Delta Air Lines, Inc. · NYSE:DAL
Delta Air Lines — Cowen and Company 11th Annual Global Transportation Conference (September 2018)
14 slides from Delta Air Lines's conference presentation, Sep 5, 2018
Slide 1: Delta: Built to Last
Delta: Built to Last Cowen and Company 11th Annual Global Transportation Conference September 5, 2018
Slide 2: Safe Harbor
Safe Harbor Statements in this presentation 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
Slide 3: Delta has the Right Combination of Strategic Advantages
Delta has the Right Combination of Strategic Advantages Foundation in place for long-term success Culture Domestic Network Investment Grade Balance Sheet At the core of Delta – Best connecting hub Solid foundation with lower passionate and determined complex – including the interest expense, more ca
Slide 4: Delta Delivers Again in 2017
Delta Delivers Again Our Advantages in 2017 Create Consistency and Durability A durable business model focused on customer service and reliability with sustainable financial results Running a reliable, customer-focused airline is Producing Consistent producing strong profits and cash flows that are
Slide 5: Delta Delivers Producing Again in 2017
Delta DeliversProducing Consistently Again in 2017 Solid Results Running a reliable, customer-focused airline is producing strong profits and cash flows, allowing for improved balance sheet strength and increased return of capital to shareholders Pre-Tax Profit Operating Cash Flow Returns to Shareho
Slide 6: Margins Stabilizing in Second Half of 2018
Margins Stabilizing in Second Half of 2018 Strong revenue momentum, improving non-fuel costs, and moderating fuel price increases position Delta to return to margin expansion by year-end Year-over-Year Change • Reaffirming earnings per share guidance of in Pre-Tax Margin $1.65 to $1.85 for the Septe
Slide 7: Investments in Customer Experience and Operational Reliability Driving Diversified Revenue Premium
Investments in Customer Experience and Operational Reliability Driving Diversified Revenue Premium • Delta’s strong customer focus combined with investments in our fleet, network, product, and airline partners have driven revenue diversity and a significant, sustainable revenue premium to the indust
Slide 8: Driving Efficiency to Address Non-Fuel Cost Growth
Driving Efficiency to Address Non-Fuel Cost Growth Continue to expect full year growth of 1 to 2% • With fuel pressuring margins, managing controllable Year-over-Year costs is more important than ever Non-Fuel Unit Cost Growth • Second half 2018 non-fuel unit cost growth expected to be 3 to 4 points
Slide 9: Continuing Balanced Capital Allocation in 2018
Continuing Balanced Capital Allocation in 2018 Balancing cash flows between investment in business, balance sheet and shareholders Reinvest In The Business • Capital spending targets ~50% of operating cash flow • Replacing ~30% of mainline fleet from 2017-2020, driving enhanced efficiency • Provides
Slide 10: Committed to Consistent Shareholder Returns
Committed to Consistent Shareholder Returns Target returning ~70% of free cash flow to owners Annual Dividend • Since 2013, Delta has returned more than $11 billion through dividends and share repurchases $950M • 2018 marks 5th consecutive annual dividend increase $875M – Dividend yield ~2.4% at cur
Slide 11: Non-GAAP Reconciliations
Non-GAAP Reconciliations Non-GAAP Financial Measures 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"
Slide 12: Non-GAAP Reconciliations
Non-GAAP Reconciliations Operating Cash Flow, adjusted We adjusted operating cash flow because management believes this metric is helpful to investors to evaluate the company's ability to generate cash that is available for use for capital expenditures, debt service or general corporate initiatives.
Slide 13: Non-GAAP Reconciliations
Non-GAAP Reconciliations Pre-tax Margin, Adjusted We adjust pre-tax margin for MTM adjustments and settlements and equity investment MTM adjustments for the same reasons described under the heading pre-tax profit, adjusted. We then adjust for third-party refinery sales and unrealized gain/loss on in
Slide 14: Non-GAAP Reconciliations
Non-GAAP Reconciliations Non-Fuel Unit Cost or Cost per Available Seat Mile (“CASM-Ex”) We 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 pe