Delta Airlines 2006 Annual Report Download - page 41

Our 2006 cash flows from operating activities also includes a $116 million decrease in our restricted cash balance primarily due to a release of cash
from restricted to operating as a result of agreements we reached with certain vendors. In 2005, our restricted cash balance increased significantly primarily
due to cash holdbacks associated with our Visa/MasterCard credit card processing agreement. For the year ended December 31, 2006, we classified changes
to our restricted cash balances primarily associated with credit card holdbacks to cash flows from operating activities to better reflect the nature of restricted
cash activities. Prior to 2006, we presented such changes as an investing activity. For additional information regarding this reclassification, see Note 2 of the
Notes to the Consolidated Financial Statements.
Cash flows from investing activities
Cash used in investing activities totaled $361 million for the year ended December 31, 2006, compared to cash provided by investing activities of $22
million for the year ended December 31, 2005. This change reflects a $401 million decrease in cash used for the purchase of flight and ground equipment in
2006. Our 2005 cash flows from investing activities also includes $842 million in proceeds from our sale of ASA and certain flight equipment.
Cash provided by investing activities totaled $22 million for the year ended December 31, 2005, compared to cash used in investing activities of $320
million for the year ended December 31, 2004. This change reflects $570 million of flight equipment additions in 2005, including $417 million we paid to
purchase 11 B-737-800 aircraft that we sold to a third party immediately after these aircraft were delivered to us by the manufacturer. Our 2005 cash flows
from investing activities also include $842 million in proceeds from our sale of ASA and certain flight equipment discussed above.
Cash flows from financing activities
Cash used in financing activities totaled $606 million for the year ended December 31, 2006, compared to cash provided by financing activities of $830
million for the year ended December 31, 2005. This change is primarily due to the net proceeds we received under our Secured Super-Priority Debtor-In-
Possession Credit Agreement (the “DIP Credit Facility”) shortly after our Chapter 11 filing in 2005. As a result of our Chapter 11 filing, we ceased making
payments on our unsecured debt. For additional information regarding our Chapter 11 proceedings and long-term debt, see Notes 1 and 6, respectively, of the
Notes to the Consolidated Financial Statements.
Cash provided by financing activities totaled $830 million and $636 million for the years ended December 31, 2005 and 2004, respectively. This change
is primarily attributable to the net proceeds we received under our DIP Credit Facility as discussed above compared to the net proceeds we received in 2004 in
connection with newly entered or amended financing arrangements in the aggregate amount of $1.8 billion and the issuance of 2⅞% Convertible Senior Notes
due 2024 in the amount of $325 million. As discussed above, after filing for bankruptcy, we ceased making payments on our unsecured debt.
Contractual Obligations
The following table summarizes our contractual obligations as of December 31, 2006 that relate to debt; operating leases; aircraft order commitments;
capital leases; contract carrier obligations; other material, noncancelable purchase obligations; and other liabilities. We are in the process of evaluating our
executory contracts in order to determine which contracts will be assumed in our Chapter 11 proceedings. Therefore, obligations as currently quantified in the
table below and in the text immediately following the footnotes to the table will continue to change. The table below does not include contracts that we have
successfully rejected through our Chapter 11 proceedings. The table also does not include commitments that are contingent on events or other factors that are
uncertain or unknown at this time, some of which are discussed in footnotes to this table and in the text immediately following the footnotes.
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