EX-12.1 7 dal12312011ex121.htm EXHIBIT 12.1 DAL 12.31.2011 EX 12.1


Exhibit 12.1

Delta Air Lines, Inc.
Computation of Ratio of Earnings to Fixed Charges
 
Successor(1)
 
 
Predecessor(1)
 
Year Ended December 31,
Eight Months Ended December 31,
 
 
Four Months Ended
April 30,
(in millions, except for ratio data)
2011(2)
2010(3)
2009(4)
2008(5)
2007
 
 
2007(6)
Earnings (loss) before income taxes
769

608

(1,581
)
(9,041
)
525

 
 
1,294

Add (deduct):
 
 
 
 
 
 
 
 
Fixed charges from below
1,202

1,315

1,416

805

432

 
 
285

Capitalized interest
(9
)
(6
)
(12
)
(23
)
(8
)
 
 
(3
)
Earnings (loss) as adjusted
$
1,962

$
1,917

$
(177
)
$
(8,259
)
$
949

 
 
$
1,576

 
 
 
 
 
 
 
 
 
Fixed charges:
 
 
 
 
 
 
 
 
Interest expense, including capitalized amounts and amortization of debt costs
1,122

1,226

1,290

728

398

 
 
265

Portion of rental expense representative of the interest factor
80

89

126

77

34

 
 
20

Fixed charges
1,202

1,315

1,416

805

432

 
 
285

 
 
 
 
 
 
 
 
 
Ratio of earnings to fixed charges(7)
1.63
1.46

(0.13
)
(10.26
)
2.20

 
 
5.53


(1) 
References to “Successor” refer to Delta on or after May 1, 2007, after giving effect to (1) the cancellation of Delta common stock issued prior to the effective date of Delta's emergence from bankruptcy on April 30, 2007; (2) the issuance of new Delta common stock and certain debt securities in accordance with Delta's Joint Plan of Reorganization; and (3) the application of fresh start reporting. References to “Predecessor” refer to Delta prior to May 1, 2007.
(2) 
Includes (a) $242 million in restructuring and other items primarily related to (i) severance costs associated with voluntary workforce reduction programs offered to align staffing with planned capacity reductions and (ii) charges related to our facilities consolidation and fleet assessments and (b) $68 million due to a loss on extinguishment of debt. Additionally, interest expense includes $193 million in net debt discount amortization primarily as a result of adjusting our debt and capital lease obligations to fair value in purchase accounting upon our merger with Northwest.
(3) 
Includes (a) $450 million in restructuring and other items primarily associated with (i) Northwest and the integration of Northwest operations into Delta and (ii) asset impairment charges related to the initiative to substantially reduce our 50-seat aircraft fleet and retired dedicated freighter aircraft and (b) $401 million primarily due to a loss on extinguishment of debt. Additionally, interest expense includes $216 million in net debt discount amortization primarily as a result of adjusting our debt and capital lease obligations to fair value in purchase accounting upon our merger with Northwest.
(4) 
Includes (a) $407 million in restructuring and other items associated with (i) Northwest and the integration of Northwest operations into Delta and (ii) severance and related costs, and (b)$83 million due to a loss on extinguishment of debt. Additionally, interest expense includes $370 million in net debt discount amortization primarily as a result of adjusting our debt and capital lease obligations to fair value in purchase accounting upon our merger with Northwest.
(5) 
Includes (a) $7.3 billion non-cash charge from an impairment of goodwill and other intangible assets and (b) $1.1 billion in primarily non-cash merger-related charges relating to the issuance or vesting of employee equity awards in connection with our merger with Northwest.
(6) 
Includes a $1.2 billion non-cash gain for reorganization items.
(7) 
For the years ended December 31, 2009 and 2008, earnings were not sufficient to cover fixed charges by $1.6 billion and $9.1 billion, respectively.