Delta Posts $1.77B profit

[GuppyWN]

I forsee more bonuses for management and a 1% payraise for employees.

Gup

 

[Schiphol]

I forsee more bonuses for management and a 1% payraise for employees.

Gup

Now that.....is sadly funny.

 

[FDJ2]

While I'm glad to see Delta making tons of cash (1.77 billion), I'm also wondering where the outrage is amoung the pilots who did take pay cuts, seems like they could pay you after all doesn't it?
Guess the question is when will you ask for it back.

I hate taking pay cuts, however, there was no one even close to Delta's C2K pay rates for over two years. When we finally did take pay cuts in Dec. 2004, we were still industry leading after a 32.5% cut. The additional 14% wasn't fun either, however negotiating a contract in bankruptcy during an 1113c never is. With that said, the concessionary CBA is significantly shorter than demanded, the cuts were significantly less and shorter in duration then expected and we have already seen significant return on our investment.

When we first negotiated a $2.1B claim for our approximate $980M concession ( company quoted the concessions as $280M/year for 3.5 years, it's probably significantly less than that), who would have envisioned that we would get 60 cents on the dollar for that claim, in other words $1.26B in cash back to the Delta pilots this last May? That was on average approximately $200K/pilot in a single day. Furthermore, we have already received one small pay raise, will get another one in January and will enjoy some profit sharing $$$.

Am I outraged that we took these cuts and the company's use/abuse of the 1113c, sure, but am I happy that DAL is doing well and that our claim sold well and that we will all see more in PC-5 recovery, profit sharing and pay raises due to DAL's strong performance, you bet.

 

[Old School]

Very impressive. Especially with $70+ oil for much of the quarter. Hopefully this profitable trend will continue for all of us who are lucky enough to have airline jobs.

 

[FDJ2]

. Just thought there would be a call to arms by the pilots to get some back

We just got about $1.2B back through our claim sale, which was bolstered by among other things, DAL's strong projected earnings. The rest of what comes back will also come via our contract, with pay raises attached to profits and profit sharing. As far as getting it all back, we're less than 2.5 years away from our amendable date and 19 months from exchanging openers. The better the company does, the more we'll get back.

 

[Palomino]

Very impressive. Especially with $70+ oil for much of the quarter. Hopefully this profitable trend will continue for all of us who are lucky enough to have airline jobs.

i'm tired of the high-priced oil argument against worker wages. it's crap. cost of business goes up - stick it to the consumer.

this airline return-to-profitibality trend only indicates that the market price of oil has little bearing on a well-run machine.

truckers, freighters, newspaper route runners, lawn workers all are affected by the price of oil. pass it down the line - TO THE CONSUMER - and stop crying to me that oil keeps an airline from turning a profit. it's all crap.

and this quarter especially proves that. it's almost a level playing field now with hedging being of little use in these turbulent crude oil pricing times.

time to take it back...

 

[FDJ2]

I'm glad to see things picking up. Keep Captain Moak in office and you'll have some great leadership going into negotiations in a couple of years.

Lee Moak has done a great job, and while I have not supported everything the MEC has done, they have charted a strategic plan that seems to be paying off.

Will we keep Lee? That's probably up to Lee, my guess is that he's had about enough. I'd be surprised to see him run for re-election, but I've been surprised before, so I won't rule it out.

 

[FDJ2]

So, what about the 32.5% paycut in 2004 before the 14%.

We were still industry leading after the 2004 cuts. It's hard to keep pay rates that have our F/Os making more than an AA captain when you're losing billions. Do they count yes, but they weren't a part of this contract.

How much do you pay for health care now compared to before LOA 51/current contract?

The same

What about scope?

That's the worst part of our contract, imo, but keep it in perspective.

30 76 seat jets over 3 years, hmmmm, that's about 180 total seats. Yeah, we caved.

What about sick leave? Vacation? Hmmm ... No concessions?!

Sick leave is still industry standard if not better than most, if you only use 240 hours over a three year period, you will have experienced no cut whats so ever. I didn't lose a day of vacation, and I kept my work rules.

You're right about negotiating with the gun to your head and the guys that claim you caved in without reason are off base. But, your head is in the sand if you don't think that you took meaningful concessions that helped produce this bottom line.

Of course we took concessions that helped the bottom line, but we got back over $1.21B in May, which is significantly more than the total concessions of LOA 51 and we'll continue to get more back whenever the company posts a profit.

 

[FDJ2]

The real net profit was about 380mil. In realty It's not that much.

Yes it is.

 

[Sedona16]

The real net profit was about 380mil. In realty It's not that much.

Its more than SWA made last year for the same quarter. Its more than SWA made this year for the same quarter. If it continues it would be almost 1.6 BILLION for a fiscal year....double what Delta conservatively projected for the first year out of bankrupsy. Delta based its profits on oil at $70/barrel.

Not sure how you conclude "It's not that much"? Sounds like sour grapes.

 

[anewunion]

#1. Let's not compare DAL with SWA. I like to keep apples with apples.

#2. 380 mil. as a Q2 profit from a 8.7 Bil. mkt cap. company is not the best R.O.N. Please understand Q2 has always been a stong time of the year for the airline industry. In other words, this is the time to shine.

#3. DAL used a split between the new accounting and the old. This makes it very hard to follow the results from an investors prospective, Hence the stock didn't move very much.

and #4.

Trust me, there are no sour grapes here. DAL will be a very strong Intl. airline in the coming years. My comment was directed towards the folks that believe DAL was only making money because of it's employees give backs. I feel that this is a very complicated senerio, and by making 380 mil. out of BK. is not the tells of a robbery.

 

[Benjamin Dover]

Of course we took concessions that helped the bottom line, but we got back over $1.21B in May, which is significantly more than the total concessions of LOA 51 and we'll continue to get more back whenever the company posts a profit.

FDJ,

I'm not going to debate the details with you, but my points were the Delta pilot group gave much more in concessions than you alluded too. I know because I used to work there and lived under LOA 51 myself for awhile. The last contract prior to your current one was C2K. Are your pay rates in your current contract just 14% less than your rates in contract 2000 or a bit more? I think over 40% less is a signficant concession that will take quite some time to get back and the claim sale does not equal wage concessions dating back to December '04.

Check your old pay stubs to see what your monthly deduction is for health care compared to C2K.

Maybe you kept the same number of vacation days, but what about the amount of your bank?

So, be proud of Moak, et. al. and DALPA's ability to keep much more intact than UAL, but I think you're under-stating the contribution of the pilot group to the company's performance.

I have many buds there and hope Delta continues to do well. I also hope the Board chooses wisely in selecting the next CEO.

Regards,

BD

 

[FDJ2]

#1. Let's not compare DAL with SWA. I like to keep apples with apples.

How about profits to profits?

#2. 380 mil. as a Q2 profit from a 8.7 Bil. mkt cap. company is not the best R.O.N. Please understand Q2 has always been a stong time of the year for the airline industry. In other words, this is the time to shine.

Excluding reorganization and related one-time items, Delta said it had a profit of $274 million, or 70 cents a share, in the second quarter.

I'm not sure what other airlines posted a profit of 70 cents/share when shares are selling for about $21, but maybe you can point them out for us.

#3. DAL used a split between the new accounting and the old. This makes it very hard to follow the results from an investors prospective, Hence the stock didn't move very much.

Or maybe the stock already made a run based on projections that DAL would outperform.

and #4.

Trust me, there are no sour grapes here. DAL will be a very strong Intl. airline in the coming years. My comment was directed towards the folks that believe DAL was only making money because of it's employees give backs. I feel that this is a very complicated senerio, and by making 380 mil. out of BK. is not the tells of a robbery.

Good point, but that's another subject in and of its self and doesn't change the fact that DAL is a strong performer and has put up solid numbers.

 

[FDJ2]

First of all, thanks for the good wishes.

Lee Moak was not responsible for LOA 46, which was a huge concession.

We can't pretend that DAL lives in a bullet proof glass bubble where pilot wages and benefits can be nearly double their competitors. Were pay cuts and concessions required to return DAL to profitability, yes they were. Without them DAL would not have received the financing it needed to stay in business and once in bankruptcy, do you truly believe the pilots would have escaped with their contract, let alone C2K intact? Given the economic, political and legal landscape at the time, the DAL pilots did an exraordinary job defending themselves and preserving as much as they have and they have already begun to reap some of the rewards for their sacrifices.