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Cash incineration halved



A Delta Air Lines plane lands at Los Angeles International Airport

Mario Tama | Getty Images

Delta Air Lines said Thursday it halved its liquidity and reduced its losses in the fourth quarter as the coronavirus pandemic drove the carrier into its worst year ever.

The Atlanta-based airline posted a net loss of nearly $ 1

2.39 billion. Dollars in 2020 – a record according to FactSet data.

Here’s how Delta fared in the quarter compared to what Wall Street expected, based on average estimates compiled by Refinitiv:

  • Adjusted earnings per Share: a loss of $ 2.53 against an expected loss of $ 2.50
  • Total revenue: DKK 3.97 billion. $ Versus expected 3.59 billion

Delta swung to a net loss of $ 755 million in the fourth quarter compared to a profit of $ 1.1 billion. Dollars the year before. Total revenue fell 65% from $ 11.44 billion in the fourth quarter of 2019 to $ 3.97 billion. The company’s revenue received a $ 441 million boost from third-party refinery sales. On an adjusted basis, Delta had a loss per. Shares of $ 2.53 compared to analyst estimates for a loss of $ 2.50 per share. Shares.

The airline’s cash burn averaged $ 12 million a day in the quarter ended December 31, down by half from its average cash burn of $ 24 million a day in the third quarter. Delta has said it expects to come to a positive cash flow by spring.

Delta shares rose 1.5% in pre-market trading after Delta reported its results.

The airline will face difficult months ahead, but sees a recovery in 2021 as Covid vaccines are administered around the country, CEO Ed Bastian said.

“As our challenges continue into 2021, I am optimistic that 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,” Bastian said.

Delta said it expects revenue to fall 60% to 65% in the first quarter of the year compared to the year before, just as the pandemic started. This is worse than analysts’ estimates for a 48% year-over-year decline.

The pandemic ruined the need for travel, as concerns over viruses, quarantines, travel restrictions and business travel breaks kept millions of potential customers at home. The Transportation Security Administration screened only 324 million travelers last year, down from 824 million in 2019.

Airline executives have been hopeful that the rollout of vaccines would provide some relief, but have repeatedly warned that it will not be immediate.

“The early part of the year will be marked by turbulent demand for recovery and a booking curve that remains compressed, followed by a bending point and finally a sustained demand as customer confidence gains momentum, vaccinations become widespread and offices reopen,” Delta President Glen Hauenstein said in the earnings announcement.

Delta said it ended the fourth quarter with $ 16.7 billion. In liquidity. Delta raised billions in debt last year, including record $ 9 billion in debt sales backed by its frequent flyer program SkyMiles.

The carrier and its rivals are also receiving additional federal funding to help withstand the crisis. At the end of last year, Congress approved $ 15 billion. In additional federal support for airlines to pay workers over $ 25 billion. $ In government wage support they received under the March CARES Act.


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