Comments

You must log in or register to comment.

cyberentomology OP t1_isy6m33 wrote

Data Source: DAL 22Q3 Financial Results (October 13, 2022)

Tool: SankeyMatic

Some Interesting Observations:

  • They're getting jet fuel for only $3.53 a gallon... Best price of all of the big US airlines. I
  • Delta shows nearly $1.2B in refinery operations. In 2012, Delta acquired the recently closed Trainer Refinery in Pennsylvania from ConocoPhillips, as a way of insulating itself from volatility in refining margins. It can refine about 3 billion gallons of jet fuel a year. The refinery operation itself is breaking even, but shows on the bottom line in Delta having the lowest fuel cost of all three major US airlines.
  • Fleet-wide, they're averaging about 60 passenger miles per gallon.
  • Average annual (loaded) payroll per FTE is about $152K, significantly better than either AA or UA, and that's not counting another $12,000 per employee of profit sharing... Delta pays well!
  • Total Revenue is about 25 cents per passenger-mile. They keep 1.2 cents of that.
  • Taxes! The government is making about more money on the airline than the airline is making on the airline.
    • $267M in federal income tax (unusually high)
    • $198M in federal payroll tax
    • $226M in federal excise tax on jet fuel (24.4 cents/gallon) -- this is largely what funds the FAA.
    • State Taxes on jet fuel are unknown but state jet fuel tax per gallon in their US hubs - Delta seems to have hubs in high tax states:
      • Georgia (ATL) 7.5 cents plus local sales tax of 8.9% (31 cents)
      • Michigan (DTW): 3 cents
      • Utah (SLC): 2.5 cents
      • California (LAX): 2 cents
      • New York (LGA/JFK): 6.5 cents
      • Washington (SEA): 11 cents
      • Minnesota (MSP) : 15 cents
4

skyecolin22 t1_isz2a3d wrote

Are they paying state taxes on jet fuel that they produce through their refinery?

2

cyberentomology OP t1_isz3hch wrote

Most likely, but that would be whatever the local state tax is at the point of purchase

2

NerdyDan t1_isz2148 wrote

I had no idea delta had their own refinery

3

cyberentomology OP t1_isy6zot wrote

Southwest is posting their Q3 results next week... Will be interesting to see what theirs looks like as their business model is very different.

2

[deleted] t1_isyqqdu wrote

[deleted]

2

cyberentomology OP t1_isyr8tl wrote

Not offhand, but I can throw one together pretty quick. They may account for things a bit differently, but I’ll check it out.

1

Chickensandcoke t1_isyqr9c wrote

Why is their tax % so much different than United’s?

2

cyberentomology OP t1_isyqzks wrote

Not entirely sure - there may be state and local taxes involved, or they have significant operations somewhere that has a higher tax rate.

3

skotman01 t1_it01nr2 wrote

Not to nit pick…Airlines has a space in it when referring to the company name.

Thank you for this, I’ll be sharing it internally because it definitely helps explain where money comes and goes.

1

cyberentomology OP t1_it01zw8 wrote

Good catch! I wasn’t fully paying attention when typing out the title. Can’t even blame autocorrect.

1

cyberentomology OP t1_it022pe wrote

delta is pretty good about lots of details in their financial quarterlies.

1

juan-de-fuca t1_it09nuk wrote

I’ve always wondered how much their bottom line is impacted by hedging fuel price fluctuation. They must be huge into futures and swaps.

1

Dude_Hold_My_Bear t1_it18fy1 wrote

Almost 13B in income and only a net income of 695M. Operating income at 1.4B, and while I'm not a finance guy, I feel like 695M net isnt very good. Maybe I don't understand this (open to correction), so feel free to correct my understanding.

1

cyberentomology OP t1_it19ncj wrote

It’s a high volume, low margin business. Any net income that is positive is a good thing.

The numbers from a year ago are terrifying.

Lufthansa does similar volume and lost money in the first half of the year.

1