Delta Air Lines announces March quarter profit

Delta Air Lines (NYSE: DAL) today reported financial results for the March 2014 quarter. Key points include:

Delta’s pre-tax income for the March 2014 quarter was $444 million, excluding special items1, an increase of $363 million over the March 2013 quarter on a similar basis.

Delta’s net income for the March 2014 quarter was $281 million, or $0.33 per diluted share, excluding special items1. This is $196 million higher year over year despite $163 million of non-cash tax expense now recognized after the reversal of the company’s valuation allowance.
On a GAAP basis including special items, Delta’s pre-tax income was $335 million and net income was $213 million, or $0.25 per diluted share.
Delta cancelled more than 17,000 flights due to severe weather in January and February, double the number of flights cancelled for weather in 2013. These cancellations resulted in $90 million of lost revenue and $55 million lower pre-tax income.
Results include $99 million in profit sharing expense in recognition of Delta employees’ contributions toward achieving the company’s financial goals.
Delta generated $951 million of operating cash flow and $390 million of free cash flow in the March 2014 quarter. This strong cash generation allowed the company to reduce its adjusted net debt to $9.1 billion, contribute more than $600 million of funding to its defined benefit pension plans, and return $176 million to shareholders through dividends and share repurchases.