterly dividend of $0.06 per share, declared a $500 million share repurchase program running through June 2016, and returned about $350 million to shareholders during 2013. Capital expenditures were $2.6 billion, and the company expects about $2.3 billion in 2014, primarily for aircraft. Operationally, the filing highlights a fleet restructuring program (retiring 50-seat regional jets and adding B-737-900ER, B-717-200 and CRJ-900 aircraft), expansion at LaGuardia and JFK, a 49% equity stake in Virgin Atlantic for $360 million, and the Trainer refinery acquired in 2012 to supply jet fuel. Key risks disclosed include fuel price volatility (fuel was 33% of operating expense), refinery operating and RIN compliance costs (the refinery recorded a $116 million loss in 2013), pension funding obligations (funded status of about $10.1 billion unfunded), labor relations, and pending litigation, including the First Bag Fee antitrust case and the EU Regulation 261 class action.
Feb 24, 2014
2012
Delta Air Lines Annual Report, Year Ended Dec 31, 2012
Delta Air Lines, Inc. reported 2012 net income of $1.0 billion, or $1.19 per diluted share, on operating revenue of $36.67 billion, up from $35.12 billion in 2011. Operating income rose to $2.18 billion from $1.98 billion, while total operating expense grew 4% to $34.50 billion, driven mainly by higher fuel expense. Average fuel price per gallon rose 6% to $3.25, despite a 2% decline in consumption. Passenger mile yield improved 5% on flat traffic, and passenger revenue per available seat mile increased 7%. Management cites $5.2 billion in unrestricted liquidity at year-end, $2.5 billion of operating cash flow, and $1.1 billion of debt reduction during 2012. The filing highlights several strategic initiatives: a $1 billion structural cost program, a fleet restructuring to retire 50-seat regional jets and older aircraft, and the acquisition of the Trainer refinery near Philadelphia for $180 million to secure jet fuel supply. Delta also agreed to buy a 49% stake in Virgin Atlantic for $360 million and implemented a transpacific joint venture with Virgin Australia. Total debt and capital leases fell to $12.7 billion, while stockholders' deficit widened to $2.13 billion, largely due to a $1.8 billion other comprehensive loss tied to pension liabilities. The company has a $16.3 billion U.S. federal pretax net operating loss carryforward and a full valuation allowance of $11.0 billion against deferred tax assets, so it expects to pay no significant federal cash income taxes in the near term. Risk factors center on fuel price volatility, the pension funding obligation (about $675 million expected in 2013), the financial and collateral covenants on its secured debt, labor relations under the Railway Labor Act, and pending litigation including the First Bag Fee antitrust case and the EU Regulation 261 class action.
Feb 13, 2013
2011
Delta Air Lines Annual Report, Year Ended Dec 31, 2011
Delta Air Lines, Inc. reported net income of $854 million, or $1.01 per diluted share, for 2011, compared with $593 million in 2010. Total operating revenue rose to $35.1 billion from $31.8 billion, an increase of $3.4 billion or 11%, driven mainly by higher passenger revenue as fares rose in response to higher fuel prices. Total operating expense increased $3.6 billion, or 12%, to $33.1 billion, led by a $2.9 billion increase in fuel expense, which reached $11.8 billion including contract carriers and represented 36% of total operating expense. Hedging gains of $420 million reduced fuel expense; the average fuel price per gallon was $3.06, versus $2.33 in 2010. The balance sheet remains constrained. Stockholders' equity was a deficit of $1.4 billion at year-end 2011, compared with equity of $897 million a year earlier. Total debt and capital leases fell by $1.5 billion to $13.8 billion, and the company ended the year with $5.4 billion of unrestricted liquidity. Pension and postretirement liabilities on the balance sheet were $14.2 billion, and the defined benefit plans carried an unfunded obligation of about $11.5 billion, with a funding estimate of roughly $700 million for 2012. The company held a full valuation allowance of $10.7 billion against deferred tax assets and reported $16.8 billion of U.S. federal pretax net operating loss carryforwards. Management highlighted network and fleet initiatives, including a new LaGuardia hub built on a December 2011 slot exchange with US Airways, a commitment to purchase 100 Boeing 737-900ER aircraft with deliveries from 2013 through 2018, and a $1.2 billion JFK redevelopment project. The filing also disclosed pending litigation, including First Bag Fee antitrust claims, an EU Regulation 261 class action, and a Canadian passenger surcharge antitrust case.
Feb 10, 2012
2010-A
Delta Air Lines Annual Report (Amendment), Year Ended Dec 31, 2010
This Amendment No. 1 to Delta Air Lines, Inc.'s Annual Report on Form 10-K for the fiscal year ended December 31, 2010, filed March 4, 2011, has a single stated purpose: to furnish Exhibit 101, the XBRL-formatted version of the financial materials from the Form 10-K originally filed with the SEC on February 16, 2011. The filing states that no other changes have been made to the Form 10-K and that it speaks as of the original filing date. The filing itself contains no financial statements, operating results, or narrative business discussion. Its substantive content is the exhibit index, which lists the company's governing documents, material debt agreements (a First Lien Revolving Credit and Guaranty Agreement and a Second Lien Term Loan and Guaranty Agreement, both dated April 30, 2007), a Transaction Framework Agreement with the Air Line Pilots Association, International, an Anchor Tenant Agreement with JFK International Air Terminal LLC dated December 9, 2010, and numerous executive compensation plans and agreements, including the 2011 Long Term Incentive Program and 2011 Management Incentive Plan. Several Northwest Airlines compensation and stock incentive plans are also referenced, as are the company's XBRL instance, schema, and linkbase documents. For investors, the key takeaway is that this amendment is administrative. Financial and business details should be sought in the original February 16, 2011 Form 10-K, and governance and compensation details in the company's definitive proxy statement, which Part III incorporates by reference.
Mar 4, 2011
2010
Delta Air Lines Annual Report, Year Ended Dec 31, 2010
Delta Air Lines, Inc. reported its 2010 annual results in this Form 10-K filed February 16, 2011. Operating revenue rose to $31.76 billion in 2010 from $28.06 billion in 2009, and operating income was $2.22 billion, compared with an operating loss of $324 million in 2009. Net income was $593 million, or $0.70 diluted earnings per share, versus a net loss of $1.2 billion in 2009. The company cited special items totaling $851 million in 2010, including $450 million of restructuring and merger-related items and $401 million primarily from a loss on extinguishment of debt. Excluding special items, operating margin was 8.4% in 2010 versus 0.3% in 2009. The company attributed the improvement mainly to a strengthening airline revenue environment, with mainline passenger revenue up $2.89 billion and fares higher. Fuel remained the largest sensitivity. Aircraft fuel and related taxes were $7.59 billion, and the average price per gallon rose to $2.33 from $2.15, a figure net of $89 million in hedge costs. Total debt and capital leases fell to $15.3 billion from roughly $17.2 billion, and unrestricted liquidity was $5.2 billion at year-end. The company reported a U.S. federal pre-tax net operating loss carryforward of $17.1 billion and stated it does not expect to pay cash federal income taxes for several years. Delta does not pay dividends and expects to retain earnings, with credit facility restrictions limiting dividends and buybacks. Key risks disclosed include labor (about 17% of employees unionized, with several contracts amendable in 2011 and 2012), pending antitrust litigation over first-bag fees, a pending DOT decision on the proposed Virgin Blue joint venture expected in 2011, and an unfunded pension obligation of roughly $9.3 billion. The filing also describes a $1.2 billion JFK Terminal 4 redevelopment project and the continuing integration of Northwest Airlines, which merged into Delta in 2008.
Feb 16, 2011
2009
Delta Air Lines Annual Report, Year Ended Dec 31, 2009
Delta Air Lines, Inc. reported a 2009 net loss of $1.2 billion ($1,237 million, or $1.50 per diluted share) on operating revenue of $28.06 billion, compared with an operating expense of $28.39 billion. Management attributes the weak results to a sharp decline in airline revenue during the global recession, with passenger revenue down 20% on a combined basis versus 2008, and to $1.4 billion in fuel hedge losses. The results also include a $407 million charge for merger-related items with Northwest Airlines, an $321 million non-cash income tax benefit and an $83 million non-cash loss on debt extinguishment. Fuel expense declined 40% on a combined basis, which partly offset the revenue decline. The 2009 results include Northwest for the full year, while 2008 included Northwest only from October 30, so the filing presents a combined 2008 comparison. On that basis, operating revenue fell 18% and capacity fell 6%. The company ended 2009 with $4.7 billion in cash and short-term investments, $685 million in undrawn revolving credit facilities and $5.4 billion in unrestricted liquidity. It completed $3.2 billion of financing transactions during the year, and it expects approximately $2 billion in annual revenue and cost synergies from the Northwest merger by 2012. Total debt at par was $18.07 billion and the pension funding requirement for 2010 is estimated at about $720 million. The filing also flags material risks, including fuel price volatility, labor representation issues tied to the merger, integration of Northwest operations, and pending antitrust litigation over the first-checked-bag fee. The company does not expect to pay dividends in the foreseeable future.
Feb 24, 2010
2008
Delta Air Lines Annual Report, Year Ended Dec 31, 2008
Delta Air Lines, Inc. reported a 2008 net loss of $8.9 billion (diluted loss per share of $19.08), driven primarily by a $7.3 billion non-cash impairment of goodwill and other intangible assets and $1.1 billion in primarily non-cash merger-related charges. Operating revenue rose to $22.7 billion in 2008 from $13.4 billion for the eight months ended December 31, 2007 (Successor), and operating expense reached $31.0 billion, producing an operating loss of $8.3 billion. Fuel was the dominant cost pressure: the average price per gallon rose to $3.16 from $2.24 in 2007, and aircraft fuel accounted for 38% of total operating expense (28% including the impairment and merger charges). The results include Northwest Airlines only from the October 29, 2008 merger closing, which contributed about $2.0 billion of operating revenue in the period from October 30 to December 31, 2008. Liquidity and balance sheet strain are central to the filing. Cash and short-term investments were $4.5 billion at year-end, supported by $2.4 billion acquired from Northwest, a $1.0 billion American Express SkyMiles advance purchase, and full $1.0 billion draw on the revolving facility, offset by $1.2 billion of fuel hedge margin posted to counterparties. Total assets were $45.0 billion, long-term debt and capital leases $16.6 billion, and stockholders' equity fell to $874 million from $10.1 billion. Management expects a significant loss in the March 2009 quarter, plans capacity reductions of 6-8% for 2009, and targets roughly $2 billion in annual revenue and cost synergies from the merger by 2012, with about $500 million in one-time integration cash costs over approximately three years. Management expects weaker 2009 demand from the global recession, and the company faces risks from its substantial indebtedness, covenant restrictions in its credit facilities, a $1.2 billion fuel hedge margin requirement, expected higher pension funding for 2010 and beyond, and labor integration issues, since about 80% of pre-merger Northwest employees are unionized. The company does not anticipate paying dividends.
Mar 2, 2009
2007
Delta Air Lines Annual Report, Year Ended Dec 31, 2007
Delta Air Lines, Inc. filed its 2007 Form 10-K on February 15, 2008, the first annual report after emerging from Chapter 11 bankruptcy on April 30, 2007. Because of fresh start reporting, the company presents a Successor period (eight months ended December 31, 2007) and a Predecessor period (four months ended April 30, 2007), and management discusses them on a combined basis. Combined 2007 results show net income of $1.6 billion, including a $1.2 billion net gain from reorganization items, and operating income of $1.1 billion on operating revenue of $19.2 billion, up 9% from 2006. Passenger revenue rose 9% on a 3% rise in capacity, and fuel averaged $2.21 per gallon with 38% of consumption hedged. The balance sheet at December 31, 2007 shows total assets of $32.4 billion, including $12.1 billion of goodwill, and shareowners' equity of $10.1 billion, compared with a deficit of $13.6 billion a year earlier. Cash and cash equivalents were $2.6 billion, long-term debt and capital leases were $8.0 billion, and the company held $9.1 billion of federal and state net operating loss carryforwards. Operating cash flow was $1.4 billion for the combined year, after $875 million of bankruptcy-related payments to ALPA and the PBGC, and capital expenditures exceeded $1.0 billion. Risks the filing emphasizes include high and volatile fuel costs, substantial indebtedness and exit financing covenants, labor issues (about 17% of employees are unionized), and NOL usage limits tied to future ownership changes. The company also notes that the Air France joint venture begins in April 2008 and that its board has a special committee reviewing strategic options, including potential consolidation transactions.
Feb 15, 2008
2006-A
Delta Air Lines Annual Report (Amendment), Year Ended Dec 31, 2006
Delta Air Lines, Inc. filed this Amendment No. 1 to its Form 10-K for the fiscal year ended December 31, 2006, to add the Part III information (directors, executive officers, executive compensation, security ownership, related transactions, and auditor fees) that was omitted from its original March 2, 2007 annual report. The amendment states that the company is still operating under Chapter 11 protection. Under its plan of reorganization, holders of allowed unsecured claims would generally receive common stock of reorganized Delta, and current holders of equity interests would receive no distributions and have their shares cancelled when the plan takes effect. The filing describes a planned emergence from Chapter 11 in early May 2007, and states that the company's securities became eligible to be listed on the NYSE again effective April 26, 2007. The filing reports that the company sought $3.0 billion in annual financial improvements by the end of 2007 and states that it reached that goal as of December 31, 2006. Officers did not receive annual or long-term incentive payments in 2006, and no stock or option awards were granted to officers that year. Stock options were rejected in bankruptcy effective March 31, 2006. The company has also developed a post-emergence compensation program for approximately 39,000 noncontract employees, including a significant distribution of common stock, a cash lump-sum payment, pay increases expected to begin in summer 2007, and a new defined contribution retirement benefit. The pilot plan was terminated and the PBGC assumed trusteeship on December 31, 2006, and ALPA received a $2.1 billion general unsecured pre-petition claim and $650 million in senior unsecured notes in exchange for concessions. As of February 28, 2007, there were 197,335,938 shares of common stock outstanding, and the aggregate market value held by non-affiliates as of June 30, 2006 was approximately $148 million. The filing states that no annual shareowner meeting was held in 2006 due to the bankruptcy proceedings, and that the board met 10 times during 2006. Ernst & Young LLP reported 2006 audit fees of $2,787,000 and tax fees of $778,000, and Deloitte & Touche LLP reported 2005 audit fees of $4,285,500.
Apr 27, 2007
2006
Delta Air Lines Annual Report, Year Ended Dec 31, 2006
Delta Air Lines, Inc. (Debtor-in-Possession) reported a 2006 net loss of $6.2 billion, driven primarily by a $6.2 billion charge for reorganization items, net, while operating income improved to $58 million from an operating loss of $2.0 billion in 2005. Operating revenue rose 6% to $17.2 billion and operating expense fell 6% to $17.1 billion, with lower salaries, restructuring charges and aircraft rent offsetting higher fuel costs and contract carrier expense. The company stated it reached its $3.0 billion annual financial improvement goal by year-end 2006. Cash and short-term investments were $2.6 billion at December 31, 2006, and shareowners' deficit widened to $13.6 billion. The company remains in Chapter 11, which it entered on September 14, 2005. Its Plan of Reorganization, filed December 19, 2006, contemplates emergence as an independent airline, with creditors receiving common stock of reorganized Delta and current equity holders receiving no distribution and having their shares cancelled. The Bankruptcy Court set an April 9, 2007 deadline for creditor votes and an April 25, 2007 confirmation hearing. The company also rejected an unsolicited US Airways merger proposal, which US Airways withdrew after the creditors committee endorsed the standalone plan. The filing explicitly urges caution regarding existing and future investments in its equity securities. The filing also reports a $2.5 billion exit financing facility commitment, $87.0 billion in filed claims against the Debtors, and a going-concern qualification from the auditors. Comair Flight 5191 crashed on August 27, 2006, with 49 fatalities, and lawsuits are pending against Comair and, in some cases, Delta.
Mar 2, 2007
2005-A
Delta Air Lines Annual Report (Amendment), Year Ended Dec 31, 2005
This Form 10-K Part III amendment-style filing from Delta Air Lines, Inc. (filed April 28, 2006) supplies the governance, executive compensation, beneficial ownership, and auditor fee disclosures that Items 10 through 14 call for. It does not contain financial statements. The filing is set against Delta's Chapter 11 reorganization, which began September 14, 2005. Gerald Grinstein serves as Chief Executive Officer and John F. Smith, Jr. as non-executive Chairman. Executive salaries were cut 15% for most officers and 25% for Mr. Grinstein effective November 1, 2005, and the company seeks an additional $3 billion in annual financial benefits by the end of 2007. The filing states that all stock options, stock appreciation rights, and other equity awards were rejected effective March 31, 2006, with Bankruptcy Court approval, so existing equity compensation has no value. The Bankruptcy Court also approved a new Director and Officer Severance Plan on February 22, 2006, with severance of 12 months' base salary for Executive Vice Presidents, nine months for Vice Presidents and Senior Vice Presidents, and six months for Directors. Pre-petition non-qualified nonpilot retirement benefits have ceased, and nonpilots would hold unsecured claims in the bankruptcy. Directors and executive officers as a group beneficially owned 122,613 shares, less than 1% of common stock. Auditor fees were $4,188,500 in audit fees for 2005, down from $4,748,203 in 2004, and tax fees fell from $2,825,420 to $296,208. For investors, the key takeaways are the cost-cutting pay structure, the wiping out of equity incentives, and the shift of retirement liabilities into the bankruptcy process. Mr. Matsen's employment ends June 1, 2006, and his position will not be replaced.
Apr 28, 2006
2005
Delta Air Lines Annual Report, Year Ended Dec 31, 2005
Delta Air Lines, Inc. filed its 2005 Form 10-K on March 27, 2006, after filing for Chapter 11 reorganization on September 14, 2005 in the U.S. Bankruptcy Court for the Southern District of New York. The company reported a 2005 consolidated net loss of $3.8 billion (net loss attributable to common shareowners of $3.836 billion, or $23.75 per share), compared with $5.2 billion in 2004. Operating revenues rose 6% to $16.2 billion on a 6% rise in revenue passenger miles, but operating expenses were $18.2 billion, including an $888 million restructuring, pension settlement and related charge and $1.3 billion higher aircraft fuel expense (average price per gallon up 47% to $1.71). The auditor's report includes a going-concern paragraph, and the company states that its common stock will have no value and will be canceled under any plan it proposes. Liquidity is a central concern. Cash and short-term investments were $2.0 billion at year-end, with restricted cash of $928 million, and the company's post-petition financing includes financial covenants such as a minimum unrestricted-funds requirement and EBITDAR targets. Management is pursuing a business plan targeting $3 billion in additional annual benefits by the end of 2007, on top of a $5 billion transformation plan due by the end of 2006. Key open items include a pilot labor dispute, in which a neutral panel was to issue a decision on whether Delta may reject its pilot collective bargaining agreement by April 15, 2006, and a pending $3.4 billion of pension funding requirements for 2006 through 2008 that the company believes it need not fund while in Chapter 11. For investors, the filing is a restructuring-stage document. Total assets were $20.0 billion and shareowners' deficit was $9.9 billion at year-end. Recovery to pre-petition creditors and shareowners is described as highly speculative, and the filing explicitly urges caution in investing in existing common stock or other securities.
Mar 27, 2006
2004-A
Delta Air Lines Annual Report (Amendment), Year Ended Dec 31, 2004
Delta Air Lines, Inc. filed this Amendment No. 1 on Form 10-K/A to its Annual Report for the fiscal year ended December 31, 2004, which was originally filed on March 10, 2005. The sole stated purpose is to re-file Exhibit 23.1, the Consent of Independent Registered Public Accounting Firm, because the original filing omitted the conformed signature of Deloitte & Touche LLP on that exhibit. The amendment is signed by Leslie P. Klemperer, Secretary, on March 11, 2005. The cover page provides basic registration details. Delta's common stock, par value $1.50 per share, is listed on the New York Stock Exchange, along with preferred stock purchase rights and 8 1/8% Notes due July 1, 2039. The registrant is an accelerated filer. The aggregate market value of common equity held by non-affiliates was approximately $894 million as of June 30, 2004. As of February 28, 2005, there were 141,229,031 shares of common stock outstanding. Part III information is incorporated by reference from the definitive proxy statement for the Annual Meeting of Shareowners scheduled for May 19, 2005. This filing contains no financial statements, operating results, or narrative business discussion. Investors seeking the company's financial performance for 2004 should refer to the original Form 10-K filed March 10, 2005.
Mar 11, 2005
2004
Delta Air Lines Annual Report, Year Ended Dec 31, 2004
Delta Air Lines, Inc. reported a 2004 net loss of $5.2 billion ($41.07 per diluted share), its fourth consecutive year of substantial losses, compared with a net loss of $773 million in 2003. Operating revenues rose 6% to $15.0 billion, but operating expenses increased 23% to $18.3 billion, driven by a $1.9 billion goodwill impairment charge, sharply higher fuel prices (average price per gallon up 42% to $1.16), and the absence of 2003 Appropriations Act reimbursements. Passenger mile yield fell 4%, which management attributes to low-cost carrier growth, high industry capacity and customer price sensitivity. Unrestricted cash and short-term investments declined to $1.8 billion from $2.7 billion. The filing states that Deloitte & Touche's audit report contains a going concern explanatory paragraph. Management says Delta must achieve approximately $5 billion in annual benefits from its transformation plan by the end of 2006 (about $2.3 billion was achieved by end-2004), and that it expects a substantial net loss in 2005 and cash flows insufficient to meet all 2005 liquidity needs. If the plan's assumptions fail and asset sales or capital markets access are unavailable, the company states it would need to seek restructuring under Chapter 11 of the U.S. Bankruptcy Code. Total debt and capital leases were $13.9 billion, and shareowners' deficit stood at $5.8 billion at year-end. Key near-term items include a 2005 jet fuel price assumption of approximately $1.22 per gallon, a pilot agreement that yields about $1 billion in annual savings, the February 2005 Amex prepayment, and covenants under the GE Commercial Finance and Amex facilities that the company does not expect to exceed by a significant margin.
Mar 10, 2005
2003
Delta Air Lines Annual Report, Year Ended Dec 31, 2003
Delta Air Lines, Inc. reported a 2003 net loss of $773 million, or $6.40 per diluted share, compared with a net loss of $1.3 billion ($10.44 per share) in 2002. Operating revenues were $13.3 billion, essentially flat with 2002, while operating expenses fell to $14.1 billion and the operating loss narrowed to $786 million from $1.3 billion. The company describes a severely depressed revenue environment since September 11, 2001, with its unit costs (CASM of 10.48 cents) now among the highest of the hub-and-spoke carriers, which it identifies as a serious competitive disadvantage against low-cost carriers and restructured rivals. Management expects a net loss of approximately $400 million in the March 2004 quarter and does not anticipate significant revenue improvement in 2004. Liquidity and balance sheet strain are central concerns. Debt and capital lease obligations totaled $12.6 billion at year-end, shareowners' equity was a deficit of $(659) million, and the company had negative working capital of $1.7 billion. Cash and cash equivalents rose to $2.7 billion, supported by $2.2 billion of 2003 borrowings and a February 2004 $325 million convertible note issuance, but the company has no undrawn lines of credit. Credit ratings were cut to B3 (Moody's), B (S&P) and B (Fitch), and the company faces about $1.0 billion of 2004 debt maturities and estimated 2004 pension funding of about $440 million. The company also discontinued its common dividend in July 2003 and is reassessing its operating and business strategy, with completion expected by July 2004. Key 2004 cost pressures identified include higher aircraft fuel, pension and interest expenses, with estimated annual increases of approximately $180 million, $130 million and $75 million, respectively. The filing also notes that the pilot labor agreement is amendable May 1, 2005, and that management is in discussions with the Air Line Pilots Association aimed at reducing pilot labor costs, though the outcome cannot be predicted.
Mar 12, 2004
2002
Delta Air Lines Annual Report, Year Ended Dec 31, 2002
Delta Air Lines, Inc. reported a 2002 consolidated net loss of $1.3 billion ($10.44 diluted loss per share), compared with a net loss of $1.2 billion ($9.99 per share) in 2001. Operating revenues fell 4% to $13.3 billion, while operating expenses decreased 6% to $14.6 billion, leaving an operating loss of $1.3 billion. Management said it does not expect significant revenue improvement in 2003 and expects a net loss for 2003, with the March 2003 quarter loss expected to exceed the March 2002 quarter loss. Shareowners' equity fell to $893 million from $3.8 billion, largely due to a $1.6 billion non-cash pension-related charge to equity, and the net debt-to-capital ratio rose to 94% from 80%. Liquidity and credit conditions are a central concern. Delta borrowed $2.6 billion in 2002, held $1.9 billion of cash at February 28, 2003, and carried negative working capital of $2.6 billion. Its senior unsecured long-term debt was rated Ba3 by Moody's and BB- by Standard & Poor's, with negative outlooks. The filing notes approximately $700 million of current debt maturities in 2003, a $500 million secured credit facility expiring August 2003, and a $250 million receivables securitization expiring March 31, 2003, which Delta is seeking to renew or refinance. Management cautioned there is no assurance such financing will be available. Cost and strategic initiatives include a target of reducing non-fuel unit costs by 15% by the end of 2005, up to 8,000 additional job reductions, deferral of 31 aircraft deliveries with no scheduled mainline deliveries in 2003 or 2004, and the planned April 2003 launch of the low-fare carrier Song. The marketing alliance with Continental and Northwest awaits DOT review and international partner consents, with implementation expected during 2003.
Mar 27, 2003
1998
Delta Air Lines Annual Report, Year Ended Jun 30, 1998
Delta Air Lines, Inc. reported its strongest fiscal-year performance ever for the year ended June 30, 1998, with operating income of $1.7 billion ($1,693 million) and net income of $1.0 billion ($1,001 million, or $13.28 basic and $12.68 diluted income per common share). Operating revenues rose 4% to $14.1 billion, driven by a 3% increase in revenue passenger miles on 2% capacity growth, while operating expenses rose 3% to $12.4 billion. Aircraft fuel expense fell 12% as the average price per gallon declined 15% to 56.54 cents. Other expense narrowed to $45 million, mainly from lower interest expense. Financial position strengthened over the year. Cash and short-term investments totaled $1.6 billion at June 30, 1998, versus $1.2 billion a year earlier. Operating cash flow was $2.9 billion, and the company repurchased $354 million of common stock. Long-term debt including current maturities fell to $1.9 billion from $2.1 billion, and shareowners' equity rose to $4.0 billion from $3.0 billion. The company had negative working capital of $1.2 billion, which it describes as normal. Capital spending was substantial, with $1.8 billion invested in flight equipment and $531 million in ground property, and firm aircraft orders totaled $6.9 billion as of August 14, 1998. The filing also flags risks. Management highlights ongoing low-fare competition, a proposed DOT enforcement policy on hub-airport capacity responses, pending pilot pay-rate negotiations for new aircraft types, and Year 2000 remediation with estimated costs of $160 million to $175 million. Delta announced a two-for-one common stock split subject to shareowner approval and a $750 million repurchase authorization. Its alliance with United Air Lines is proceeding on reciprocal frequent flyer benefits, but code-sharing was discontinued after the pilot union withdrew its approval.
Sep 28, 1998
1997
Delta Air Lines Annual Report, Year Ended Jun 30, 1997
Delta Air Lines, Inc. reported fiscal 1997 (year ended June 30, 1997) net income of $854 million, or $11.30 primary and $11.01 fully diluted income per common share, compared with $156 million ($1.42 per share) in fiscal 1996. Operating revenues rose 9% to $13.59 billion and operating income increased to $1.53 billion from $463 million. Fiscal 1997 results include $52 million of pretax restructuring and other non-recurring charges tied to the realignment of transatlantic and European operations, while fiscal 1996 included $829 million of such charges, largely a $452 million writedown of the L-1011 fleet. Excluding these items, net income was $886 million, and operating income was $1.6 billion. Passenger revenue grew 8% on a 10% increase in revenue passenger miles, while the system passenger mile yield declined 2% amid low-fare competition. Cash from operations was $2.04 billion, and capital spending totaled $1.6 billion on flight equipment and $350 million on ground property. Shareholders' equity rose to $3.0 billion, and long-term debt and capital lease obligations including current maturities were $2.1 billion, or 41% debt and 59% equity. Delta reached a March 1997 understanding with The Boeing Company covering 106 firm aircraft orders and additional options, with estimated future aircraft and related commitments of $5.9 billion. Management also changed in August 1997, when Leo F. Mullin became President and Chief Executive Officer following Ronald W. Allen's retirement. The filing notes several risks, including fuel price exposure (a one-cent change in jet fuel price affects annual fuel expense by about $26 million), a pending Transport Workers Union organizing application covering about 8,000 Fleet Service employees, and an ongoing ValuJet antitrust lawsuit.
Sep 29, 1997
1996
Delta Air Lines Annual Report, Year Ended Jun 30, 1996
Delta Air Lines, Inc. reported fiscal 1996 (year ended June 30, 1996) net income of $156 million, or $1.42 per primary and fully diluted common share after preferred stock dividends, on operating income of $463 million. Results include pretax restructuring and other non-recurring charges of $829 million ($506 million after tax, or $9.71 per common share), primarily a $452 million write-down of the Lockheed L-1011 fleet and $273 million for a special early retirement program for approximately 500 pilots. Excluding these charges, net income was $662 million ($11.13 primary per share), and operating income was $1.3 billion, compared with $294 million net income excluding the SFAS 112 cumulative effect in fiscal 1995. Operating revenues rose 2% to $12.5 billion, driven by a 3% increase in passenger revenue, while operating expenses rose 4% to $12.0 billion, though expenses excluding charges fell 3% under the Leadership 7.5 cost reduction program. The company's balance sheet strengthened, with stockholders' equity rising to $2.54 billion from $1.83 billion and long-term debt and capital leases (including current maturities) falling to $2.3 billion from $3.3 billion. Cash and short-term investments totaled $1.6 billion at June 30, 1996, and cash from operations was $1.4 billion. Management stated that Delta has shifted strategy from a strict focus on operating costs to a balanced approach that also emphasizes revenue improvement, and it raised its three-year operating margin goal to 12% by the end of fiscal 1999. The company also announced Delta Express, a low-fare unit scheduled to launch October 1, 1996, and a global marketing alliance with Swissair, Sabena and Austrian Airlines that received antitrust immunity from the DOT on June 14, 1996. Key risks disclosed include continued low-fare competition, a 4.3 cent per gallon federal jet fuel tax that the company estimates costs about $90 million annually, and several pending lawsuits, including a travel agent commission antitrust class action seeking about $725 million (trebled) for which Delta agreed to pay $20 million in settlement, and a ValuJet suit alleging antitrust violations related to LaGuardia slots.
Sep 30, 1996
1995
Delta Air Lines Annual Report, Year Ended Jun 30, 1995
Delta Air Lines, Inc. reported net income of $408 million for the fiscal year ended June 30, 1995, compared with a net loss of $409 million in fiscal 1994. Excluding a one-time $114 million after-tax benefit from the adoption of SFAS 112 and the prior year's restructuring charges, net income was $294 million, versus a net loss of $77 million in fiscal 1994. Operating revenues rose 1% to $12.2 billion, while operating expenses fell 8% to $11.5 billion, producing operating income of $661 million compared with an operating loss of $447 million a year earlier. The improvement was attributed primarily to cost reductions under the Leadership 7.5 program, which targets roughly $2 billion in annual operating expense reductions by the end of the June 1997 quarter. Passenger mile yield declined 1% as low-cost, low-fare carriers expanded in Delta's domestic markets. The balance sheet strengthened modestly, with stockholders' equity rising to $1.83 billion from $1.47 billion and long-term debt and capital leases (excluding current maturities) falling to $3.12 billion from $3.23 billion. Cash, cash equivalents and short-term investments totaled $1.8 billion at June 30, 1995. Management noted negative working capital of $427 million, which it described as normal for the company. Cash from operations was $1.1 billion. Capital spending on flight equipment was $458 million, down from $1.03 billion in fiscal 1994, and the company voluntarily repurchased $403 million of long-term debt. Risks highlighted in the filing include ongoing negotiations with the Air Line Pilots Association, which Delta seeks to win $340 million in annual productivity improvements and wage and benefit reductions from, a proposed 4.3 cent per gallon federal jet fuel tax effective October 1, 1995 estimated to add about $80 million annually, several pending lawsuits (including Pan Am-related litigation and travel agent commission cap antitrust suits), and the expectation of continued low-fare competition. Delta's deferred tax assets of $740 million net are expected to be realized, based on management's assessment of future taxable income.
Sep 28, 1995
1994
Delta Air Lines Annual Report, Year Ended Jun 30, 1994
Delta Air Lines, Inc. reported a fiscal 1994 (year ended June 30, 1994) net loss of $409 million, or $10.32 per common share after preferred dividends, on operating revenues of $12.36 billion and an operating loss of $447 million. Excluding restructuring charges of $526 million and the cumulative effect of accounting changes, the company reported an operating income of $79 million and a net loss of $77 million ($3.73 per share). Results were hurt by discount fares, the growing presence of low-cost, low-fare carriers (about 57% of domestic revenue passenger miles were in markets they also served), and weak European economies. Passenger mile yield fell 1% and operating expense per available seat mile rose 2% to 9.72 cents. Management launched "Leadership 7.5," a three-year plan targeting roughly $2 billion in annual operating cost reductions by the June 1997 quarter, with planned workforce reductions of 12,000 to 15,000 jobs and unit cost goals of 8.6, 8.0 and 7.5 cents. The plan is contingent on significant concessions, with the company seeking $320 to $340 million in annual productivity and wage savings from the pilots' union (ALPA) in negotiations expected to begin in November 1994. Delta also deferred delivery of 37 aircraft, cutting planned capital spending by about $1 billion through fiscal 1996, and announced plans to phase out its Airbus A310 fleet. Balance sheet items include cash and short-term investments of $1.7 billion, long-term debt and capital leases of $3.5 billion, stockholders' equity of $1.5 billion, and negative working capital of $313 million, which the filing describes as normal for Delta. The filing also details substantial pending litigation tied to Delta's participation in Pan Am's reorganization, including a claim for at least $2.5 billion in damages, which management believes is not likely to have a material adverse effect.
Sep 27, 1994