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Operating Margin Comparison 2008 Q1 US Majors  
User currently offlineKnope2001 From United States of America, joined May 2005, 2900 posts, RR: 30
Posted (6 years 4 months 1 week 4 days ago) and read 1351 times:

Although net profit or loss is a "real" number, it sometimes contains things which really obscure how the core business is doing. And just talking about a dollar figure of profit or loss doesn't take into account the relative size of the company.

So to help get a better take on the financial results of the airline operations of the majors, below are the operating margins for the 1st quarter with special items factored out (like the $6.1b non-cash writedown that Delta took).

An operating margin of 2% means that for every $100 dollars of revenue, you earned a profit of $2.

1st Quarter 2008 operating margins, excluding special items

+3.5% …. Southwest
+2.1% .… JetBlue
-2.1% ….. Continental
-3.0% ….. Delta
-3.3% ….. American
-3.8% ….. Northwest
-5.9% ….. Alaska
-5.9% ….. AirTran
-6.0% ….. USAirways
-9.4% ….. United

Things not included in these numbers, such as special charges, interest expense, taxes, etc, are not meaningless. But the meat and potatoes of an airline are the operating results...revenues minus expenses. I thought this might be a interesting snapshot of how the majors fared in this past quarter in relation to each other.

My own gut reaction on these numbers:

--Surprise at the positive results of JetBlue

--Confirmation on suspicion that the Delta and Northwest numbers were nowhere near as out of control as they seemed (although certainly not good.)

--Surprise at how badly United did, and how those numbers were almost lost among those huge Delta/NWA net numbers.

[Edited 2008-04-25 12:17:17]

2 replies: All unread, jump to last
 
User currently offlineScottB From United States of America, joined Jul 2000, 6752 posts, RR: 32
Reply 1, posted (6 years 4 months 1 week 4 days ago) and read 1345 times:



Quoting Knope2001 (Thread starter):
So to help get a better take on the financial results of the airline operations of the majors, below are the operating margins for the 1st quarter with special items factored out (like the $6.1b non-cash writedown that Delta took).

Thanks for taking the time to compile these numbers; I think they present a much better picture of the operational health of the carriers than the big headlines do.


User currently offlineMaverickM11 From United States of America, joined Apr 2000, 17450 posts, RR: 46
Reply 2, posted (6 years 4 months 1 week 3 days 23 hours ago) and read 1316 times:



Quoting Knope2001 (Thread starter):
Things not included in these numbers, such as special charges, interest expense, taxes, etc, are not meaningless.

What is WN without the fuel hedge benefit?



E pur si muove -Galileo
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