A Delta Air Lines plane lands at Los Angeles International Airport
Mario Tama | Getty Images
Delta Air Lines halved its cash burn in the fourth quarter and expects to be profitable this summer, an upbeat forecast after the coronavirus pandemic drove the airline to its worst year ever.
Delta posted a net loss of nearly $12.39 billion in 2020 — a record and the Atlanta-based airline’s first annual loss since 2009.
Delta swung to a $755 million net loss in the fourth quarter compared with a $1.1 billion profit a year earlier. Total revenue fell 65% from $11.44 billion in the fourth quarter of 2019 to $3.97 billion. The company’s revenue got a $441 million boost from third-party refinery sales. On an adjusted basis, Delta had a per-share loss of $2.53, compared with analyst estimates for a loss of $2.50 a share.
But the airline’s losses and cash burn are on the decline and the start of vaccine distribution has sparked optimism that travelers will return to the skies in coming months.
Delta shares were up 3.9% in afternoon trading, outpacing the broader market.
The carrier’s cash burn averaged $12 million a day in the quarter ended Dec. 31, down by half from its average cash burn of $24 million a day in the third quarter.
The airline will face difficult months ahead but is eyeing a recovery in 2021 as Covid vaccines are administered around the country, CEO Ed Bastian said.
“While our challenges continue in 2021, I am optimistic this will be a year of recovery and a turning point that results in an even stronger Delta returning to revenue growth, profitability and free cash generation,” Bastian said.