Investor Presentaiton
Non-GAAP Reconciliations
Free Cash Flow. We present free cash flow because management believes this metric is helpful to investors to evaluate the company's ability to generate cash that is available
for use for debt service or general corporate initiatives. Free cash flow is defined as net cash from operating activities and net cash from investing activities, adjusted for (i) net
purchases/(redemptions) of short-term investments, (ii) strategic investments and related, (iii) net cash flows related to certain airport construction projects and other, (iv)
hedge margin and (v) pension plan contribution. These adjustments are made for the following reasons:
Net purchases/(redemptions) of short-term investments. Net redemptions of short-term investments represent the net purchase and sale activity of investments and
marketable securities in the period, including gains and losses. We adjust for this activity to provide investors a better understanding of the company's free cash flow
generated by our operations.
Strategic investments and related. Cash flows related to our investments in and related transactions with other airlines are included in our GAAP investing activities. We
adjust for this activity because it provides a more meaningful comparison to our airline industry peers.
Net cash flows related to certain airport construction projects and other. Cash flows related to certain airport construction projects are included in our GAAP operating
activities and capital expenditures. We have adjusted for these items, which were primarily funded by cash restricted for airport construction, to provide investors a better
understanding of the company's free cash flow and capital expenditures that are core to our operations in the periods shown.
Hedge margin. Free cash flow is adjusted for hedge margin as we believe this adjustment removes the impact of market volatility on our unsettled hedges and allows
investors to better understand and analyze the company's core operational performance in the periods shown.
Pension plan contribution. In 2017, we contributed $2 billion to our pension plans using net proceeds from our debt issuance. We adjust to exclude this contribution to
allow investors to understand the cash flows related to our core operations in the periods shown.
(in billions)
Net cash provided by operating activties:
Net cash provided by investing activties:
Adjusted for:
Net purchases/(redemptions) of short-term investments
Strategic investments and related
Net cash flows related to certain airport construction projects and other
Hedge margin
Pension plan contribution
Free cash flow
Number of years
Average free cash flow
Year Ended
December 31, 2009
2010 - 2014
Total
2015-2019
Total
$
1.4
$
17.6
$
35.7
(1.0)
(10.7)
(20.4)
(0.3)
1.3
(1.2)
0.4
2.2
0.7
0.7
0.9
(0.9)
2.0
0.1
$
10.2
$
18.0
5
5
$
2.1
$
3.6
22
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