Delta Air Lines Announces December Quarter and Full Year 2020 Financial Results

December quarter 2020 GAAP pre-tax loss of $1.1 billion and loss per share of $1.19 on total revenue of $4.0 billion

ATLANTA, Jan. 14, 2021 /PRNewswire/ — Delta Air Lines (NYSE:DAL) today reported financial results for the December quarter and full year 2020 and provided its outlook for the March quarter 2021. Highlights of the December quarter and full year 2020 results, including both GAAP and adjusted metrics, are on page five and are incorporated here.

“Our December quarter results capped the toughest year in Delta’s history. I want to thank the Delta people who have risen to the occasion, focusing on delivering results for all of our stakeholders by putting our customers at the center of our recovery,” said Ed Bastian, Delta’s chief executive officer. “While our challenges continue in 2021, I am optimistic this will be a year of recovery and a turning point that results in an even stronger Delta returning to revenue growth, profitability and free cash generation.”

December Quarter Financial Results

   -- Adjusted pre-tax loss of $2.1 billion excludes nearly $1 billion of items 
      directly related to the impact of, and our response to, COVID-19, 
      including charges associated with employee pay and benefit changes, which 
      were offset by the benefit of the CARES Act payroll support program (PSP) 
      grant recognized in the quarter 
 
   -- Adjusted operating revenue of $3.5 billion declined 69 percent on 62 
      percent lower sellable capacity (see Note A) versus the prior year period 
 
   -- Total operating expense, which includes $930 million of items described 
      above, decreased $5.2 billion over prior year period.  Adjusted for those 
      items and third-party refinery sales, total operating expense decreased 
      $4.6 billion or 47 percent in the December quarter compared to the prior 
      year period, driven by lower capacity- and revenue-related expenses and 
      strong cost management across the business 
 
   -- During the December quarter cash burn (see Note B) averaged $12 million 
      per day, marking an approximate 90 percent reduction in cash burn since 
      late March 
 
   -- At the end of 2020, the company had $16.7 billion in liquidity, including 
      cash and cash equivalents, short-term investments and undrawn revolving 
      credit facilities 

Full Year 2020 Financial Results

   -- Adjusted pre-tax loss of $9.0 billion excludes a net of $6.6 billion of 
      items primarily related to the impact of, and our response to, COVID-19 
 
   -- Adjusted operating revenue of $15.9 billion declined 66 percent on 61 
      percent lower sellable capacity versus the prior year 
 
   -- Total operating expense, which includes $4.3 billion of COVID- related 
      and other items, decreased $10.8 billion over prior year.  Adjusted for 
      those items and third-party refinery sales, total operating expense 
      decreased $16.0 billion or 40 percent in 2020 compared to the prior year 

March Quarter 2021 Outlook

 
                                     1Q21 Forecast 
Scheduled Capacity (1)               Down 35% 
Sellable Capacity (1)                Down 55% 
Total Revenue (1, 2)                 Down 60% - 65% 
Total Operating Expense (1, 2)       Down 35% - 40% 
Consolidated CASM (1, 2)             Down 5% - 10% 
Capital Expenditures                 $350 million 
Average Daily Cash Burn (2)          $10-15 million 
Liquidity (3)                        $18-19 billion 
Adjusted Net Debt (2, 3)             $18 billion 
 
(1) Compared to March quarter 2019 
(2) Non-GAAP measure 
(3) Includes estimated PSP funds of $3.0 billion 
 

Revenue Environment

Delta’s adjusted operating revenue of $3.5 billion for the December quarter was down 69 percent versus the prior year period, a 10-point improvement from September quarter 2020. Passenger revenues declined 74 percent on 62 percent lower sellable capacity. Non-ticket revenues outperformed passenger revenues, with cargo revenues up 10 percent versus the prior year period and total loyalty revenues down 54 percent.

For the full year, adjusted operating revenue declined to $15.9 billion, down 66 percent versus 2019, as the global pandemic severely affected air travel. Passenger revenues declined 70 percent on 61 percent lower sellable capacity. Total loyalty revenues were down 51 percent and American Express remuneration declined 30 percent compared to prior year to $2.9 billion.

“We see three distinct phases in 2021. The early part of the year will be characterized by choppy demand recovery and a booking curve that remains compressed, followed by an inflection point, and finally a sustained demand recovery as customer confidence gains momentum, vaccinations become widespread and offices re-open,” said Glen Hauenstein, Delta’s president. “For each phase, Delta has the levers to pull to successfully react to the emerging demand environment, including tightly matching our sellable capacity to expected demand.”

Cost Performance

Total adjusted operating expense for the December quarter decreased $4.6 billion or 47 percent versus the prior year period excluding items related to the company’s response to COVID-19 and the $1.4 billion CARES Act benefit, resulting in Delta’s consolidated CASM, adjusted being 4.5 percent lower than the prior year period. This performance was driven by a $1.3 billion, or 64 percent reduction in fuel expense versus the prior year period, a 51 percent reduction in maintenance expense and lower volume- and revenue-related expenses. Salaries and related costs were down 34 percent compared to the prior year period as a result of approximately 20 percent of our workforce, or nearly 18,000 employees, electing to voluntarily depart the company, in addition to the impact of voluntary unpaid leaves, work hour reductions and other cost-saving initiatives.

Non-operating expense for the December quarter was up $248 million versus the prior year period, driven primarily by higher interest expense from increased debt the company has incurred during the COVID-19 pandemic.

“We reduced our average daily cash burn to $12 million in the December quarter, a reduction of nearly 90 percent since the early days of the pandemic in March, as we progress to achieving cash breakeven in the spring,” said Gary Chase, Delta’s interim co-chief financial officer. “Remaining agile and disciplined with our cost structure will be key to our success, and when combined with an improving demand environment, will allow us to return to the free cash flow generation needed for debt reduction.”

Balance Sheet, Cash and Liquidity

Delta ended the December quarter with $16.7 billion in liquidity. Cash used in operations during the quarter was $1.3 billion. Daily cash burn averaged $12 million for the quarter, down from $24 million per day in the September quarter.

The company anticipates receiving approximately $3 billion from the U.S. Treasury under the PSP extension in the March quarter. With these funds and an estimated $10 to $15 million in average daily cash burn for the March quarter, the company expects to end the March quarter with approximately $18 to $19 billion in liquidity.

At the end of the December quarter, the company had total debt and finance lease obligations of $29.2 billion with adjusted net debt of $18.8 billion, $8.3 billion higher year over year. The company’s total debt had a weighted average interest rate of 4.6 percent at year-end. During the quarter, the company repaid $2.6 billion under its revolving credit facilities drawn down in March 2020, $3 billion associated with the 364-day term loan entered into in March 2020 and a $450 million unsecured debt maturity. The company currently has $9 to $10 billion in unencumbered assets, primarily consisting of aircraft, engines and spare parts.

At the end of the December quarter, the company’s Air Traffic Liability stood at $4.5 billion, including a current liability of $4.0 billion and a non-current liability of $0.5 billion. Travel credits represent approximately 65 percent of the Air Traffic Liability at the end of the December quarter. The company refunded more than $3 billion to customers in 2020 and extended the use of certain travel credits through December 2022 to provide additional flexibility to customers.

Highlights from 2020

In 2020, Delta undertook a number of initiatives related to our culture and people, our customers’ experience and loyalty and other actions to protect and restore the business and serve our communities.

Culture and People: Delta’s number one priority during the pandemic has been taking care of our people. The following measures were taken to preserve our culture, create a more inclusive environment and protect the health and safety of our people

   -- Avoiding involuntary furloughs of U.S. employees by providing generous 
      voluntary separation and early retirement programs, voluntary unpaid 
      leaves, job sharing and other initiatives 
 
   -- Slowing the COVID-19 spread with an extensive employee testing program, 
      while helping ease the strain on the health system by offering free flu 
      shots for all U.S. employees 
 
   -- Protecting employees with pay protection programs for those diagnosed, 
      exposed or at high risk from COVID-19 
 
   -- Addressing systemic racial inequity with a commitment to double our spend 
      with Black-owned businesses and double the percentage of Black Officers 
      and Directors by 2025; a commitment to increase Black representation on 
      our Board of Directors; enhanced employee inclusion training; and joining 
      forces with organizations and coalitions that advance equity and justice, 
      including OneTen, Operation HOPE and others 
 
   -- Recognized by Glassdoor as one of the Best Places to Work for the fifth 
      year, ranking No. 7 on the 2021 list of 100 large companies, the highest 
      rank Delta has ever received 

Customer Experience and Loyalty: Delta’s innovative, customer-centric approach focused on customer health and safety and improving the travel experience during the challenges of the pandemic

   -- Blocking middle seats through at least March 30, 2021 -- the only major 
      U.S. airline to make such a commitment 
 
   -- Launched the industry's first COVID-tested flights from Atlanta to Rome 
      and Atlanta to Amsterdam with no quarantine on arrival 
 
   -- Created a Global Cleanliness organization and implemented the Delta 
      CareStandard, our ongoing, organization-wide commitment to cleanliness 
      and safety that includes mask requirements, regular sanitization of 
      surfaces, onboard use of industrial-grade HEPA filters and more than 100 
      other measures to ensure a safe travel experience 
 
   -- Eliminated change fees for U.S. customers and discontinued 
      redeposit/reissuance fees for SkyMiles members; extended Medallion member 
      benefits through January 2022 
 
   -- Unveiled Phase I of the new Salt Lake City airport, with accelerated 
      investment in Los Angeles and New York-LaGuardia airports to provide 
      customers state of the art facilities across our domestic network 

Actions Taken to Protect and Restore the Business: Delta took quick and decisive action to mitigate liquidity risk at the onset of the global pandemic. Financing transactions and efficiency initiatives have created a long-term competitive cost structure that will aid in the recovery of the airline

   -- Completed more than $25 billion in financing transactions in 2020, 
      including Delta's $9 billion SkyMiles financing, the largest debt 
      financing in aviation history 
 
   -- Received $5.6 billion in PSP proceeds through the CARES Act legislation 
      passed in March 2020, with $4.0 billion in grant funds, $1.6 billion in 
      low-interest rate loans and issuance of warrants for over 6.7 million 
      shares -- Delta's shareholder dilution of 1 percent in 2020 was primarily 
      attributable to warrants issued under the CARES Act 
 
   -- Restructured our aircraft orderbook, reducing aircraft purchase 
      commitments by $2 billion in 2020 and $5 billion through 2022 
 
   -- Accelerated its fleet simplification strategy with 227 aircraft 
      retirements in 2020, reducing the number of fleet families from 13 to 11. 
       Delta anticipates the cumulative retirement of nearly 400 aircraft 
      through 2025, further simplifying fleet families down to nine 
 
   -- Reduced total adjusted operating expense by 40 percent during the full 
      year 2020, with a nearly 50 percent or greater reduction in each of the 
      June, September and December quarters 

Serving our Communities: Continued to exhibit the Delta values of serving our communities and giving back to those in need

   -- Supported healthcare workers by manufacturing 70,000 face shields to 
      extend the life of essential N95 mask respirators, donating 800,000 
      pounds of snacks and drinks to hospitals in 20 different countries, and 
      provided more than 350 free flights for medical professionals traveling 
      to assist states that were heavily impacted by the pandemic 
 
   -- Donated more than one million pounds of food across the globe and 
      millions of amenity kits, blankets and dishware to social service 
      agencies 
 
   -- Maintained our commitment to serving our communities by partnering with 
      KABOOM! to build five playgrounds, building 750 bikes and contributing 
      1,300 toys and $735,000 in donations to Toys for Tots 
 
   -- Donated more than 10,000 pints of blood to the American Red Cross, 
      serving as the No. 1 American Red Cross corporate blood donor for the 
      third straight year 
 
   -- Supported and encouraged Delta people who volunteered their time and 
      talents to numerous charities and organizations 

CARES Act Accounting and Other COVID-19 Related Charges

In the December quarter, the remaining $1.4 billion of the CARES Act PSP grant was recognized as a contra-expense, which is reflected as “CARES Act grant recognition” on the Consolidated Statements of Operations.

During the December quarter, the company recorded $421 million in restructuring charges primarily related to employees benefits and other matters within operating expense.

December Quarter and Full Year 2020 Results

December quarter and full year results have been adjusted primarily for the CARES Act grant recognition, restructuring charges, and impairment charges described in this release.

 
                  GAAP             Adjusted         GAAP              Adjusted 
($ in millions 
except per share 
and unit costs)   4Q20     4Q19    4Q20     4Q19    FY20      FY19    FY20     FY19 
Pre-tax 
 (loss)/income    (1,108)  1,397   (2,121)  1,417   (15,587)  6,198   (8,996)  6,214 
Net 
 (loss)/income    (755)    1,099   (1,604)  1,098   (12,385)  4,767   (6,839)  4,776 
Diluted 
 (loss)/earnings 
 per share        (1.19)   1.71    (2.53)   1.70    (19.49)   7.30    (10.76)  7.32 
Operating 
 revenue          3,973    11,439  3,532    11,384  17,095    47,007  15,945   46,718 
Operating 
 expense          4,831    10,040  5,314    9,961   29,564    40,389  24,130   40,082 
Total cost per 
 available seat 
 mile (CASM)      13.21    15.34   14.53    15.21   22.01     14.67   17.96    14.56 
CASM-Ex                            12.57    11.59                     15.61    10.88 
Fuel expense      723      2,012   717      1,983   3,176     8,519   3,166    8,477 
Total debt and 
 finance lease 
 obligations      29,157   11,160  18,823   10,489  29,157    11,160  18,823   10,489 
Total revenue 
 per available 
 seat mile 
 (TRASM)          10.86    17.47   9.66     17.39   12.73     17.07   11.87    16.97 
Average fuel 
 price per 
 gallon           1.45     2.01    1.44     1.99    1.64      2.02    1.64     2.01 
 

About Delta Air Lines Delta Air Lines (NYSE: DAL) is the U.S. global airline leader in safety, innovation, reliability and customer experience. Powered by our employees around the world, Delta has for a decade led the airline industry in operational excellence while maintaining our reputation for award-winning customer service.

Today, and always, nothing is more important than the health and safety of our customers and employees. Since the onset of the COVID-19 pandemic, Delta has moved quickly to transform the industry standard of clean while offering customers more space across the travel journey. These and numerous other layers of protection ensure a safe and comfortable travel experience for our customers and employees.

With our mission of connecting the people and cultures of the globe, Delta strives to foster understanding across a diverse world and serve as a force for social good.

Forward Looking Statements

Statements in this press release that are not historical facts, including statements regarding our estimates, expectations, beliefs, intentions, projections or strategies for the future, may be “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. 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 and strategies reflected in or suggested by the forward-looking statements. Risks and uncertainties that could cause differences between actual results and forward-looking statements include, but are not limited to, the material adverse effect that the COVID-19 pandemic is having on our business; uncertainties with respect to timing of vaccine distribution and widespread vaccination; the impact of incurring significant debt in response to the pandemic; the possible effects of accidents involving our aircraft; breaches or security lapses in our information technology systems; disruptions in our information technology infrastructure; our dependence on technology in our operations; the performance of our significant investments in and commercial relationships with, airlines in other parts of the world; failure to comply with the financial and other covenants in our financing agreements; labor issues; the effects of weather, natural disasters and seasonality on our business; the effects of an extended disruption in services provided by third parties; the cost of aircraft fuel; the availability of aircraft fuel; failure or inability of insurance to cover a significant liability at Monroe’s Trainer refinery; the impact of environmental regulation on the Trainer refinery, including costs related to renewable fuel standard regulations; our ability to retain senior management and key employees and our culture; damage to our reputation and brand if we are exposed to significant adverse publicity; the effects of terrorist attacks or geopolitical conflict; competitive conditions in the airline industry; interruptions or disruptions in service at major airports at which we operate; the effects of extensive government regulation on our business; the impact of environmental regulation on our business; and the sensitivity of the airline industry to prolonged periods of stagnant or weak economic conditions.

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, 2019 and our Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2020. Caution should be taken not to place undue reliance on our forward-looking statements, which represent our views only as of January 14, 2021, and which we have no current intention to update except to the extent required by law.

 
DELTA AIR LINES, INC. 
Consolidated Statements of Operations 
(Unaudited) 
 
                      Three Months 
                      Ended                                   Year Ended 
                      December 31,                            December 31, 
(in millions, except 
per share data)       2020     2019     $ Change  % Change    2020       2019     $ Change   % Change 
Operating Revenue: 
Passenger             $2,698   $10,245  $(7,547)  (74)  %     $12,883    $42,277  $(29,394)  (70)  % 
Cargo                 204      187      17        10    %     608        753      (145)      (19)  % 
Other                 1,071    1,007    64        6     %     3,604      3,977    (373)      (9)   % 
 Total operating 
  revenue             3,973    11,439   (7,466)   (65)  %     17,095     47,007   (29,912)   (64)  % 
 
Operating Expense: 
Salaries and related 
 costs                1,940    2,949    (1,009)   (34)  %     8,754      11,225   (2,471)    (22)  % 
Aircraft fuel and 
 related taxes        723      2,012    (1,289)   (64)  %     3,176      8,519    (5,343)    (63)  % 
Regional carriers 
 expense, excluding 
 fuel                 591      885      (294)     (33)  %     2,479      3,584    (1,105)    (31)  % 
Depreciation and 
 amortization         499      622      (123)     (20)  %     2,312      2,581    (269)      (10)  % 
Ancillary businesses 
 and refinery         604      299      305       NM          1,785      1,245    540        43    % 
Contracted services   381      668      (287)     (43)  %     1,778      2,641    (863)      (33)  % 
Landing fees and 
 other rents          323      440      (117)     (27)  %     1,518      1,762    (244)      (14)  % 
Aircraft maintenance 
 materials and 
 outside repairs      204      417      (213)     (51)  %     822        1,751    (929)      (53)  % 
Passenger 
 commissions and 
 other selling 
 expenses             84       488      (404)     (83)  %     582        1,993    (1,411)    (71)  % 
Passenger service     90       313      (223)     (71)  %     523        1,251    (728)      (58)  % 
Aircraft rent         104      105      (1)       (1)   %     399        423      (24)       (6)   % 
Restructuring 
 charges              421      --       421       NM          8,219      --       8,219      NM 
CARES Act grant 
 recognition          (1,351)  --       (1,351)   NM          (3,946)    --       (3,946)    NM 
Profit sharing        --       387      (387)     (100) %     --         1,643    (1,643)    (100) % 
Other                 218      455      (237)     (52)  %     1,163      1,771    (608)      (34)  % 
Total operating 
 expense              4,831    10,040   (5,209)   (52)  %     29,564     40,389   (10,825)   (27)  % 
 
Operating 
 (Loss)/Income        (858)    1,399    (2,257)   NM          (12,469)   6,618    (19,087)   NM 
 
Non-Operating 
Expense: 
Interest expense, 
 net                  (365)    (72)     (293)     NM          (929)      (301)    (628)      NM 
Impairments and 
 equity method 
 (losses)/gains       --       18       (18)      (100) %     (2,432)    (62)     (2,370)    NM 
Gain/(loss) on 
 investments, net     94       136      (42)      (31)  %     (105)      119      (224)      NM 
Miscellaneous, net    21       (84)     105       NM          348        (176)    524        NM 
Total non-operating 
 expense, net         (250)    (2)      (248)     NM          (3,118)    (420)    (2,698)    NM 
 
(Loss)/Income Before 
 Income Taxes         (1,108)  1,397    (2,505)   NM          (15,587)   6,198    (21,785)   NM 
 
Income Tax 
 Benefit/(Provision)  353      (298)    651       NM          3,202      (1,431)  4,633      NM 
 
Net (Loss)/Income     $(755)   $1,099   $(1,854)  NM          $(12,385)  $4,767   $(17,152)  NM 
 
Basic 
 (Loss)/Earnings Per 
 Share                $(1.19)  $1.71                          $(19.49)   $7.32 
Diluted 
 (Loss)/Earnings Per 
 Share                $(1.19)  $1.71                          $(19.49)   $7.30 
 
Basic Weighted 
 Average Shares 
 Outstanding          635      642                            636        651 
Diluted Weighted 
 Average Shares 
 Outstanding          635      644                            636        653 
 
 
 
 
DELTA AIR LINES, INC. 
Passenger Revenue 
(Unaudited) 
 
                 Three Months 
                 Ended                                  Year Ended 
                 December 31,                           December 31, 
(in millions)    2020    2019     $ Change  % Change    2020     2019     $ Change   % Change 
Ticket- Main 
 cabin           $1,447  $5,238   $(3,791)  (72) %      $6,676   $21,919  $(15,243)  (70) % 
Ticket- 
 Business cabin 
 and premium 
 products        810     3,684    (2,874)   (78) %      4,294    14,989   (10,695)   (71) % 
Loyalty travel 
 awards          204     726      (522)     (72) %      935      2,900    (1,965)    (68) % 
Travel-related 
 services        237     597      (360)     (60) %      978      2,469    (1,491)    (60) % 
Total passenger 
 revenue         $2,698  $10,245  $(7,547)  (74) %      $12,883  $42,277  $(29,394)  (70) % 
 
 
 
DELTA AIR LINES, INC. 
Other Revenue 
(Unaudited) 
 
                 Three Months 
                 Ended                                  Year Ended 
                 December 31,                           December 31, 
(in millions)    2020    2019     $ Change  % Change    2020     2019     $ Change   % Change 
Ancillary 
 businesses and 
 refinery        $614    $307     $307      100  %      $1,798   $1,297   $501       39   % 
Loyalty program  372     519      (147)     (28) %      1,458    1,962    (504)      (26) % 
Miscellaneous    85      181      (96)      (53) %      348      718      (370)      (52) % 
Total other 
 revenue         $1,071  $1,007   $64       6    %      $3,604   $3,977   $(373)     (9)  % 
 
 
 
DELTA AIR LINES, INC. 
 Total Revenue 
 (Unaudited) 
 
                                       Increase (Decrease) 
                                       4Q20 versus 4Q19 
                                       Change  Unit 
Revenue                     4Q20 ($M)   YoY     Revenue  Yield  Capacity 
      Domestic             $2,229      (71)%   (55)%     (11)%  (36)% 
Atlantic                    157        (88)%   (62)%     9%     (69)% 
Latin America               234        (67)%   (52)%     (9)%   (31)% 
Pacific                     78         (87)%   (55)%     97%    (70)% 
Total Passenger            $2,698      (74)%   (53)%     (3)%   (44)% 
Cargo Revenue               204        10% 
Other Revenue               1,071      6% 
Total Revenue              $3,973      (65)%   (38)% 
      Third Party 
       Refinery Sales       (441) 
Total Revenue, adjusted    $3,532      (69)%   (44)% 
 
 
DELTA AIR LINES, INC. 
 Statistical Summary 
 (Unaudited) 
 
               Three Months Ended                    Year Ended 
               December 31,                          December 31, 
               2020         2019          Change     2020           2019           Change 
Revenue 
 passenger 
 miles 
 (millions)    15,183       56,028        (73)  %    73,412         237,680        (69)  % 
Available 
 seat miles 
 (millions)    36,569       65,468        (44)  %    134,339        275,379        (51)  % 
Passenger 
 mile yield 
 (cents)       17.77        18.29         (3)   %    17.55          17.79          (1)   % 
Passenger 
 revenue per 
 available 
 seat mile 
 (cents)       7.38         15.65         (53)  %    9.59           15.35          (38)  % 
Total revenue 
 per 
 available 
 seat mile 
 (cents)       10.86        17.47         (38)  %    12.73          17.07          (25)  % 
TRASM, 
 adjusted - 
 see Note B 
 (cents)       9.66         17.39         (44)  %    11.87          16.97          (30)  % 
Total cost 
 per 
 available 
 seat mile 
 (cents)       13.21        15.34         (14)  %    22.01          14.67          50    % 
Consolidated 
 CASM, 
 adjusted - 
 see Note B 
 (cents)       14.53        15.21         (4)   %    17.96          14.56          23    % 
CASM-Ex - see 
 Note B 
 (cents)       12.57        11.59         8     %    15.61          10.88          43    % 
Passenger 
 load factor   42    %      86      %     (44)  pts  55       %     86       %     (32)  pts 
Fuel gallons 
 consumed 
 (millions)    498          999           (50)  %    1,935          4,214          (54)  % 
Average price 
 per fuel 
 gallon        $1.45        $   2.01      (28)  %    $   1.64       $   2.02       (19)  % 
Average price 
 per fuel 
 gallon, 
 adjusted - 
 see Note B    $1.44        $   1.99      (28)  %    $   1.64       $   2.01       (18)  % 
 
 
DELTA AIR LINES, INC. 
Consolidated Statements of Cash Flows 
(Unaudited) 
                                                Three Months Ended 
                                                December 31, 
(in millions)                                   2020           2019 
Cash Flows From Operating Activities: 
Net (loss) income                               $   (755)      $1,099 
Depreciation and amortization                   499            622 
Deferred income taxes                           (350)          324 
Pension, postretirement and postemployment 
 payments greater than expense                  (87)           (447) 
Change in other payables, deferred revenue and 
 accrued liabilities                            692            (104) 
Changes in air traffic liability                (75)           (647) 
Deferred CARES Act grant recognition            (1,351)        -- 
Other, net                                      141            122 
    Net cash (used in)/provided by operating 
     activities                                 (1,286)        969 
 
Cash Flows From Investing Activities: 
Property and equipment additions: 
Flight equipment, including advance 
 refunds/(payments)                             (302)          (570) 
Ground property and equipment, including 
 technology                                     (246)          (502) 
Sale of equity investments                      --             278 
Purchase of short-term investments              (4,700)        -- 
Redemption of short-term investments            3,955          -- 
Proceeds from loans to others                   142            -- 
Other, net                                      103            15 
    Net cash used in investing activities       (1,048)        (779) 
 
Cash Flows From Financing Activities: 
Payments on debt and finance lease obligations  (6,241)        (516) 
Repurchase of common stock                      --             (225) 
Cash dividends                                  --             (259) 
Proceeds from long-term obligations             310            1,557 
Fuel card obligation                            --             297 
Other, net                                      (26)           (12) 
    Net cash (used in)/provided by financing 
     activities                                 (5,957)        842 
 
Net Increase/(Decrease) in Cash, Cash 
 Equivalents and Restricted Cash Equivalents    (8,291)        1,032 
Cash, cash equivalents and restricted cash 
 equivalents at beginning of period             18,346         2,698 
Cash, cash equivalents and restricted cash 
 equivalents at end of period                   $   10,055     $3,730 
 
 
The following table provides a reconciliation of cash, cash 
equivalents and restricted cash reported within the Consolidated 
Balance Sheets to the total of the same such amounts shown above: 
 
Current assets: 
    Cash and cash equivalents                   $   8,307      $2,882 
    Restricted cash included in prepaid 
     expenses and other                         192            212 
Other assets: 
    Cash restricted for airport construction    1,556          636 
Total cash, cash equivalents and restricted 
 cash equivalents                               $   10,055     $3,730 
 
 
 
 
DELTA AIR LINES, INC. 
Consolidated Balance Sheets 
(Unaudited) 
 
                                        December 31,    December 31, 
(in millions)                           2020            2019 
ASSETS 
Current Assets: 
 Cash and cash equivalents              $   8,307       $   2,882 
 Short-term investments                 5,789           -- 
 Accounts receivable, net               1,396           2,854 
 Fuel inventory                         377             730 
 Expendable parts and supplies 
  inventories, net                      355             521 
 Prepaid expenses and other             1,180           1,262 
     Total current assets               17,404          8,249 
 
Property and Equipment, Net: 
 Property and equipment, net            26,529          31,310 
 
Other Assets: 
 Operating lease right-of-use assets    5,733           5,627 
 Goodwill                               9,753           9,781 
 Identifiable intangibles, net          6,011           5,163 
 Cash restricted for airport 
  construction                          1,556           636 
 Equity investments                     1,665           2,568 
 Deferred income taxes, net             2,043           120 
 Other noncurrent assets                1,357           1,078 
     Total other assets                 28,118          24,973 
Total assets                            $   72,051      $   64,532 
 
LIABILITIES AND STOCKHOLDERS' EQUITY 
Current Liabilities: 
 Current maturities of debt and 
  finance leases                        $   1,732       $   2,287 
 Current maturities of operating 
  leases                                678             801 
 Air traffic liability                  4,044           5,116 
 Accounts payable                       2,840           3,266 
 Accrued salaries and related benefits  2,086           3,701 
 Loyalty program deferred revenue       1,777           3,219 
 Fuel card obligation                   1,100           736 
 Other accrued liabilities              1,670           1,078 
     Total current liabilities          15,927          20,204 
 
Noncurrent Liabilities: 
 Debt and finance leases                27,425          8,873 
 Noncurrent air traffic liability       500             -- 
 Pension, postretirement and related 
  benefits                              10,865          8,452 
 Loyalty program deferred revenue       5,405           3,509 
 Noncurrent operating leases            5,713           5,294 
 Deferred income taxes, net             --              1,456 
 Other noncurrent liabilities           4,863           1,386 
     Total noncurrent liabilities       54,771          28,970 
 
Commitments and Contingencies 
 
Stockholders' Equity:                   1,353           15,358 
Total liabilities and stockholders' 
 equity                                 $   72,051      $   64,532 
 

Note A: Scheduled capacity, also referred to as available seat miles or ASMs and which we have historically presented as a capacity measure, equals the total number of seats available for transporting passengers during a reporting period multiplied by the total number of miles flown during that period. Sellable capacity refers to available seat miles after giving effect to load factor caps and blocked seats. Cost and revenue unit metrics in this release, including all measures presented in the statistical summary and in Note B, are calculated on the basis of scheduled capacity.

Note B: 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 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.

Pre-Tax (Loss)/Income, Net (Loss)/Income, and Diluted (Loss)/Earnings per Share, adjusted. In the December 2020 quarter and full year 2020, pre-tax (loss)/income, net (loss)/income, and diluted (loss)/earnings per share, adjusted exclude the following items directly related to the impact of COVID-19 and our response for comparability with the prior period:

Restructuring charges. We recognized restructuring charges following strategic business decisions in response to the COVID-19 pandemic. For the full year 2020, these charges primarily include impairments and related charges from retirement decisions related to approximately 400 aircraft and the voluntary early retirement and separation programs.

CARES Act grant recognition. We recognized the full grant proceeds from the CARES Act payroll support program as a contra-expense in 2020. We recognized the grant proceeds based on the periods that the funds were intended to benefit.

Impairments and equity method losses. During 2020, we recognized charges and the related income tax impacts from write-downs of our investments in LATAM and Grupo Aeroméxico following their financial losses and separate Chapter 11 bankruptcy filings, and the write-down of our investment in Virgin Atlantic based on our share of its historical and projected losses.

Pension settlement charges. These charges were recognized in connection with the voluntary early retirement and separation programs.

We also regularly adjust pre-tax (loss)/income, net (loss)/income, and diluted (loss)/earnings per share for the following items to determine pre-tax (loss)/income, net (loss)/income, and diluted (loss)/earnings per share, adjusted for the reasons described below. We include the income tax effect of adjustments when presenting net (loss)/income, adjusted.

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. Settlements represent cash received or paid on hedge contracts settled during the applicable period.

Equity investment MTM adjustments. We previously recorded our proportionate share of losses from our equity investments in Virgin Atlantic, Grupo Aeroméxico and LATAM in non-operating expense. (As a result of Grupo Aeroméxico’s and LATAM’s bankruptcy filings, we no longer have significant influence with Grupo Aeroméxico or LATAM and have discontinued accounting for these investments under the equity method in the June 2020 quarter.) We adjust for our equity method investees’ hedge portfolio MTM adjustments to allow investors to understand and analyze our core operational performance in the periods shown.

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.

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.

 
                                                Three Months 
                Three Months Ended              Ended 
                                                December 31, 
                December 31, 2020               2020 
                Pre-Tax    Income    Net        Net Loss 
(in millions, 
except per                                       Per Diluted 
share data)     Loss       Tax       Loss        Share 
GAAP            $(1,108)   $353      $(755)     $    (1.19) 
Less: 
 Restructuring 
 charges        421        (99)      322 
Less: CARES 
 Act grant 
 recognition    (1,351)    314       (1,037) 
Less: 
 Impairments 
 and equity 
 method 
 losses         --         (47)      (47) 
Less: Pension 
 settlement 
 charges        5          (1)       4 
Adjusted for: 
MTM 
 adjustments 
 and 
 settlements 
 on hedges      6          (2)       4 
Equity 
investment MTM 
adjustments     --         --        -- 
MTM 
 adjustments 
 on 
 investments    (94)       (1)       (95) 
Non-GAAP        $(2,121)   $516      $(1,604)   $    (2.53) 
 
 
                                                Three Months 
                Three Months Ended              Ended 
                                                December 31, 
                December 31, 2019               2019 
                Pre-Tax    Income    Net        Net Income 
(in millions, 
except per                                       Per Diluted 
share data)     Income     Tax       Income      Share 
GAAP            $1,397     $(298)    $1,099     $    1.71 
Adjusted for: 
MTM 
 adjustments 
 and 
 settlements 
 on hedges      22         (5)       17 
Equity 
 investment 
 MTM 
 adjustments    (1)        --        (1) 
MTM 
 adjustments 
 on 
 investments    (3)        (16)      (19) 
Delta Private 
 Jets 
 adjustment     2          --        2 
Non-GAAP        $1,417     $(319)    $1,098     $    1.70 
 
                Year Ended                      Year Ended 
                                                December 31, 
                December 31, 2020               2020 
                Pre-Tax    Income    Net        Net Loss 
(in millions, 
except per                                       Per Diluted 
share data)     Loss       Tax       Loss        Share 
GAAP            $(15,587)  $3,202    $(12,385)  $    (19.49) 
Less: 
 Restructuring 
 charges        8,219      (1,910)   6,309 
Less: CARES 
 Act grant 
 recognition    (3,946)    917       (3,029) 
Less: 
 Impairments 
 and equity 
 method 
 losses         2,172      (70)      2,102 
Less: Pension 
 settlement 
 charges        36         (8)       28 
Adjusted for: 
MTM 
 adjustments 
 and 
 settlements 
 on hedges      10         (2)       8 
Equity 
 investment 
 MTM 
 adjustments    (19)       4         (15) 
MTM 
 adjustments 
 on 
 investments    119        24        143 
Non-GAAP        $(8,996)   $2,156    $(6,839)   $    (10.76) 
 
 
                Year Ended                      Year Ended 
                                                December 31, 
                December 31, 2019               2019 
                Pre-Tax    Income    Net        Net Income 
(in millions, 
except per                                       Per Diluted 
share data)     Income     Tax       Income      Share 
GAAP            $6,198     $(1,431)  $4,767     $    7.30 
Adjusted for: 
MTM 
 adjustments 
 and 
 settlements 
 on hedges      14         (3)       11 
Equity 
 investment 
 MTM 
 adjustments    (14)       3         (11) 
MTM 
 adjustments 
 on 
 investments    13         (7)       6 
Delta Private 
 Jets 
 adjustment     3          --        3 
Non-GAAP        $6,214     $(1,438)  $4,776     $    7.32 
 

Operating Revenue, adjusted and Total Revenue Per Available Seat Mile (“TRASM”), adjusted. We adjust operating revenue and TRASM for third party refinery sales for the reasons described below. We make an adjustment related to Delta Private Jets for the same reason described above under the heading pre-tax (loss)/income, net (loss)/income, and diluted (loss)/earnings per share, adjusted.

Third-party refinery sales. We adjust operating revenue and TRASM for refinery sales to third parties to determine operating revenue, adjusted and TRASM, adjusted because these revenues are not related to our airline segment. Operating revenue, adjusted and TRASM, adjusted therefore provides a more meaningful comparison of revenue from our airline operations to the rest of the airline industry.

 
                    Three Months Ended 
(in millions)       December 31, 2020   December 31, 2019   Change 
Operating revenue   $    3,973          $    11,439 
Adjusted for: 
    Third-party 
     refinery 
     sales          (441)               (2) 
    Delta Private 
     Jets 
     adjustment     --                  (53) 
Operating revenue, 
 adjusted           $    3,532          $    11,384         (69)% 
 
                    Year Ended 
(in millions)       December 31, 2020   December 31, 2019   Change 
Operating revenue   $    17,095         $    47,007 
Adjusted for: 
Third-party 
 refinery sales     (1,150)             (97) 
Delta Private Jets 
 adjustment         --                  (192) 
Operating revenue, 
 adjusted           $    15,945         $    46,718         (66)% 
 
                    Three Months Ended 
                    December 31, 2020   December 31, 2019   Change 
TRASM (cents)       10.86               17.47 
Adjusted for: 
    Third-party 
    refinery 
    sales           (1.21)              -- 
    Delta Private 
     Jets 
     adjustment     --                  (0.08) 
TRASM, adjusted     9.66                17.39               (44)% 
 
                    Year Ended 
                    December 31, 2020   December 31, 2019   Change 
TRASM (cents)       12.73               17.07 
Adjusted for: 
    Third-party 
     refinery 
     sales          (0.86)              (0.04) 
    Delta Private 
     Jets 
     adjustment     --                  (0.07) 
TRASM, adjusted     11.87               16.97               (30)% 
 

Operating Expense, adjusted and Consolidated CASM, adjusted. In the December 2020 quarter and full year 2020, operating expense, adjusted and consolidated CASM, adjusted exclude the following items directly related to the impact of COVID-19 and our response: restructuring charges and CARES Act grant recognition, as discussed above under the heading pre-tax (loss)/income, net (loss)/income, and diluted (loss)/earnings per share, adjusted. We also adjust operating expense and CASM for MTM adjustments and settlements on hedges, third-party refinery sales and the Delta Private Jets adjustment for the same reasons described above under the headings pre-tax (loss)/income, net (loss)/income, and diluted (loss)/earnings per share, adjusted, and operating revenue, adjusted and TRASM, adjusted to determine operating expense, adjusted and consolidated CASM, adjusted.

 
                      Operating Expense           Consolidated CASM 
                      Three Months Ended          Three Months Ended 
(operating expense 
in millions, CASM in  December 31,  December 31,  December   December 
cents)                2020          2019          31, 2020   31, 2019 
GAAP                  $    4,831    $    10,040   13.21      15.34 
Less: Restructuring 
 charges              (421)         --            (1.15)     -- 
Less: CARES Act 
 grant recognition    1,351         --            3.69       -- 
Adjusted for: 
MTM adjustments and 
 settlements on 
 hedges               (6)           (22)          (0.02)     (0.03) 
Third-party refinery 
 sales                (441)         (2)           (1.21)     (0.01) 
Delta Private Jets 
 adjustment           --            (55)          --         (0.08) 
Non-GAAP              $    5,314    $    9,961    14.53      15.21 
 
 
                      Operating Expense           Consolidated CASM 
                      Year Ended                  Year Ended 
(operating expense 
in millions, CASM in  December 31,  December 31,  December   December 
cents)                2020          2019          31, 2020   31, 2019 
GAAP                  $    29,564   $    40,389   22.01      14.67 
Less: Restructuring 
 charges              (8,219)       --            (6.12)     -- 
Less: CARES Act 
 grant recognition    3,946         --            2.94       -- 
Adjusted for: 
MTM adjustments and 
 settlements on 
 hedges               (10)          (14)          (0.01)     (0.01) 
Third-party refinery 
 sales                (1,150)       (97)          (0.86)     (0.04) 
Delta Private Jets 
 adjustment           --            (196)         --         (0.07) 
Non-GAAP              $    24,130   $    40,082   17.96      14.56 
 
 
                      Operating Expense           Consolidated CASM 
                      Three Months Ended          Three Months Ended 
(operating expense 
in millions, CASM in  September     September     September  September 
cents)                30, 2020      30, 2019      30, 2020   30, 2019 
GAAP                  $    9,448    $    10,489   33.40      13.85 
Less: Restructuring 
 charges              (5,345)       --            (18.89)    -- 
Less: CARES Act 
 grant recognition    1,315         --            4.65       -- 
Adjusted for: 
MTM adjustments and 
 settlements on 
 hedges               3             25            0.01       0.03 
Third-party refinery 
 sales                (417)         (6)           (1.47)     (0.01) 
Delta Private Jets 
 adjustment           --            (49)          --         (0.06) 
Non-GAAP              $    5,004    $    10,460   17.69      13.81 
 
 
                      Operating Expense           Consolidated CASM 
                      Three Months Ended          Three Months Ended 
(operating expense 
in millions, CASM in  June 30,      June 30,      June 30,   June 30, 
cents)                2020          2019          2020       2019 
GAAP                  $    6,283    $    10,408   59.30      14.51 
Less: Restructuring 
 charges              (2,454)       --            (23.15)    -- 
Less: CARES Act 
 grant recognition    1,280         --            12.08      -- 
Adjusted for: 
MTM adjustments and 
 settlements on 
 hedges               (14)          (10)          (0.14)     (0.01) 
Third-party refinery 
 sales                (292)         (40)          (2.76)     (0.06) 
Delta Private Jets 
 adjustment           --            (50)          --         (0.07) 
Non-GAAP              $    4,803    $    10,308   45.33      14.37 
 
 
                            Operating Expense     Consolidated CASM 
                            Three Months Ended    Three Months Ended 
(operating expense in 
millions, CASM in cents)    March 31, 2019        March 31, 2019 
GAAP                        $    9,452            15.14 
Adjusted for: 
MTM adjustments and 
 settlements on hedges      (8)                   (0.01) 
Third-party refinery sales  (49)                  (0.08) 
Delta Private Jets 
 adjustment                 (42)                  (0.07) 
Non-GAAP                    $    9,354            14.99 
 

Cash Burn. We present cash burn because management believes this metric is helpful to investors to evaluate the company’s ability to maintain liquidity and return to cash generation. The company defines cash burn as net cash from operating activities and net cash used in investing activities, adjusted for (i) net purchases of short-term investments, (ii) strategic investments and related, (iii) net cash flows related to certain airport construction projects, (iv) aircraft financing arrangements, (v) CARES Act grant proceeds, and (vi) other charges that are not representative of our core operations, such as charges associated with our voluntary separation and early retirement programs. Adjustments include:

Net purchases of short-term investments. Net purchases of short-term investments represent the net purchase and sale activity of investments and marketable securities in the period, including gains and losses. We adjust for this activity to provide investors a better understanding of the company’s free cash flow generated by our operations.

Strategic investments and related. Cash flows related to our investments in and related transactions with other airlines are included in our GAAP investing activities. We adjust for this activity because it provides a more meaningful comparison to our airline industry peers.

Net cash flows related to certain airport construction projects and other. Cash flows related to certain airport construction projects are included in our GAAP operating activities and capital expenditures. We have adjusted for these items, which were primarily funded by cash restricted for airport construction, to provide investors a better understanding of the company’s free cash flow and capital expenditures that are core to our operations in the periods shown.

Aircraft financing arrangements. Cash flows from payments reported within investing activities related to the purchase of aircraft that are fully financed in the period are removed from free cash flow in calculating daily cash burn to better illustrate the cash generated from our core operations.

CARES Act grant proceeds. Cash flows related to the CARES act payroll support program grant proceeds, reported within operating activities in GAAP results. We adjust free cash flow for this item in calculating daily cash burn to better illustrate the cash from our core operations.

Voluntary programs. Cash flows from the voluntary separation and early retirement programs offered to employees during the September quarter, reported within operating activities in GAAP results. We adjust free cash flow for this item in calculating daily cash burn to better illustrate the cash from our core operations.

 
                          Three Months Ended    Three Months Ended 
(in millions)             December 31, 2020     September 30, 2020 
Net cash used in 
 operating activities     $    (1,286)          $    (2,575) 
Net cash used in 
 investing activities     (1,048)               (1,144) 
Adjustments: 
Net purchases of 
 short-term 
 investments              745                   745 
Strategic investments 
 and related              (142)                 235 
Net cash flows related 
 to certain airport 
 construction projects 
 and other                116                   208 
Total free cash flow      $    (1,615)          $    (2,531) 
Aircraft financing 
 arrangements             310                   37 
CARES Act grant 
 proceeds                 --                    (491) 
Voluntary programs        206                   813 
Adjusted free cash flow   $    (1,099)          $    (2,173) 
Days in period            92                    92 
Average daily cash burn   $    (12)             $    (24) 
 
 
 

Non-Fuel Unit Cost or Cost per Available Seat Mile, (“CASM-Ex”). In the December 2020 quarter and full year 2020, CASM-Ex exclude the following items directly related to the impact of COVID-19 and our response: restructuring charges and CARES Act grant recognition, as discussed above under the heading pre-tax (loss)/income, net (loss)/income, and diluted (loss)/earnings per share, adjusted. We adjust for refinery sales to third parties for the same reason described above under the heading operating revenue, adjusted and TRASM, adjusted. We adjust for Delta Private Jets for the same reason described above under the heading pre-tax (loss)/income, net (loss)/income, and diluted (loss)/earnings per share, adjusted. We also adjust CASM for the following items to determine CASM-Ex for the reasons described below.

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 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.

 
                     Three Months Ended 
                     December 31,     December 31, 
                     2020             2019              Change 
CASM (cents)         13.21            15.34 
Less: Restructuring 
charges              (1.15)           -- 
Less: CARES Act 
grant recognition    3.69             -- 
Adjusted for: 
    Aircraft fuel 
     and related 
     taxes           (1.98)           (3.08) 
    Third-party 
    refinery sales   (1.21)           -- 
    Profit sharing   --               (0.59) 
    Delta Private 
     Jets 
     adjustment      --               (0.07) 
CASM-Ex              12.57            11.59             8  % 
 
 
 
                     Year Ended 
                     December 31,     December 31, 
                     2020             2019              Change 
CASM (cents)         22.01            14.67 
Less: Restructuring 
charges              (6.12)           -- 
Less: CARES Act 
grant recognition    2.94             -- 
Adjusted for: 
    Aircraft fuel 
     and related 
     taxes           (2.36)           (3.10) 
    Third-party 
     refinery 
     sales           (0.86)           (0.04) 
    Profit sharing   --               (0.60) 
    Delta Private 
     Jets 
     adjustment      --               (0.06) 
CASM-Ex              15.61            10.88             43 % 
 
 
 

Fuel expense, adjusted and Average fuel price per gallon, adjusted. The tables below show the components of fuel expense, including the impact of hedging and the refinery on fuel expense and average price per gallon. We then adjust for MTM adjustments and settlements on hedges and Delta Private Jets for the same reasons described under the heading pre-tax (loss)/income, net (loss)/ income, and diluted (loss)/earnings per share, adjusted.

 
                                         Average Price Per Gallon 
                                         ------------------------- 
                  Three Months Ended     Three Months Ended 
                  December 31,           December 31, 
(in millions, 
except per 
gallon data)      2020           2019    2020          2019 
Fuel purchase 
 cost             $   615        $2,013  $      1.23   $   2.02 
Fuel hedge 
 impact           6              23      0.01          0.02 
Refinery segment 
 impact           102            (24)    0.21          (0.03) 
Total fuel 
 expense          $   723        $2,012  $      1.45   $   2.01 
MTM adjustments 
 and settlements 
 on hedges        (6)            (23)    (0.01)        (0.02) 
Delta Private 
 Jets 
 adjustment       --             (6)     --            (0.01) 
Total fuel 
 expense, 
 adjusted         $   717        $1,983  $      1.44   $   1.99 
 
 
                                         Average Price Per Gallon 
                                         ------------------------- 
                  Year Ended             Year Ended 
                  December 31,           December 31, 
(in millions, 
except per 
gallon data)      2020           2019    2020          2019 
Fuel purchase 
 cost             $   2,938      $8,581  $      1.52   $   2.04 
Fuel hedge 
 impact           22             14      0.01          -- 
Refinery segment 
 impact           216            (76)    0.11          (0.02) 
Total fuel 
 expense          $   3,176      $8,519  $      1.64   $   2.02 
MTM adjustments 
 and settlements 
 on hedges        (10)           (14)    (0.01)        -- 
Delta Private 
 Jets 
 adjustment       --             (28)    --            (0.01) 
Total fuel 
 expense, 
 adjusted         $   3,166      $8,477  $      1.64   $   2.01 
 
 
Percent change 
 year-over-year   (63)     % 
 

Adjusted Net Debt. Delta uses adjusted total debt, including aircraft rent, in addition to adjusted debt and finance leases, to present estimated financial obligations. Delta reduces adjusted total debt by cash, cash equivalents and short-term investments, and LGA restricted cash, resulting in adjusted net debt, to present the amount of assets needed to satisfy the debt. Management believes this metric is helpful to investors in assessing the company’s overall debt profile.

 
 
(in millions)                                        December 31, 2020 
Debt and finance lease obligations                   $      29,157 
Plus: sale-leaseback financing liabilities           2,283 
Plus: unamortized discount/(premium) and debt 
 issue cost, net and other                           240 
Adjusted debt and finance lease obligations          $      31,680 
Plus: 7x last twelve months' aircraft rent           2,794 
Adjusted total debt                                  $      34,475 
Less: cash, cash equivalents and short-term 
 investments                                         (14,096) 
Less: LGA restricted cash                            (1,556) 
Adjusted net debt                                    $      18,823 
 
 
(in millions)                                        December 31, 2019 
Debt and finance lease obligations                   $      11,160 
Plus: sale-leaseback financing liabilities           -- 
Plus: unamortized discount/(premium) and debt 
 issue cost, net and other                           (115) 
Adjusted debt and finance lease obligations          $      11,044 
Plus: 7x last twelve months' aircraft rent           2,963 
Adjusted total debt                                  $      14,007 
Less: cash, cash equivalents and short-term 
 investments                                         (2,882) 
Less: LGA restricted cash                            (636) 
Adjusted net debt                                    $      10,489 
 
 
 
 
 

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SOURCE Delta Air Lines

/CONTACT: Investor Relations, 404-715-2170, [email protected]; Corporate Communications, 404-715-2554, [email protected]

/Web site: www.delta.com

Della C. Mae

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