Cash returns to shareholders: The company is on track to complete the remaining $725 million of its current $2 billion repurchase authorization by the end of June 2015, one and a half years ahead of schedule. When this authorization is completed, Delta will have returned a total of $3 billion in dividends and share repurchases since announcing its initial program two years ago. Going forward, the company intends to return at least 50 percent of free cash flow to shareholders through 2017. The new $5 billion repurchase authorization and 50 percent increase to the quarterly dividend approved by Delta's Board of Directors are expected to return more than $6 billion to shareholders through 2017.
Debt: Delta ended the March 2015 quarter with $7.4 billion of adjusted net debt, a reduction of $2.0 billion since the end of 2013 and roughly $10 billion since the company began its debt reduction efforts in 2009. The company has set a target to achieve and maintain $4 billion of adjusted net debt by year end 2017. This debt level is expected to result in annual net interest expense of ~$200 million, a $1.1 billion reduction compared to 2009.
Pension: Since 2009, Delta has increased its pension plan assets by $1.7 billion, net of $5.2 billion in distributions, through a combination of contributions and asset returns. The company plans to maintain its current $1 billion annual funding level through 2020, with a goal of achieving 80 percent funded status by that date. Delta made a one-time additional $200 million contribution in 2015, for a total contribution of $1.2 billion for the year, to keep the company on track to achieve its 2020 target.
Planning for a net interest expense of "only" ~$200 million a few years down the road is a pretty impressive target, and a nice achievement once that happens.
