Q1 22 Result: Delta Air liquidity rises to $12.8 billion, generates $1.8 billion operating cash flow

One of the biggest airlines in the world, Delta Air Lines today reported financial results for the March quarter of 2022 and provided its outlook for the June quarter of 2022.

“With a strong rebound in demand as omicron faded, we returned to profitability in the month of March, producing a solid adjusted operating margin of almost 10%. As our brand preference and demand momentum grows, we are successfully recapturing higher fuel prices, driving our outlook for a 12% to 14% adjusted operating margin and strong free cash flow in the June quarter,” said Ed Bastian, Delta’s Chief Executive Officer.

“I would like to thank the Delta people, who once again enabled our best-in-class operational performance, provided an unmatched customer experience, and continue to power our industry leadership each and every day.”

The carrier adjusted operating loss of $793 million excludes a net gain of $9 million in its March quarter 2022 Financial Results.

For the same period, pre-tax loss of $1.2 billion with an adjusted pre-tax loss of $1.0 billion, excluding a net expense of $164 million.

Total operating expense of $10.1 billion increased by $679 million compared to the March quarter of 2019.

The carrier generated $1.8 billion of operating cash flow and $197 million of free cash flow, after investing $1.6 billion into the business, primarily related to aircraft purchases and modifications.

At the end of the March quarter, the company had $12.8 billion in liquidity, including cash and cash equivalents, short-term investments, and undrawn revolving credit facilities.

Looking forward, the airline said it is committed to its aspiration and strategies regarding beliefs, intentions, projections, and goals for the future.

It noted that 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, goals, aspirations, commitments, and strategies reflected in or suggested by the forward-looking statements.

“These risks and uncertainties include, but are not limited to, the material adverse effect that the COVID-19 pandemic has had on our business; the impact of incurring significant debt in response to the pandemic; failure to comply with the financial and other covenants in our financing agreements; the possible effects of accidents involving our aircraft or aircraft of our airline partners; breaches or lapses in the security of technology systems on which we rely; disruptions in our information technology infrastructure”.

“Our dependence on technology in our operations; our commercial relationships with airlines in other parts of the world and the investments we have in certain of those airlines; the effects of a significant disruption in the operations or performance of third parties on which we rely; failure to realize the full value of intangible or long-lived assets; labor issues; the effects of weather, natural disasters, and seasonality on our business; 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 carrier further stated that 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, 2021”.

“Caution should be taken not to place undue reliance on our forward-looking statements, which represent our views only as of the date of this press release, and which we undertake no obligation to update except to the extent required by law”.

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Wole Shadare