Delta Air Lines posted a record annual loss for 2020 on Thursday but its shares rose as executives forecast a recovery this year and a reduced cash burn.

The second-largest U.S. airline by passenger traffic said it lost $12.4 billion last year – its first loss since 2009 – and $755 million in the fourth quarter. The adjusted loss came in at $2.53 per share.

Operating revenue declined 63% to $17 billion for the year and 65% to $3.97 billion for the quarter as the coronavirus pandemic ravaged demand for air travel. Analysts had expected an adjusted loss of $2.50 per share on $3.59 billion in revenue.

“Our December quarter results capped the toughest year in Delta’s history,” Delta CEO Ed Bastian said in a news release.

However, Delta shares climbed 2.6% to $41.47 in trading Thursday as the airline reported that its cash burn averaged $12 million a day in the fourth quarter, down from $24 million a day in the third quarter and a reduction of nearly 90% since the early days of the pandemic.

Delta is now projecting an average daily cash burn of $10 to $15 million during the first quarter of 2021 and cash breakeven in the spring.

“Remaining agile and disciplined with our cost structure will be key to our success, and when combined with an improving demand environment, will allow us to return to the free cash flow generation needed for debt reduction,” interim co-CFO Gary Chase said.

The Transportation Security Administration screened just 324 million travelers last year, down from 824 million in 2019. Delta expects revenue to fall 60% to 65% in the first quarter but Bastian said he was “optimistic this will be a year of recovery and a turning point that results in an even stronger Delta returning to revenue growth, profitability and free cash generation.”

“We don’t anticipate that by the summer travel will be back anywhere close to where it previously was, but it will be a meaningful improvement, sufficient to be able to drive profitability for us in the back half of the year,” he told Reuters.

(Photo by Jamie Squire/Getty Images)

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