Spinproof:
Special items and one time charges are part of the profit and loss reporting, but not part of the profit and loss picture for the ongoing business.
For instance, lets say every month you make $10,000 and your bills are $2,500 giving you a $7,500 "profit" that you save & invest. In this same month, your daughter is getting married and she watches lots of the "E" channel. She decides to throw a bash of a reception and pay Brad & Angelina to attend. The bill for the wedding comes to $90,000.
If you evaluated that month, you have a $7,500 "profit" excluding the $90,000 bill for the reception. With the wedding, you report a loss of $82,500.
But hey, the kid is out of the house and your basic finances are sound.
In Delta's case, they separated several thousands of employees, which will help future profitability and prepare for the integration of NWA.
What some pilots are overlooking is that around half of Delta's fuel is hedged at $90 a barrell and those hedges start to run out in the next couple of quarters. Like SWA, DAL is still selling tickets for less than they cost. Also like SWA, DAL would be losing big money without the hedges.
While the performance at the top of its peer group is great, with nearly 100% load factors (EVERY seat has been taken on my flights lately) this business should be raking in the money if the market would bear the appropriate price level.
Most of the fix will require airlines like AirTran, Spirit, SWA and the others to either go the heck out of business, or price their product at a realistic level. A family friend got a round trip ticket on Spirit for $1 and was bragging about it and AirTran is still running $49 sales. The regulators need to realize that suicide is not competition.
In our business environment, Delta's JPWA is a good deal for labor. Most folks don't appreciate it for what it is in these times.
