Delta distributes $1.5 billion in profits to employees

Delta Air Lines distributed $1.5 billion in profit-sharing checks to employees Friday, including an average of $16,000 per person to its workers in the Twin Cities.

The payout was the largest in the airline's history, resulting from a record $4.5 billion in profit last year.

Individual payouts varied widely because the profit-sharing checks are equal to about 21 percent of the each employee's annual base pay.

Delta, the dominant carrier at Minneapolis-St. Paul International Airport, employs more than 7,500 in the Twin Cities area and about 80,000 people globally.

This is the sixth consecutive year that Delta has distributed profits to employees. Last year, its employees received 16 percent of their annual pay.

The distribution came a day after Moody's Investors Services raised Delta's credit rating to Baa3, the lowest investment grade. It's the first U.S.-based legacy carrier to have its rating restored to this level. Competitors American and United airlines still have junk-grade ratings.

In its announcement, Moody's said it does not believe other airlines have reduced their debt burden like Delta and that it is the only legacy carrier likely to sustain its current strong credit metrics "without the benefit of low fuel prices, especially in an environment likely to have fare, as well as labor, cost pressures."

Discount carrier Southwest Airlines and Alaska Airlines also have investment-grade credit ratings.

Delta has reduced its debt by more than $10 billion since 2009, when the carrier merged with former Eagan-based Northwest Airlines. In the rating agency's announcement, Moody's senior credit officer Jonathan Root cited disciplined debt reduction, targeted return on invested capital, use of free cash flow to repurchase shares and a contribution of $1 billion annually to its frozen pension plans as reasons for credit confidence in Delta.

Kristen Leigh Painter • 612-673-4767