Originally Posted by
EdGrimley
Delta Air Lines Inc Stock: Profit Sharing Reduction Helps Offset 15% Increase, Says Credit Suisse
Credit Suisse noted that the fixed increase of 15% by the amendable date is slightly more than it expected, but the profit sharing offset is more significant at this point. With the 20% profit sharing threshold moving to $6 billion for all employees, the firm expects approximately $500 million of potential savings, compared to $2.5 billion of threshold. The firm believes that this will be large enough saving to offset the fixed increase of 15% for pilots, giving extra cost of approximately $400 million.
Credit Suisse has math troubles!!
Assume Delta makes 6 Billion
Old method = 2.5B * 10% + 3.5B * 20% = 950 million for all emploees.
New method = 6B * 10% = 600 million for all employees.
So, the difference for all employees is 350 million. You figure the pilot share of that is maybe 150 million at the most, but there is no way you can have the savings for just the pilots be more than the total for all employees!