ATLANTA, July 14, 2021 – Delta Air Lines (NYSE: DAL) today reported financial results for the June quarter 2021 and provided its outlook for the September quarter 2021. Highlights of the June quarter 2021 results, including both GAAP and adjusted metrics, are on page six and are incorporated here.
June Quarter Financial Results
Adjusted pre-tax loss of $881 million excludes $1.5 billion of benefit related to the first and second payroll support program extensions (PSP2 and PSP3, respectively) and mark-to-market adjustments on our investments
Adjusted operating revenue of $6.3 billion, which excludes refinery sales, declined 49 percent on 39 percent lower sellable capacity (see Note A) versus June quarter 2019
Total operating expense, which includes $1.5 billion of benefit related to PSP2 and PSP3, decreased $4.1 billion relative to the June quarter 2019. Adjusted for the benefit related to the PSP programs and third-party refinery sales, total operating expense decreased $3.3 billion or 32 percent in the June quarter 2021 versus the comparable 2019 period
Generated $1.9 billion of operating cash flow, $1.5 billion of free cash flow and $195 million of free cash flow, adjusted in the June quarter
At the end of the June quarter, the company had $17.8 billion in liquidity, including cash and cash equivalents, short-term investments and undrawn revolving credit facilities. The company had total debt and finance lease obligations of $29.1 billion with adjusted net debt of $18.3 billion
Click the link below to read the full release, including the reconciliations of GAAP to non-GAAP financial measures:
Reported net loss for the fourth quarter and full year 2020 under Generally Accepted Accounting Principles (GAAP) of $430 million, or $3.47 per diluted share, and $1.3 billion, or $10.59 per diluted share. These results compare to fourth quarter 2019 net income of $181 million, or $1.46 per diluted share, and full year 2019 net income of $769 million, or $6.19 per diluted share.
Reported adjusted net loss for the fourth quarter and full year 2020, excluding payroll support program wage offsets, special items, and mark-to-market fuel hedging adjustments, of $316 million, or $2.55 per diluted share, and $1.3 billion, or $10.17 per diluted share. These results compare to fourth quarter 2019 adjusted net income of $181 million, or $1.46 per diluted share, and full year 2019 adjusted net income of $798 million, or $6.42 per diluted share.
Reported adjusted net debt of $1.7 billion, flat from December 2019 despite a 59% decline in operating revenues for the year.
Reported a debt-to-capitalization ratio, including certain short-term borrowings, of 61%.
Held $3.3 billion in unrestricted cash and marketable securities as of Dec. 31, 2020.
Liquidity and Fleet Updates:
Accessed approximately $5 billion in new liquidity in 2020, including $1.2 billion raised in the capital markets and approximately $600 million in bank financing.
Reached an agreement with the U.S. Treasury in January 2021 to receive an extension of payroll support totaling $533 million, $266 million of which was received on Jan. 15, 2021.
Extended the period available to draw funds under the CARES Act loan program from March 26, 2021 to May 28, 2021.
Announced plans to expand the mainline fleet and restructure the existing aircraft purchase agreement with Boeing. In total, Air Group will take delivery of 68 737-9 MAX aircraft between 2021 and 2024, inclusive of 32 previous purchase commitments and 13 aircraft to be leased from Air Lease Corporation.
Took delivery of Alaska’s first 737-9 MAX aircraft on January 24, 2021, which is expected to enter revenue service on March 1, 2021.
Permanently removed an additional 20 Airbus A320 aircraft from the fleet in the fourth quarter, resulting in 40 Airbus aircraft removed in 2020. A total of 31 Airbus aircraft remain in the operating fleet as of the end of the year.
Held $3.4 billion in cash and marketable securities as of Jan. 22, 2021, and total liquidity of $5.2 billion.
Operational and Guest Safety Updates
Announced seven new routes in the fourth quarter, including three “fun and sun” destinations connecting Anchorage to Las Vegas, Denver and San Francisco, and expanded service from Southern California to Austin and New York.
Eliminated change fees and extended the flexible travel policy for tickets purchased through March 31, 2021.
Implemented Next-Level Care initiative, which includes more than 100 measures designed to create a safe experience for guests and employees. These efforts were highlighted in the Alaska Safety Dance video.
Named the safest U.S. airline by AirlineRatings.com in their annual Top 20 Safest Airline report.
Launched the West Coast International Alliance with American Airlines on Jan. 1, 2021, which will unlock new benefits for Alaska Mileage Plan members in the spring.
Partnered with healthcare providers to offer rapid and standardized COVID-19 testing for those guests traveling to destinations that require a negative result.
Received diamond level certification from the Airline Passenger Experience Association for the health and safety standards Alaska and Horizon Air implemented to keep guests safe throughout their journey.
Launched pre-clearance program for guests traveling to the Hawaiian Islands from the West Coast with an approved negative COVID-19 test.
Announced a partnership with Microsoft to use sustainable aviation fuel to offset the environmental impact of certain business air travel.
Announced oneworld benefits for elite Mileage Plan members, providing tier status in the global alliance to Alaska’s elite members, as the company works toward joining oneworld on March 31, 2021.
Alaska Air Group Inc. (NYSE: ALK) today reported a fourth quarter 2020 GAAP net loss of $430 million, or $3.47 per diluted share, compared to net income of $181 million, or $1.46 per diluted share in 2019. Excluding the impact of payroll support program wage offsets, special items and mark-to-market fuel hedge adjustments, the company reported a fourth quarter adjusted net loss of $316 million, or $2.55 per diluted share, compared to adjusted net income of $181 million, or $1.46 per diluted share in the fourth quarter of 2019.
The company reported a full-year 2020 GAAP net loss of $1.3 billion, compared to net income of $769 million in the prior year. Excluding the impact of payroll support program wage offsets, special items and mark-to-market fuel hedge adjustments, the company reported an adjusted net loss of $1.3 billion, or $10.17 per diluted share for 2020, compared to adjusted net income of $798 million, or $6.42 per diluted share in 2019.
Mesa Air Group, Inc. (NASDAQ: MESA) today reported fourth quarter and full-year fiscal 2020 financial and operating results.
Mesa’s Q4 2020 results reflect net income of $11.4 million, or $0.32 per diluted share, compared to net income of $12.2 million, or $0.35 per diluted share for Q4 2019. Mesa Q4 2020 results include, per GAAP, the deferral of $7.8 million of revenue, all of which was billed and paid by American and United during the quarter and will be recognized over the remaining terms of the contracts. Mesa’s Adjusted EBITDA1 for Q4 2020 was $44.6 million, compared to $50.8 million in Q4 2019, and Adjusted EBITDAR1 was $54.2 million for Q4 2020, compared to $61.9 million in Q4 2019. For Q4 2020 revenue was $108.0 million, a reduction of $79.8 million (42%) from $187.8 for Q4 2019 primarily due to the reduced flying as a result of COVID-19. During the quarter Mesa recognized $40.8 million as an offset to wages and salaries related to the previously announced Payroll Support Program Agreement (“PSP”), which required Mesa to retain all of its employees.
Operationally, the Company ran a 99.8% controllable completion factor, compared to 99.0% in Q4 2019, and a total completion factor of 98.2%, which primarily includes weather, close-in capacity reductions driven by reduced demand, and other uncontrollable cancellations, compared to 96.9% in Q4 2019.
Full Year
Mesa reported net income of $27.5 million, or $0.78 per diluted share for the 2020 fiscal year, compared to net income of $47.6 million, or $1.36 per diluted share for the 2019 fiscal year. Excluding special items for both periods, adjusted net income1 was $27.5 million or $0.78 per diluted share for the 2020 fiscal year, compared to $57.5 million or $1.64 per diluted share for the 2019 fiscal year. Mesa fiscal 2020 results include, per GAAP, the deferral of $23.8 million of revenue, all of which was billed and paid by American and United during the year and will be recognized over the remaining terms of the contracts. Mesa’s Adjusted EBITDA1 was $163.3 million in fiscal year 2020, compared to $208.7 million in fiscal year 2019 and Adjusted EBITDAR was $212.1 million in fiscal year 2020, compared to $260.9 million in fiscal year 2019. For fiscal year 2020, revenue was $545.1 million, a reduction of $178.3 million (25%) from $723.4 million for fiscal year 2019, primarily due to the reduced flying as a result of COVID-19. During the year, Mesa recognized $83.8 million as an offset to wages and salaries related to the previously announced Payroll Support Program Agreement (“PSP”), which required Mesa to retain all of its employees as of April 20, 2020.
_______________ 1 See Reconciliation of non-GAAP financial measures
Fiscal 2020 Q4 Highlights
– EPS of $0.32, Full Year $0.78
– Year-end cash increased by $34.5 million to $99.4 million
Recent Updates
– Amended capacity purchase agreement with American to operate 40 CRJ-900s for a five-year term
– Commenced cargo operations for DHL with two Boeing 737-400F
– Added 10 new E175 aircraft to our United fleet in November and December
– Entered into a $195 million loan under the CARES Act with the U.S. Treasury
CHICAGO, Sept 14 (Reuters) – Delta Air Lines said on Monday it is seeking to raise $6.5 billion through new bonds and loans backed by its SkyMiles loyalty program, further bolstering liquidity to weather a drastic downturn in travel demand due to the COVID-19 pandemic.
The airline said it would use the loyalty program as collateral to secure the new loans and issuance, as it continues to burn through about $27 million in cash each day.
U.S. airlines have cut costs and raised debt to survive what they call an unprecedented industry crisis. The situation is not expected to improve until there is a meaningful recovery in demand.
With its latest financing deal, Delta will not pursue a $4.6 billion federal loan available under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, officials said, even as it continues to lobby for a second round of federal payroll grants.
Atlanta-based Delta is among U.S. airlines to have tapped funds under a $25 billion made available primarily in grants under the CARES Act to cover employees’ payroll through September, but not a separate $25 billion package in secured loans.
The loan program has attractive financing terms but restricts executive compensation and share buybacks.
The airline has said it could furlough nearly 2,000 pilots in October without more federal aid, but believes it can avoid any flight attendant furloughs through the winter thanks to strong demand for voluntary departures or leaves.
Delta had $15.7 billion in liquidity at the end of June, which it said equaled about 19 months of financial runway at a daily burn rate of $27 million.
It still has unencumbered assets worth $6 billion to $7 billion, primarily in the form of spare aircraft parts and engines, if needed, officials said.
Delta did not disclose the value of the loyalty program or the terms of the new financing, which mirrors a debt deal by United Airlines in June backed by its $20 billion MileagePlus program.
Delta’s shares, which have lost about 46% this year, closed at $31.70 on Friday.
(Reporting by Tracy Rucinski; Editing by Ana Nicolaci da Costa)
American Airlines Group Inc. (NASDAQ: AAL) will adjust its October schedule to remove service to 15 markets as a result of low demand and the expiration of the air service requirements associated with the Coronavirus Aid, Relief and Economic Security (CARES) Act. This is the first step as American continues to evaluate its network and plans for additional schedule changes in the coming weeks.
These station suspensions will be effective Oct. 7. For now, these changes are only in place for the October schedule period, which runs through Nov. 3.
The airline will continue to re-assess plans for these and other markets as an extension of the Payroll Support Program remains under deliberation. The full, updated October schedule will be released Aug. 29, and American anticipates releasing its updated November schedule by late-September.
The full list of suspensions is below and will be reflected on aa.com Aug. 29.
CHICAGO, April 15, 2020 /PRNewswire/ — Oscar Munoz, Chief Executive Officer, and J. Scott Kirby, President, today issued the following message to nearly 100,000 United Airlines (NASDAQ: UAL) employees:
To our United Family:
We hope all is well with you and your family. Two weeks ago, we hosted a virtual townhall and it was a valuable opportunity for us to connect with you all. And we’ve been really pleased with the response, more than 50,000 of you tuned in live or watched the broadcast on demand.
At the townhall, we discussed the impact of your calls and letters to Congress as they debated financial support for the airline industry. Washington heard you loud and clear, passing vital legislation that will provide commercial airlines with a total of $50 billion worth of grants and loans. We are grateful for the bipartisan cooperation displayed by leaders in the Congress and Administration — and appreciative of the critical role that you played. The thousands of letters and messages you sent, capturing the spirit of our United family and what our service means to our customers and communities, made all the difference in the world. We will need that spirit more than ever as we set our sights on the rest of 2020 and beyond.
The challenge that lies ahead for United is bigger than any we have faced in our proud 94-year history. We are committed to being as direct and as transparent as possible with you about the decisions that lay ahead and what impact they will have on our business and on you, the men and women of United Airlines.
Let’s start with the near-term. We now expect United to receive approximately $5 billion from the federal government through the Payroll Support Program under the CARES Act – to be used to protect the paychecks of our United employees. This government support does not cover our total payroll expense, but we’re keeping our promise that there will be no involuntary furloughs or pay rate cuts for U.S. employees before September 30. And, payroll only represents about 30 percent of our total costs. Fixed operating and non-payroll costs like airport rent, supplies and infrastructure are significant and not going away. That’s why we’ve been so aggressive in reducing our schedule, slashing capital expenditures, scaling back our work with vendors and consultants and cutting executive salaries in half.
We’re planning to go even further to reduce costs. This weekend, we’ll load a revamped schedule that will further reduce our capacity to about 10 percent of what had been planned for May at the beginning of this year. We expect to announce similar reductions to the June schedule in the next few weeks. We have now essentially redesigned our network to be down 90 percent while complying with the CARES Act and maintaining connectivity among nearly all our domestic destinations. And these May and June schedule reductions will have direct consequences for our frontline employees in terms of total hours worked. Those work groups can expect to hear more details from their leaders soon.
The more flexibility we have from a payroll perspective, the better. So, all work groups can expect to see a continued emphasis on payroll cost cutting options over the next few weeks including new voluntary leave offerings and voluntary separation programs. For those who are eligible, please consider signing up for voluntary COLA and ANP days. We’re grateful to the more than 20,000 employees who have already signed up. Your sacrifice is both deeply appreciated and important to our company’s future.
These schedule changes reflect the stark reality of our situation – and unfortunately, it’s something that even legislation as large as the CARES Act can’t fix. Travel demand is essentially zero and shows no sign of improving in the near-term. To help you understand how few people are flying in this environment, less than 200,000 people flew with us during the first two weeks of April this year, compared to more than 6 million during the same time in 2019, a 97 percent drop. And we expect to fly fewer people during the entire month of May than we did on a single day in May 2019.
The historically severe economic impact of this crisis means even when travel demand starts to inch back, it likely will not bounce back quickly. We believe that the health concerns about COVID-19 are likely to linger which means even when social distancing measures are relaxed, and businesses and schools start to reopen, life won’t necessarily return to normal. For example, not all states and cities are expected to re-open at the same time. Some international travel restrictions will remain in place. Meeting planners and tour operators will do their best to accommodate people looking to avoid large crowds. So, while we have not yet finalized changes to our schedule for July and August, we expect demand to remain suppressed for the remainder of 2020 and likely into next year.
So, let us end where we began, the government funding we expect to receive soon is helpful in the near-term because we can protect our employees in the U.S. from involuntary furloughs and pay rate cuts through the end of September. But the challenging economic outlook means we have some tough decisions ahead as we plan for our airline, and our overall workforce, to be smaller than it is today, starting as early as October 1.
Throughout this crisis, we have been candid and upfront with you. And today is no different. We appreciate the partnership and open dialogue we have with all of you as we confront this extraordinary situation that has had an unprecedented impact on our families and our company. We promise to continue to stay in close touch – and will continue to be as transparent as possible – in the weeks and months ahead.
Stay safe. Stay healthy. And please continue to take good care of our customers and each other. It’s because of you that we remain proud to be United Together.
WASHINGTON, April 6 (Reuters) – RavnAir Group, the largest regional carrier in Alaska, filed for bankruptcy Sunday and grounded all of its 72 planes as it waits on a decision from U.S. Treasury for government assistance.
The Trump administration is weighing applications from numerous airlines as it considers how to disburse $25 billion in passenger airline grants, $4 billion for cargo carriers and $3 billion for airport contractors. Congress approved the bailout funds to help air carriers cover payroll costs.
RavnAir, which filed for Chapter 11 bankruptcy protection in Delaware, said Sunday it was suspending all operations and laying off all employees.
“We took these actions to ensure our airline has a future, and to give us time to ‘hit pause'” while it seeks Treasury grants and “other sources of financial assistance that will allow us to weather the coronavirus pandemic and emerge successfully once it has passed.”
In a letter posted Sunday, RavnAir Chief Executive Dave Pflieger said the airline was working to “resume the vital air service you depend on to get home to your families, to your businesses, to medical appointments, and to other duties that are essential to our communities and the state of Alaska.”
Delta Air Lines Inc, American Airlines Group Inc , Spirit Airlines Inc, Southwest Airlines Co , United Airlines Holdings Inc and JetBlue Airways Corp are among the airlines that confirmed they filed before a Friday deadline set by Treasury to get speedy consideration.
On Sunday, top Democrats including House Speaker Nancy Pelosi and Senator Charles Schumer urged Treasury Secretary Steven Mnuchin to move quickly and not impose unreasonable conditions on the grants. Airline unions and many Democrats object to Treasury demanding significant equity or warrants as a condition to the grants.
(Reporting by David Shepardson; Editing by Lisa Shumaker)
I always love to read stories about the generosity of great corporations. Especially during times when self-centered politicians love to bash them so that they can profit from the potential graft a pending victory can bring. -WB
PRNewswire/ — Wynn Resorts (Nasdaq: WYNN), the world’s leading resort company based in Las Vegas, Nevada, announced today that the Company will extend paying all salaried, hourly and part-time employees through May 15, for a total of 60 days of payroll continuance. The Company decided to take this action as part of its shared responsibility for the health and safety of its employees, their families and the Las Vegas and Greater Boston communities during this pandemic.
Payroll coverage will include more than 15,000 current Wynn and Encore employees. For tipped employees, it includes the average tip compliance rate or distributed tips/tokes since the beginning of the year.
“It is our shared responsibility to follow the direction of health and safety professionals to stay home, and limit social contact,” said Wynn Resorts CEO Matt Maddox. “We owe it to each other, our families and to our community.”
For more information on Wynn’s health and safety measures, please visit www.WynnInfo.com.
The Encore Boston Harbor Casino in Everett seen from Somerville. (Jesse Costa/WBUR)
