At a time when most of the organizations are chasing higher sales and more profits, Delta Air Lines, Inc. (NYSE:DAL) has decided to give away 1% of its net income to charitable organizations.
Not long ago, company’s Chief Executive Officer, Ed Bastian, wrote an open letter to all the employees, stating his vision and Delta’s board’s decision to donate around $37 million profit to a vast number of charity organizations around the globe. The initiative will begin from this year itself.
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While addressing to shareholders, Bastian said that Delta Airlines had one of the best 12 month periods in 2015 in terms of business growth and revenue realization. According to him, this is the perfect timing to return a share of company’s profit to those communities that are home to many people. Company’s net income in 2015 was $4.5 billion, six times higher than previous year’s net income of $659 million. The primary driving force behind this record breaking growth rate was its excellent performance in 4Q2015 and reduction worth $726 million in fuel expense.
The donation would be made through grants, in-kind travel, and cash contributions; however, Delta Airlines is yet to disclose the names of all the charity organizations that will receive this financial help. A report claims that it’s considering those charity agencies that are working in areas like arts, education, culture, environment, and military.
Although the letter written by Bastian suggests that this practice will continue in the coming years as well, a lot will depend on how the company performs in 2016. The declining oil prices have benefitted Delta, but the rising competition has increased its problems. Going forward, it may have to come up with innovative ideas to deal with profits, per-seat margin, and net income related issues. Details of such initiatives will be announced at a later date.
