Good morning, ladies and gentlemen, and welcome to the Delta Air Lines December 2012 Quarter Financial Results Conference Call. My name is Kyle and I will be your coordinator. At this time, all participants are in a listen-only mode until we conduct a question-and-answer session following the presentation. I would now like to turn the conference over to Ms. Jill Greer. Go ahead, ma’am.

Thanks, Kyle. Good morning, everyone, and thanks for joining us for the December quarter call. Joining us from Atlanta today are Delta’s CEO, Richard Anderson; our President, Ed Bastian; and our Chief Financial Officer, Paul Jacobson. We also have the entire leadership team here in the room for the Q&A session. Richard will open the call, Ed will then address our financial and revenue performance, and Paul will conclude with a review of cost performance and liquidity. To get in as many questions as possible during the Q&A, please limit yourself to one question and a brief follow-up. Today’s discussion contains forward-looking statements that represent our beliefs or expectations about future events. All forward-looking statements involve risks and uncertainties that could cause the actual results to differ materially from the forward-looking statements. Some of the factors that may cause such differences are described in Delta’s SEC filings. We will discuss non-GAAP financial measures. All results exclude special items unless otherwise noted and you can find the reconciliation of our non-GAAP measures on the Investor Relations page at delta.com. And with that, I will turn it over to Richard.

Thank you, Jill. Good morning, everyone and thank you for joining us on this call. This morning, we cap off a successful 2012 by announcing a $238 million profit for the December quarter or $0.28 per share in line with first call consensus. Delta generated a 5.5% operating margin and unit revenues grew by 4%. For the full year 2012, we grew our net income by 30% year-on-year to $1.6 billion, expanded our pre-tax margins by 100 basis points, reduced our net debt by over $1 billion, and produced an 11% return on invested capital. Our unit revenues for the year grew 7% and we have now generated a unit revenue premium to the industry for the last two years. These results would not have been possible without the hard work and dedication of the entire Delta team, and I would like to thank them for all of their efforts on behalf of our customers in our company and our shareowners in the past year. I look forward to being with them and recognizing them on Valentine’s Day this year with a $372 million profit-sharing payout which will equal 6.67% of base pay for our frontline employees. We entered 2013 as a stronger airline entering our fourth consecutive year of good profitability and free cash flow. Through a variety of initiatives, we discussed with you at our Investor Day in December, we will build on the success we enjoyed in 2012 by posting even better operating and financial results in 2013 as we execute on our commitment to sustainable and growing profitability for our investors. For our customers, we will again make targeted investments in our operations, products and facilities and couple that with consistent execution to make Delta the preferred airline in the world. Last year, we made significant…

Thanks Richard. Good morning everyone. We appreciate you taking time to join us this morning. This morning we announced the December quarter profit of $238 million or $0.28 per share excluding special items. This was one penny ahead of where consensus had us for the quarter. During the quarter we had $231 million in charges from special items which included $122 million in facilities, fleet and other charges, primarily related to our domestic fleet restructuring. $106 million charges related to early debt extinguishment. And a $3 million mark to market loss on fuel hedges. The December quarter results are quite solid when you consider over $100 million negative impact that super storm Sandy had on the airline operation and the refinery as well as $100 million in lower hedge gains on a year-over-year basis. This is proof that our core business remains strong and we look forward to continue margin expansion into 2013. As Richard mentioned, we accrued $372 million in profit sharing in 2012 with $63 million of that in the December quarter. I would also like to echo Richard’s comments and thank the Delta employees for all their efforts this year in taking great care of our customers, running an outstanding operation in producing top-tier financial results. There is no better way for us to show our thanks than with a profit-sharing check that will be delivering on February 14. Shifting the revenue during the December quarter, our top-line revenue grew $203 million or 2% despite a 1 point decrease in capacity. Passenger revenues increased $215 million with unit revenues for the quarter up 4.3%. We saw a 2 point improvement in yield combined with a 2 point increase in load factor, proof that our revenue initiatives and prudent capacity deployment are driving results. December marked the 21st…

Thanks, Ed. Good morning everybody. I’ll start with our cost performance. For the quarter, total operating expense increased by $376 million as a result of higher fuels and salaries. Non-operating expense decreased by $43 million showing the continuing benefits of our debt reduction strategy. Our non-fuel unit costs were up 5.7% for the December quarter driven by our capacity reduction, continued investment and wage increases, and investments in our products, services, and operations. We expect our non-fuel unit costs will be up 4% to 6% for the full year 2013 with the March quarter up 6% to 8%. March quarter costs, which are pressured by the year’s largest quarterly capacity decline, will represent the peak of our cost growth for 2013. That growth should then moderate over the remainder of the year as capacity levels flatten out and the benefits of our $1 billion structural cost initiatives begin to kick in. These initiatives are designed to stem the rate of growth in our costs without jeopardizing the revenue production enabled by our network, product, and our service. We are restructuring our domestic fleet and one of the key tenants of our structural initiatives is maximizing the benefit across our organization. To do this, we are actively replacing 50-seat regional flying with more efficient and customer preferred 717s, MD-90s, 737-900s, and CRJ900s. Recent agreements with SkyWest, Pinnacle and Bombardier have produced a clear path for us to eliminate more than 250-seaters and we will begin taking deliveries of the mainline aircraft and the CRJ900s in the September quarter. We are also redesigning our maintenance program to improve processes and resource management as well as lowering materials expense by seeking out market and part out opportunities. We have purchase agreements in place for 23 MD-80 aircraft at very low prices, which will…

Thanks Richard, Ed, and Paul. Kyle, we are now ready for questions from the analysts. So, if you could review the process for asking questions. And again, we ask everyone to limit themselves to one question with a brief follow-up.

Thank you. (Operator Instructions) We’ll take our first question from David Fintzen with Barclays Capital.

Hey, good morning everyone. Just a quick question adding in your comments, you mentioned sort of 2013 could be a year where you further expand your revenue premium, I am just – I am curious how to think about obviously that’s happening to start, it seems to be happening to start the year, but I am curious how the up gauging as it phases in, in the back of the year, it starts to impact that. I mean, is that a case where we should expect it sort of mid-year and then start to come in or do you think you can continue to expand out your RASM relative to the industry even as you are getting into the bigger aircraft?

Well, the certainly the up gauging strategy on our domestic network will put some pressure on our unit revenues and thus our competitive RASM performance is certainly going to be a huge positive for our margins.

Right.

It’s the most important measure that we look at. And as I think you know, we have already been seeing a fair bit of the up gauging over the course of the last couple of years, so driving both margin and RASM enhances. And I think what the way we look at it is the product superiority of the aircraft we are up gauging to will more than compensate for any RASM dilution we might be seeing.

Okay, okay. And then just quickly on the Latin entity, you mentioned sort of the strength in Mexico and Central America, obviously there is a fair amount of capacity going into the deep South America, American markets, and if you sort of extract the competitive capacity dynamics is that how the sort of underlying demand trends sort of in those deeper, bigger South American markets vary?

David, this is Glen Hauenstein, how are you?

Good. How are you doing?

Good, thank you. With the demand in deep South America is quite strong, and as you point out in the short run, the capacity might be outrunning it by just a tad, but as we move forward, we think that will catch up with the higher demand levels and we should be in good shape by the mid level, the mid part of this year.

Okay, great. Appreciate the color guys.

We’ll take our next question from Michael Linenberg with Deutsche Bank.

Hey guys. I guess just a couple here. Just on the Virgin piece, I know that the plan is for the transaction that closed at the end of 2013. How soon now do you start code-sharing and maybe where are you on the application for antitrust – the application for antitrust immunity?

Well, Ben Hirst will take the antitrust immunity.

Yeah, I’ll take the last piece. In terms of the process, we basically have three sets of regulatory approvals that we have to obtain. There is – there are competition reviews that are underway at the Justice Department and the EC. We will be filing probably by the end of the month for antitrust immunity with the Department of Transportation. And there is a review in the UK of the shareholders’ agreement to ensure that citizenship and control remains with the EU citizens. We’ve also filed with DOJ and we have begun meetings with DG Comp and the EC. So, the process is well underway, it’s on schedule. And we are hoping that these reviews all come together within a six-month timeframe.

And on advancing the code-share and frequent flyer reciprocity, we are working very hard on the systems side of that and expect to have that up and running in the second or third quarter, end of the second, beginning of the third quarter, with the desire of having those codes in place before we head into the winter iota season and fully functioned and active.

Okay, great. Thanks, Glen. And then just my second question, I know given your NOL position, I don’t think it’s going be many years I think before you guys are paying cash taxes, but at what point do you start incurring a book tax and I realized so many people or the market itself is fixated on EPS. Is that something that kicks in later this year or is that more a 2014 type phenomenon?

Mike, this is Paul. There is no hard and fast rule. We are working with the accountants on that and the reversal has to do with historical earnings and where we are on book tax differences. So, as we continue to work through that, that’s something that could happen in 2013.

Okay, very good.

Mike, this is Ed. Let me just clarify Paul’s comments he is right we are working through it, but I also – I don’t think we are going see it in 2013. And I think what we are looking at is maybe by the end of 2013, we’ll make that determination for 2014 looking forward.

Okay, very helpful. Thanks guys.

We’ll take our next question from Glenn Engel with Bank of America.

A couple of questions, please?

Glenn?

Hello.

Hi, Glenn.

Hi, sorry about that. A couple of questions. One on Trainer, I guess, I was seeing some reports about something wrong with the pipeline slurry and that the refinery was – the Trainer refinery was closed right now. Is that true?

No, Glenn, this is Paul. There was one unit that we have taken down briefly as a result of some of the slowdowns from the storm. That unit is expected to be up and running within a week, but we have not shutdown the refinery.

The ancillary businesses had revenues down about 15% from a year ago in the fourth quarter 185 or 216, what’s driving that and will those businesses start to grow again?

That represents a shift in our strategy from our MRO as we are starting to streamline to higher margin accounts and business and we expect to grow off that platform in 2013.

So, you’ll start with a lower base, but start to grow from a lower base?

Yeah, with more profitable business?

And finally just an update on pensions, how much, what is the pension on funded liability now and what’s the impact on earnings in 2013?

The pension on funded liability is going to increase in at year end by about $2 billion. That has a minimal effect on expense based on where we are in amortization and the result of lower interest rate. And there is no material change in funding, because we have the benefits of the airline relief under the Pension Protection Act.

Thank you very much.

We’ll take our next question from Jamie Baker with JPMorgan.

Hey, good morning everybody. First question for Glen, the changes in the SkyMiles program are obviously relevant to passengers, I suppose an enthusiast I am somewhat interested, but usually Frequent Flyer issues kind of fly below the radar screen for me as an analyst in terms of what I obsess over on a daily basis. I am sure lot of effort went into the SkyMiles overhaul. But is this something where we should actually expect to see an impact either on the income statement or in terms of liabilities on the balance sheet in 2013?

I will talk – let Paul talk to the balance sheet implications. But from revenue perspective we are looking at the evolving SkyMiles to be better loyalty program for its customers and drive the type of customer behavior that we would like to encourage in the future. So, I think before we didn’t discern between a customer that was a high yielding customer versus a low yielding customer and I think as we continue to evolve those programs, we will be continuing to favor the higher yielding customers over lower yielding customers.

Okay.

And on your question about effectiveness, the change that we announced is not effective until 2014.

Correct, yeah that’s a good point. From a brief follow-up while I have you Richard or for Ed the typical area of pushbacks that I get from investors is that Delta is under-investing in aircraft. Sure you are generating cash, but you are living borrowed time, you are going to face this massive re-fleeting bill somewhere down the road. And then normally I countered by pointing out that as you shrink capacity, fleet age actually doesn’t rise very quickly and the company has a demonstrable preference for shall we say experienced airplanes that require far or less capital than buying new. I will admit this isn’t so much a question as an opportunity, I guess for you to just kind of bring us up to speed on your thoughts as it relates to this issue, as it relates to capital deployment and the potential need for new planes down the road?

Well, first airlines and Delta in particular have to take the cost of capital into account with making investment decisions around the fleet. And what we have done at Delta is adopted a strategy of making sure that we use our shareholders’ money, we use that money prudently to get returns from day one a fleet investment. So, we have the right mix going forward. If you look at our wide-body fleet the average age of the wide-body fleet is 13 to 14 years. And on our domestic fleet, we began this year with a significant number of new deliveries. So, we are always working to calibrate the right mix of new deliveries and used deliveries. Given the glut of narrow-bodies coming on the market right now, we think that there is going to be significant opportunities because residual values on eight to ten year old narrow-body airplanes are on a significant downward slide. And we will continue to be with the glut of airplanes there. And you see our operating performance in terms of completion factor on-time and the like it’s at the very top of the industry. So, we have a firm specific capability of being able to manage a stream of new deliveries, but at the same time making sure we are averaging down our cost of capital, so that we can always hit our 10% to 12% return on invested capital. These are very long-lived assets and a long-lived asset in order for us to able to hit our returns we have got to capture the residual value. And be certain that when we are making pricing and investment decisions that those pricing and investment decisions are properly taking into account the cost of our capital.

And I think this is the kind of disciplined approach that any capital intensive business must take.

I appreciate the color, it’s a point that we have tried to make, but I think it certainly helps hearing it directly from you. Thanks again.

Thanks Jamie.

We will take our next question from Savi Syth with Raymond James.

Good morning everybody. Just a question on Pinnacle, I know historically Delta and Northwest have had in-house regional carriers that you have either sold or kind of shutdown. And historically the airline industry hasn’t had a good track record of having a carrier within a carrier. And I was just curious as to what might be different with Pinnacle and maybe what the longer term plan is for Pinnacle?

Actually if you look at what we have done with Pinnacle it’s really been – it’s going to be a pretty revolutionary step because we actually for the first time have the right cost structure in place and the right fleet in place to be able to operate the most efficient 70, 76 seat operator in the industry. And the way the pilot agreement is setup, we don’t end up with the seniority issues that have cost issues in that industry in the past. And it gives us the ability to provide a very high quality product at the most efficient returns on capital investment in that fleet. So, we’re pleased with the opportunity and believe that it’s going to drive a very significant advantage to Delta over the long run.

Great, just a follow-up on that, do you have an idea of the timing or how many 50-seat retirements you will see in 2013 and may be 2014, how is that planning going?

Actually we are well down the path in the Pinnacle debt agreement and the agreement to bring them out of bankruptcy we have the right to retire the entire 140 airplane fleet of 50 seaters. And if you recall the Bombardier transaction that we did earlier this year for 40 firm and 30 option, 76 seaters, they have facilitated the removal of 60 of those airplanes and we have a clear path to get down in the range of 100 to 125 within the next 18 to 24 months.

Alright, great, thank you.

We’ll take our next question from Duane Pfennigwerth with Evercore Partners.

Thanks. Good morning. Just wondering with the Easter shift here in March, why would unit revenue by default decelerate from I think the 5% to 6% level that you’ve outlined here?

Duane, this is Ed, we are not necessarily anticipating its going to decelerate, I think that the clarity that we have to January is obviously much better than looking out towards the end of March. So, we want to put guidance out there on a quarterly basis that we are comfortable on the balance, but we hope to do better. But with the bookings where they are right now, we see January very strong, we see every month in the quarter is strong. And our visibility to March isn’t as clear, clear as it is currently here in January.

Okay, thanks for that. And then just on the structural cost initiative the $1 billion, my question is relative to what is that $1 billion, I mean it feels like at least based on the current schedules you go from pretty material capacity declines in the first quarter to modest capacity growth in the June and September quarter. It feels like these fleet initiatives you are going to the higher trip costs, but obviously lower unit cost, fleet mix, it seems logical that your CASM pressure moderates in the second half, just given us two factors, but what is the $1 billion relative to? Thank you.

What we said is that after the results of this $1 billion are fully baked in, we would expect to see forward-looking trends of flat to 2% CASM off of 2013 levels. So, it’s a combination of 2012 base as well as anticipated growth in cost, but we are flattening out unit costs based on that 2013 level.

Sorry, what is the underlying capacity growth assumption in that flat to 2%?

Flat.

Thank you.

We’ll take our next question from John Godyn with Morgan Stanley.

Hey, thanks a lot for taking my question. First, I was just hoping to ask about thoughts on the shareholder returns strategy. Of course, this is a decision that’s going to happen later in the year and it’s a Board level decision, but to the extent that you could just share your own preferences in so far as your sort of informing or advising the Board on what to do on dividends versus buybacks and how you think about that just be helpful to hear your thoughts?

John, I think that we should respect our Board processes. And we’ll – I’ll be certain to keep the investor base well informed as we move through this process.

Got it. Okay, thanks. And just another question Richard as investors tried to forecast the next couple of years, I think one of the big risks they focus on is the degree to which a reacceleration in capacity growth that large low cost carriers or may be a new entrant could force an end to the profit cycle for legacies. I know it’s a tough question to answer, but how can investors be confident that your financials are more insulated from this threat than they have been in the past?

I would make two key points there. The first if you think back to airlines like Skybus $2 billion of capital is no longer available. With the new Basel rules and the rules in the U.S. on the requirements for banks and financial markets to keep capital in reserve, it’s a much different situation in terms of capital in the marketplace. And the second piece of that is, Brent is at about $1.10 and that model is a very difficult model at these sorts of fuel prices. So, when you look at where the capital markets and how the capital markets approach financing airlines today and look at where fuel prices are today, I think we are in a very different dynamic.

Great, thanks.

We’ll take our next question from Hunter Keay with Wolfe Trahan.

Hey, good morning everybody. When you talk about taking corporate market share, can you just explain what you mean by that? Are you talking about winning new clients? Are you talking about getting a bigger piece of the pie from say like a Fortune 25 company? And how has that mix contributed to the growth in share that you have gotten? And how are you going to think about that mix as it contributes to the overall corporate share that you have growing? How is that mix going to go forward between sort of opening up new clients and getting a bigger piece of the pie from existing ones?

Hunter, this is Ed. I think it’s all the above. We have picked up over the last couple of years some very significant new accounts. We have improved our share substantially in a number of existing accounts and I would say the financial services and the banking sector is probably the most important there in terms of where we have been able to not just pick up new accounts, but also improve. We had a very, very large, one of the largest banks in the world that we just signed in the last six months a corporate deal with out of New York that we never previously had a corporate arrangement with. And what they are looking for is they are looking for a career that can take them anywhere they need to go on the schedule and the frequency. It’s a big part of the reason behind the Virgin Atlantic transaction, because the JFK-Heathrow market is the sector that those – the financial services firms travel – travel most, have the greatest amount of need for and schedule frequency for and we have been able to knock another thing off the list. They look for the product the investments in the new international product. The flatbeds upfront will be fully complete by spring of 2014 there. So, it’s a combination of our geography, our schedule, our service levels, the great service our employees provide, which matters. That’s all contributing here. And probably the easiest way to sum all that up is if you look at our fourth quarter, our total corporate revenues were up almost 10% against a marketplace that was pretty flat in terms of overall corporate travel spend in the fourth quarter of the year. That’s a big number.

Okay, thanks Ed. And Paul, a question for you on Trainer, you gave some color on the sourcing of Bakken, which I appreciate, but can you maybe feel about giving a little more, where are you in the process of overall sourcing crude? Where do you stand with say some of your supply relationships now that you have gotten a few months under your belt say some domestic versus international suppliers? Where do we stand with Bakken? You said you are getting a shipment this quarter, I mean, what percentage of the overall crude that you source to Trainer you think will come from Bakken now versus by the end of the year? Any other thoughts on sort of general crude sourcing would be helpful.

Well, Hunter, our crude sourcing is handled by a multi-year agreement with BP that we entered into at the time of acquiring the refinery. So, there is no change in that. Bakken as a source of crude, it’s a little bit early to tell as to what kind of volume we can run in it, but as we run this first shipment this quarter we’ll have more colors to what the total potential is, but it’s pretty significant.

Okay, thank you.

Our next question comes from Kevin Crissey with UBS.

Good morning. Thank you for the time. Can you give us an idea of capacity by month, if your RASM, you gave January RASM 5% to 6%, what kind of capacity are we looking at January through February, I didn’t know the 3% for the quarter?

We gave you the core, we typically don’t give the forward months Kevin, but they are all generally in the range we talked about. I think February we might have a little more capacity out because of the leap year from last year, but it’s they are all relatively consistent.

Okay.

January and February with it being the highest months of capacity constraint as compared to March.

Okay, thanks. And can you talk about and maybe it’s gone, talk about Atlanta and any changes you are seeing competitive positioning there?

There is not a whole lot of changes to what you seen. We have AirTran/Southwest down to about 170 departures. If you recall their peak was just under 300 several years ago, so continued rationalization of capacity on their part. And as we look forward that into the published schedule, that capacity rationalization continues.

Okay. Thank you.

We are going to have time for one more question from the analysts.

Our next question will come from Basili Alukos with Morningstar.

Hi everyone. Good morning. Thanks for taking my question. I wanted to go back to the joint venture with Virgin Atlantic, I guess two questions. First given what happened with the TNT-UPS decision I am wondering if there is breakup fee in that contract. And then secondly, you have kind of mentioned where you are in the review process and finalizing the deal. I am just wondering if you can give us context in kind of other deals that you have done and if you would say you are at a similar pace behind, ahead where you would be for another M&A or a transaction deal?

In terms of the details of the contract, there is no material breakup fee involved in any of contracts. The pace of the deal we think is as we have expected where we are as I said earlier in the midst of three separate regulatory or kinds of regulatory reviews competition, ownership and control in the UK and the joint venture review at DOT. Our objective is to get those completed within a six months timeframe that can extend a bit. And there are some variables in all the agencies, but we think that’s a realistic target. And we have made our filing at Justice under Hart-Scott Scott. We have made our initial filing at DG Com in the EU. And by the end of the month, we should file for ATI with DOT. We have had initial meetings with all agencies. We are on the basis of those reasonably optimistic about our timeframe.

Okay and then I guess I asked at the analyst day you guys hadn’t decided as far as what plane size you were going to use or what gauges and I think you are still reviewing that with your pilots. I am just thinking about that decision which planes to you use and then kind of where you are in the process of having figured out what you’re going to fly and more gates and routes in the context of capital discipline. I am just trying to figure both of those out I mean if you haven’t just decided your planes is that something that’s typical?

Well, we until we get all the requisite approvals, Delta will continue to make its route decisions and capacity decisions by route independently as will Virgin.

Okay, so the fact that I mean I have – discussions haven’t started or haven’t been finalized that’s kind of a normal occurrence is not abnormal?

Correct.

Okay, great. Thanks guys. I appreciate it.

Thanks. And that’s going to conclude the analyst portion of the call. I am now going to hand it over to Ned Walker for the media section.

Okay, hi. Thanks very much Jill. Kyle we are ready for the media Q&A, if you could go ahead and review the process for the media as to how to get in the queue for questions. Also I would like to ask the media if they could limit it to one call and a brief follow-up that way we should be able to accommodate most people. Thank you. We are ready.

(Operator Instructions) And we will take our first question from Josh Freed with The Associated Press.

Hi there. Ed mentioned earlier some of the change in thinking around the incentives on the Frequent Flyer program. And my question is can you tell us a little more about sort of how far you are through that process and also if when that process is done whether American Express will still be your mileage card partner when this is all done?

Yes, American Express is our, I’d say our most important commercial partner globally and we have got a long-term contract with them. And we are not going to be able to talk about any forward-looking changes to the plan as you can appreciate, we are always thinking about ways we can innovate for the future, but that’s about as far as we can go.

Alright, thank you.

We’ll take our next question from Kelly Yamanouchi with the Atlanta Journal-Constitution.

Hi, there. I am interested in finding out a little bit more detail on how much in financial benefits you have seen from your operational performance improvements?

Well, I think its best summarized by two years of industry RASM premium.

Okay. Do you attribute that mostly to your operational or I guess what share of that premium do you attribute to operational performance improvements?

Kelly, we don’t break those out independently. It’s the coalescence of a great operation, great customer service by our employees, the phenomenal job by our sales and distribution organization, and a great job by our network planning. So, like everything in an airline, it’s all a team sport and everybody is playing a really great role in making sure we deliver a premium product for a premium unit revenue production.

Great, thank you.

Okay. Kyle, if you could once again review the process for getting into the queue to ask questions and with that, we will turn it over to the next question.

(Operator Instructions) We’ll take our next question from Mary Jane Credeur with Bloomberg News.

Richard, there was a lot of talk at Investor Day and again today about how significantly Delta has changed its business model and how peers have had a lot of capacity discipline in the last couple of years. Is the airline industry model overall fixed and was Warren Buffett wrong when he said back in the, I think it was the early 90s that someone should have shot the Wright Brothers?

Well, I mean Mr. Buffett is a lot smarter than I am, so I would never open on his investment strategy. So, I will set that question aside. If we look at overall where Delta is and we can just speak from the perspective of Delta, 2013 will be a really strong year for this company and it will be a good improvement over 2012. And so it will be the fourth consecutive year of strong performance. And we look out across at our three-year strategic plan. We see continued strength in the business model. I think we have the obligation and the opportunity to continue to innovate to be certain that we approach this as a business and approach the deployment of capital in a rationale and prudent way. And if we continue to do that and we continue the kinds of innovations that we have undertaken here at Delta, we are confident about the long-term investment thesis for our enterprise.

How much skepticism are you still hearing though when you are talking to big institutional investors who have been afraid of the space for many years and rightfully so, what’s their biggest holdback?

Mary Jane, this is Paul Jacobson. I think in our conversations with investors, I think there is meaningful consideration given to history of the business. And we believe that fundamental change has occurred, but we are in the early stages of consolidation which makes the industry more stable than it has been. And I think when you look at our recent performance over the last few years viewed against the lens of history I think the signs are petty promising. And we expect that continued improvement going forward.

Great, thank you.

Our next question comes from Linda Loyd with the Philadelphia Inquirer.

Thanks for taking my call. Other than the impact of Superstorm Sandy on the Trainer refinery, have there been any other unexpected costs or difficulties that you did not anticipate?

No, this is Richard. If you took Sandy aside completely and the effects it had on distribution in and out of the facility, everything has gone as planned.

And so you are still very satisfied with your business decision to buy a refinery?

Actually, since we have actually closed on the refinery and spent a lot of time in the turnaround process, we have become more certain of how prudent that investment is for our company.

Thanks very much.

Okay, great. Kyle that will conclude the call and thanks to Richard, Ed, Glen, Paul, and Ben concludes the December quarter call. We will be back in three months for the March quarter. Thanks very much everyone.

This does conclude today’s conference call. Thank you all for your participation.