• Joe Breitfeller

Delta Air Lines Announces 2019 Pre-Tax Income of $6.2B on Record Annual Revenue of $47B

On Tuesday, Delta Air Lines reported their 2019 fourth quarter and full year financial results. In the fourth quarter, the airline reported a pre-tax income of $1.4B, net income of $1.1B and a diluted EPS of $1.71. Full year adjusted EPS was up 30% to $7.31.

Delta Air Lines Reports Q4 and Full Year 2019 Earnings - Courtesy Delta Air Lines

Today, Delta Air Lines announced their fourth quarter and full year financial results. The carrier ended the year strong with a Q4 net income of $1.1B and EPS of $1.71 on revenue of $11.4B. Total Revenue per available seat mile (TRASM) increased 2.4% during the fourth quarter on strong holiday demand and cost per available seat mile excluding fuel (CASM-ex) increased 4.4%, in line with company expectations. For the full year, Delta reported a pre-tax income of $6.2B, net income of $4.8B and a diluted EPS of $7.31 (up 30% year-over-year) on a record $47B in revenue. Full year CASM-ex increased 2% year-over-year, in line with company guidance. For the full year, Delta Air Lines had $8.4B in operating cash flow and $4.2B in free cash flow. The company will also distribute a record $1.6B in profit sharing to employees payable on February 14, 2020. In today’s report, Delta's CEO, Ed Bastian said,

“2019 was a truly outstanding year on all fronts – the best in Delta’s history operationally, financially and for our customers. Our people, and their commitment to bringing best-in-class travel experiences to our 200 million customers, are the foundation for our success. I’m pleased to recognize their outstanding performance with a record $1.6 billion in profit sharing for 2019. As we enter 2020, demand for travel is healthy and our brand preference is growing, positioning Delta to deliver another year of strong results, including earnings per share of $6.75 to $7.75.”

Delta Air Lines Q4 and Full Year Earnings - Courtesy Delta Air Lines

Delta Air Lines full year revenue increased 7.7% YoY to $47B when adjusted for third-party refinery sales and the sale of Delta Global Services (DGS). During Q4, operating revenue improved 7.2% to $11.4B, primarily driven by a 9% increase in premium ticket revenue, an 18% increase in loyalty revenue and a 31% improvement in third-part maintenance revenue. These results were partially offset by a 13% decline in cargo revenue. Also commenting in Tuesday’s financial report, Delta’s President, Glen Hauenstein added,

Delta Air Lines Q1 2020 Forecast - Courtesy Delta Air Lines

“Our industry-leading operational performance and the unmatched service our people provide are the reasons why more customers than ever are choosing to fly Delta. Investments in reliability, product and service, airports and technology are reshaping customer perception and driving record satisfaction scores and increasing brand preference. We delivered $47 billion in revenue in 2019, a more than $3 billion increase when adjusted over prior year, while sustaining a revenue premium to the industry of more than 110%. Demand trends remain healthy and we expect the momentum to continue in 2020, with revenue growth of 5% to 7% in the March Quarter.”

In 2019, Delta Air Lines invested $4.5B in the business which supported the delivery of 88 new aircraft. In Q4, the company returned $484M to shareholders with $225M in share repurchases and $259M in dividends. During Tuesday morning trading, Delta Air Lines (NYSE: DAL) shares were trading up 3.4% at $61.48/share (10:31AM EDT).

Source: Delta Air Lines