Delta Air Lines, Inc. (NYSE:DAL) Q1 2019 Earnings Conference Call Transcript

Apr 10, 2019 • 10:00 am ET


Delta Air Lines, Inc. (NYSE:DAL) Q1 2019 Earnings Conference Call Transcript


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Paul Jacobson

and remain staunchly committed to returning 70% of free cash flow to shareholders annually. In the first week of April, we contributed $250 million of our voluntary pension funding for the year, and we expect to contribute the remaining $250 million later this year. Leveraging our strong balance sheet, we recently refinanced $500 million of scheduled debt maturities. The completion of our $500 million EETC refinances approximately one-third of our 2019 scheduled maturities at a 3.2% blended rate saving us approximately $9 million annually on our interest expense. With debt levels comfortably within our leverage ratio target of 1.5 times to 2.5 times adjusted debt-to-EBITDAR, we will continue to utilize a variety of funding sources to refinance debt maturities or take advantage of market conditions and refinance higher cost debt.

Our after-tax return on invested capital on a trailing 12-month basis is 14.5%. This is up nearly 200 basis points over prior year on improved profitability and tax reform benefits. We are on track to deliver a 15% after-tax ROIC in 2019, consistent with our expectations at Investor Day. Looking forward, we have solid momentum and are on track to deliver strong top line growth, margin expansion and double-digit EPS growth for the full year. This performance is a validation of our commitment to reinforcing the Delta difference. The combination of our powerful brand and our unmatched competitive advantages continue to deliver industry-leading results and will drive long-term value for our owners.

With that, I'll turn the call back over to Jill to begin the Q&A.

Jill Greer

Thanks, Paul. Jake, we're ready for questions from the analysts, if you could give them instructions on how to get in the queue.