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Delta Air Lines 8-K Report, Regulation FD Disclosure (Mar 12, 2024)

Reports
Regulation FD
Filing Date
Filed March 12, 2024
Period End
March 12, 2024
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 · Apr ’18Apr ’18
  2. Impairment8-K · May ’20May ’20
  3. Material agreement8-K · Jul ’22Jul ’22
  4. Material agreement8-K · Jun ’26Jun ’26

01—Abstract

Summary

Summary of the 8-K filed March 12, 2024. Cited figures are marked; the original filing is the authoritative source.

Delta Air Lines, Inc. filed this Form 8-K under Item 7.01 (Regulation FD Disclosure) on March 12, 2024, to state that executives would present at the J.P.

Morgan Industrials Conference that day and to reaffirm its full-year 2024 and March quarter outlook, previously provided on January 12, 2024. Delta expects year-over-year total revenue growth for the March quarter to fall in the top half of its initial guidance range. The full-year 2024 forecast calls for earnings per share of $6 to $7,a free cash flow of $3 billion to $4 billion, and adjusted debt to EBITDAR of 2x to 3x.

For the first quarter of 2024, Delta projects total revenue growth of 3% to 6% year over year, an operating margin of approximately 5%, and earnings per share of $0.25 to $0.50b. The filing includes reconciliations of non-GAAP measures. For the March 2024 quarter, projected total revenue is $13.3 billion to $13.65 billion, which falls to $12.2 billion to $12.55 billion when third-party refinery sales of approximately $1.1 billion are excluded.

Projected GAAP operating margin of approximately 4% rises to approximately 5% on the same adjustment. Projected GAAP diluted EPS of $0.00 to $0.25c becomes $0.25 to $0.50 after an approximately $0.2 billion mark-to-market adjustment on investments. The filing notes that certain forward-looking non-GAAP measures cannot be reconciled without unreasonable effort.

02—Key points

Key Highlights

  1. Reaffirmed FY24 outlook: EPS of $6-$7, free cash flow of $3-$4 billion, and adjusted debt to EBITDAR of 2x-3x, unchanged from the January 12, 2024 guidance.
  2. Reaffirmed 1Q24 outlook: total revenue up 3%-6% year over year, operating margin of approximately 5%, and EPS of $0.25-$0.50.
  3. Expects March quarter year-over-year total revenue growth in the top half of the initial guidance range.
  4. Projected 1Q24 total revenue of $13.3-$13.65 billion, or $12.2-$12.55 billion excluding third-party refinery sales of approximately $1.1 billion.
  5. Projected 1Q24 GAAP operating margin of approximately 4%, or approximately 5% on an adjusted basis excluding third-party refinery sales.
  6. Projected 1Q24 GAAP diluted EPS of $0.00-$0.25 reconciles to non-GAAP EPS of $0.25-$0.50, primarily adjusting for approximately $0.2 billion in mark-to-market adjustments on investments.
  7. Filing is a reaffirmation and presentation notice with no new financial results reported.

03—Questions

Frequently Asked Questions

  1. Did Delta change its full-year 2024 or first-quarter 2024 guidance in this filing?

    No. Delta stated it is reaffirming the outlook it previously provided on January 12, 2024, for full-year 2024 and the March 2024 quarter.

  2. What revenue growth does Delta expect for the March 2024 quarter?

    Delta expects year-over-year total revenue growth in the top half of its initial guidance range, which is 3% to 6%.

  3. Why does Delta present adjusted figures that exclude third-party refinery sales?

    The filing says refinery sales to third parties and related expenses are not related to Delta's airline segment. Excluding them is intended to allow a more meaningful comparison of its airline operations with the rest of the airline industry.

  4. What is driving the difference between GAAP and non-GAAP first-quarter 2024 EPS?

    The difference reflects mark-to-market adjustments on equity investments, which the filing projects at approximately $0.2 billion of pre-tax income. Non-GAAP EPS is projected at $0.25-$0.50 compared with GAAP EPS of $0.00-$0.25.

  5. What does the filing say about the 2024 outlook's dependence on factors beyond guidance?

    The filing lists forward-looking risks including fuel cost increases, disruptions in fuel supply from Monroe Energy, LLC's Trainer refinery, labor issues, competitive conditions, and changes in the value of equity investments. It also states that certain forward-looking non-GAAP measures cannot be reconciled without unreasonable effort because adjusting items will not be known until the periods end.

04—Continue

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