Delta Air Lines, Inc. · NYSE:DAL
Delta Air Lines — Deutsche Bank 2013 Global Industrials and Basic Materials Conference
17 slides from Delta Air Lines's conference presentation, Jun 13, 2013
Slide 1: Delta: Building A Better Airline
Delta: Building A Better Airline Deutsche Bank 2013 Global Industrials and Basic Materials Conference June 13, 2013
Slide 2: Safe Harbor
This presentation contains various projections and other forward - looking statements which represent Delta’s estimates or expectations regarding future events. All forward - looking statements involve a number of assumptions, risks and uncertainties, many of which are beyond Delta’s control, that c
Slide 3: Building A Better Airline
Building A Better Airline • Expect record June quarter following first March quarter profit in over a decade • Building on 2012’s financial momentum to grow earnings and expand margins in 2013 and beyond • Investing in network, operations, product and people to drive sustainable revenue growth, corp
Slide 4: A Path of Significant Improvement
A Path of Significant Improvement Delta’s financial foundation has strengthened considerably over the past five years, with a solid pipeline of initiatives in place for further improvement $1.4B $2.8B 2009 2012 1.5% 11.3% 2009 2012 $17.0B $ 11.0B 2009 1Q13 Operating Cash Flow Return on Invested Capi
Slide 5: Momentum Continues In 2013
Momentum Continues In 2013 2Q13 Operating margin 10% - 11% Fuel price, including taxes and settled hedges $3.00 - $3.05 Free cash flow ~$850 million 2Q13 vs. 2Q12 Consolidated ex - fuel unit cost Up 3% - 4% System capacity Flat to up 1% 5 Note: Fuel price excludes mark - to - market adjustments; con
Slide 6: Consolidation Producing Financial Stability
Consolidation Producing Financial Stability 2002 Now Major Airlines 9 4 Total revenues $75 billion $120 billion Net income ($10) billion $6 billion Leverage ratio 7.0 x 4.5x 6
Slide 7: Airlines Have More Runway Ahead
1,212 422 Deliveries 1999 - 2002 Scheduled Deliveries 2013 - 2016 Airlines Have More Runway Ahead Mainline Aircraft Deliveries for Major U.S. Carriers $30+ billion capital …with a much different forward outlook on capacity and capital The industry is approaching similar levels of profitability… Mult
Slide 8: Delta Is Taking a Different Approach
Delta Is Taking a Different Approach All stakeholders need to share in our success to break the industry’s historical pattern 8 Employees • Best employee relations in the industry Customers • Continued benefits from investments in product, service, technology and operations Shareholders • 4 th conse
Slide 9: Investing in the Business and Operational Reliability
Investing in the Business …and Operational Reliability 9 Investing in Network, Product and Facilities….. • Onboard: – Launch of Economy Comfort – Flat bed seats on 85% of international aircraft by end of 2013 – Wi - Fi on all two - class aircraft – Personal on - demand entertainment • Facilities: –
Slide 10: Generating a Revenue Premium To The Industry
14.5 % 13% 13% 11% 6% 8% 4.5 % 4% 0.5% 5.5 % 2.5% 4% 5.5% 5% 2% - 2% 0 .5% 9% 5% 7% 8% 4% 5% 2% 1% - 1% 2% - 1% 1% 2.5% 3% 3% - 4% - 1% Jan-12 Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan-13 Feb Mar Apr May Delta A4A Excl DAL Generating a Revenue Premium To The Industry Delta has a network, produ
Slide 11: Initiatives to Maximize Revenue Premium
Initiatives to Maximize Revenue Premium • Acquiring 49% stake provides unique opportunity to increase Heathrow presence • London - Heathrow is the largest international destination for corporate travel • Network, operations, and product improvements already generating substantial increases in both c
Slide 12: Cost Control Key To Margin Expansion
1H13 2H13 Longer term Cost Control Key To Margin Expansion $1 billion structural cost initiatives designed to stabilize cost trends and pave the way for margin expansion in 2013 and beyond • Non - fuel unit costs expected to grow 3 - 5% for 2013 • Cost growth peaks in 1Q13 and stabilizes by year end
Slide 13: Managing Fuel Expense to Reduce Risk
Taking a unique approach to Delta’s number one input cost • Trainer Refinery is a unique approach to addressing Delta’s $12 billion annual fuel spend • Agreements in place for 10% of refinery’s crude supply to come from Bakken in second half of 2013 − Allows Delta, not the refiners, to benefit from
Slide 14: Capital Discipline Drives Free Cash Flow
Capital Discipline Drives Free Cash Flow Capital Spending and Operating Cash Flow ($ Billion) Note: Includes pre - merger NWA Delta’s business model produces both solid financial results and significant free cash flow 1998 – 2000 Cumulative earnings: $6.5 billion Cumulative free cash flow: ($2.0 bil
Slide 15: Plan For Free Cash Flow Deployment
Plan For Free Cash Flow Deployment Delta’s long - term financial plan calls for significant free cash flow, and creation of up to $5 billion in value for shareholders through a combination of further debt reduction, capital return to shareholders and opportunistic pension funding 15 Debt Reduction R
Slide 16: Building A Better Airline
Building A Better Airline • Expect record June quarter following first March quarter profit in over a decade • Building on 2012’s financial momentum to grow earnings and expand margins in 2013 and beyond • Investing in network, operations, product and people to drive sustainable revenue growth, corp
Slide 17: EXPERIENCE |
EXPERIENCE | FOR A STR! TAILWIN
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