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Delta Air Lines Annual Report, Year Ended Dec 31, 2021

Filing Date
Filed February 11, 2022
Period End
December 31, 2021
Security
DAL
In the record · 2016–202610-K1210-Q338-K210

DAL filed 12 annual reports (10-K), 33 quarterly reports (10-Q) and 210 current reports (8-K) between 2016 and 2026.

  1. Leadership change8-K · Feb ’16Feb ’16
  2. Leadership change8-K · Apr ’18Apr ’18
  3. Material agreement8-K · Apr ’21Apr ’21
  4. Material agreement8-K · Jun ’26Jun ’26

01—Abstract

Summary

Summary of the 10-K filed February 11, 2022. Cited figures are marked; the original filing is the authoritative source.

Delta Air Lines, Inc. reported 2021 operating revenue of $29.90 billiona, 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 millionb, 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 billionc, 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 billiond 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.

02—Key points

Key Highlights

  1. Operating revenue of $29.90 billion in 2021, up 75% from 2020 but down 36% from 2019, with TRASM of 15.37 cents.
  2. Pre-tax income of $398 million, including $4.5 billion of PSP2/PSP3 government grant recognition; pre-tax loss, adjusted, was $3.4 billion.
  3. Net income of $280 million, or $0.44 per diluted share, versus a net loss of $12.39 billion in 2020.
  4. Liquidity of $14.2 billion at December 31, 2021, an $8.2 billion increase versus 2019.
  5. Operating cash flow of $3.26 billion and free cash flow of $1.26 billion in 2021; debt and finance lease repayments of about $5.8 billion.
  6. Principal amount of debt and finance leases of $27.1 billion at year-end 2021; $1.5 billion of voluntary pension contributions in 2021.
  7. Guidance for 2022: system capacity about 10% below 2019 for the full year, and non-fuel unit costs up 7%-10% versus 2019.

03—One dollar

04—Financials

Financial Highlights

Figures from 10-KFY2021filed February 11, 2022
Revenue$29.90BNet Income$280.00M0.9% Net MarginEPS (Diluted)$0.44Total Assets$72.46BCash & Equivalents$7.93BFree Cash Flow$3.26B

Financial Statements

FY2021 against FY2020

Line itemFY2021FY2020Change
Revenue$29.90B$17.09B+74.9%
Operating Expenses$28.01B$29.56B−5.2%
Operating Income$1.89B-$12.47B+115.1%
Net Income$280.00M-$12.38B+102.3%
EPS (Basic)$0.44$-19.49+102.3%
EPS (Diluted)$0.44$-19.49+102.3%
Shares Outstanding (Basic)636.00M636.00M0.0%
Shares Outstanding (Diluted)641.00M636.00M+0.8%

05—Questions

Frequently Asked Questions

  1. How much of Delta's 2021 pre-tax income came from government support?

    Pre-tax income of $398 million included recognition of $4.5 billion in grants from PSP2 and PSP3. Excluding the grant recognition and other items, the company reported a pre-tax loss, adjusted, of $3.4 billion.

  2. What drove the improvement in 2021 compared with 2020?

    Pre-tax income improved $16.0 billion versus 2020, mainly because 2020 included $8.2 billion of restructuring charges, investment impairments and equity method losses, and because demand recovered in 2021, lifting revenue 75% on 45% higher capacity.

  3. How is Delta managing its debt and liquidity?

    Delta repaid about $5.8 billion of debt and finance leases in 2021, including about $3.8 billion of early repayments, and ended the year with $14.2 billion of liquidity. The company says it expects liquidity to be between $5 billion and $6 billion by 2024 as it reduces obligations.

  4. What are the main cost pressures and outlook for 2022?

    Delta expects 2022 non-fuel unit costs to rise 7%-10% versus 2019 because capacity is lower, network rebuilding costs are rising, and inflation and labor costs are increasing. It also expects fuel consumption to rise as demand returns toward pre-pandemic levels.

  5. What is the outlook for international and business travel?

    Delta said it restored about 50% of international capacity in 2021 and does not expect the international network to be fully restored to 2019 levels until 2023. It expects business travel to recover more slowly than domestic leisure travel, with some acceleration as corporate offices reopen in 2022.

06—Continue

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