The ratings agency said it expects Delta, which also uses its passenger planes to move a large amount of cargo, to have $400 million in negative free cash flow in 2009 as operating results deteriorate in the second half of the year. It rated various debts in the 'B-' to 'BB' range. Delta has $5 billion in cash and other liquid assets that provides a larger buffer than other carriers to meet operating and financing obligations. But it will be difficult for the airline to maintain reserve levels and pay $5 billion in notes that are scheduled to mature between now and the end of 2011 without improved access to credit markets to refinance loans and better airline industry economics next year, Fitch said. Delta also has cost advantages over other air carriers due to its recent restructuring and emergence from bankruptcy in 2007.
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Delta's revenue in May was also impacted by the H1N1 flu scare that impacted bookings in Mexico and Asia. Fitch said Delta could lose $250 million in sales this year because of traveler concerns about the pandemic.
Fitch said Delta needs cash reserves of at least $4 billion to meet its debt maturities of more than $2.9 billion in 2010, but there are recent signs that banks are more willing to refinance loans for better capitalized airlines. Also on the positive side, Delta has financing in place for near-term aircraft orders and has few aircraft capital commitments in 2010. Delta is also unwinding some fuel hedging contracts that cost it extra money as fuel prices remain below last year's record highs. ' Eric Kulisch
Brokerage Compliance Symposium
The day before F3. Every compliance issue you face - fraud exposure, carrier liability, FMCSA rules, cargo theft, insurance gaps - navigated by attorneys and operators defining best practices in a changing industry.
F3 Awards Dinner
The night before F3. FreightTech100 companies honored. FreightTech 25 and Shipper of Choice winners revealed live. Cocktail reception into dinner and live music - 300 industry leaders in one purpose-built room.
F3: Future of Freight Festival
Industry-defining keynotes, rapid-fire technology demos, and industry leaders networking in experiences across Chattanooga - plus the inaugural F3 Awards Dinner featuring the FreightTech and Shipper of Choice reveals.
The day before F3. Every compliance issue you face - fraud exposure, carrier liability, FMCSA rules, cargo theft, insurance gaps - navigated by attorneys and operators defining best practices in a changing industry.
The Signal at Chattanooga Choo Choo • Chattanooga, TN Register NowThe night before F3. FreightTech100 companies honored. FreightTech 25 and Shipper of Choice winners revealed live. Cocktail reception into dinner and live music - 300 industry leaders in one purpose-built room.
The Signal at Chattanooga Choo Choo • Chattanooga, TN Register NowIndustry-defining keynotes, rapid-fire technology demos, and industry leaders networking in experiences across Chattanooga - plus the inaugural F3 Awards Dinner featuring the FreightTech and Shipper of Choice reveals.
The Signal at Chattanooga Choo Choo • Chattanooga, TN Register Now


