Fuel hedging

[Glenn Quagmire]

These tumbling oil prices are going to hurt the trainer effort.

They are going to provide a huge boost to those who didn't hedge.

AA, along with the oil market provided fuel to the big gains in the stock markets today.

 

[WorldTraveler]

carriers who hedge will be hurt in a falling fuel environment.

Trainer provides lower fuel prices overall because Trainer also buys crude.

AA as noted before gained because it pushed a greater percentage of its operating income to the bottom line - because they did not account for taxes, and took smaller charges for restructuring, and spent less on employees.

also, AA spent less than DL or UA on stock buybacks or dividends.

and all of those fuel hedge gains can be more than wiped out by currency losses. AA made it clear that it still has over $700 million tied up in Venezuela which they may have to write down.

AA's currency crisis could be far larger than fuel hedge losses at other carriers.

be very careful about exalting in AA's lack of fuel hedge losses...

 

[jcw]

Right it's a great strategy since DL has to burn 12% more fuel however good news it doesn't offset the 3% lower fuel cost so net net DL loses again

Sorry spin didn't work this time

Hail to DL

Keep up the affirmations

How is your list coming

 

[AANOTOK]

Damn it, AA can't do anything right. No matter what they do or what the results are, it's just ain't right....damn it!

 

[WorldTraveler]

Right it's a great strategy since DL has to burn 12% more fuel however good news it doesn't offset the 3% lower fuel cost so net net DL loses again

uh, DL burned LESS fuel in its consolidated operation than AA did - and generated more revenue as well.

SO, no, you are factually wrong.

but you obviously are driven solely by trying to find a come back than talking about the truth.

And, AANOTOK, the issue is solely about financial risk.

AA in its most recent annual report says that 40% of its revenue comes from sales outside of the US and 24% for US.

AA has NO currency hedging program.

IN contrast, DL has continued NW's currency hedging program esp. in the Japanese Yen. and that program has reduced DL's financial hit because of the yen devaluation.

DL also hedges against the Canadian dollar.

Because AA has no currency hedges, AA will take EVERY devaluation of currencies directly against its operating revenues. Their SEC filing says so.

Not hedging fuel is great and if that was the end of the story, AA might be in pretty good shape relative to the rest of the industry in the next few quarters.

However, fuel hedges can also benefit in falling oil prices. Perhaps you missed that DL and WN both posted fuel hedge gains and losses with the net of both being POSITIVE for the company.

It is not a given that fuel hedges will end up with a loss for a company in falling fuel situations.

Returning to currency, AA specifically noted in its earnings release that there is still more than $700 million of AA revenue which it cannot get out of Venezuela.

AA hasn't even publicly accounted for Argentina's devaluation other than in its revenue numbers.

The dramatic drop in AA's Latin RASM is directly related to currency devaluations in those countries.

A few people have heard about fuel hedging and thought AA was in great shape relative to its peers while being completely unaware of the huge currency risk that AA faces which is far larger than the fuel hedging losses that any carrier will take.

 

[jcw]

Once again look at the amount of fuel burned

DL was over 1000

aA was under 1000 sorry you struggle to do math DL is 12% less fuel efficient

How is your list coming

Still struggling

Are you thinking about going taking that class over again or is that another place you were kicked out of

 

[La Li Lu Le Lo]

Even on ignore your quotes take up too much space!

 

[WorldTraveler]

Once again look at the amount of fuel burned

DL was over 1000

aA was under 1000 sorry you struggle to do math DL is 12% less fuel efficient

How is your list coming

Still struggling

Are you thinking about going taking that class over again or is that another place you were kicked out of

you can't read a financial statement.

because if you could, you would see that AA burned more fuel in its consolidated operation and generated more revenue.

I have a statistic for your fantasy financial metrics.... most pAArAAnoid... as in you are the most paranoid to find out the actual truth so you, like a dozen and a half other AA internet fans who have gone before swing into full attack mode to try to do everything you can to refuse to acknowledge that AA has spent more of the money it took from you to buy shiny new airplanes and pay for executive perks while making you think that you are on top of the world.

YOU are the only one that could be in drugs to not be able to see what Parker has done to you.

thankfully, there are people on here who are smart enough to realize that when they have to keep holding onto cards 14 years after they were made, they are NOT better off.

and all of your focus on fuel hedging on other carriers highlights that the risk which AA UNIQUELY faces is a currency meltdown in Latin America which could FAR eclipse any fuel hedging losses at any other carriers.

are you absolutely serious?

AA receives 40% of its revenues from outside the US and has NO CURRENCY HEDGES?

keep an eye on that $700M.

Parker might slip something in your drink and convince you that it is YOUR responsibility to cover the cost of the losses associated with its currency losses in Latin America.


and based on everything you have written over the last few days, you will do it and keep on smiling.

someone has been brAAinwAAshed.

 

[jcw]

Little off your meds today

Thought one - take the class again

 

[WorldTraveler]

the one in which you learned to make up numbers that aren't in financial statements or the one in which you are brainwashed into celebrating the success of a company that has made its employees WORSE OFF relative to their peers?

 

[FrugalFlyerv2.0]

AA has NO currency hedging program.

IN contrast, DL has continued NW's currency hedging program esp. in the Japanese Yen. and that program has reduced DL's financial hit because of the yen devaluation.

DL also hedges against the Canadian dollar.

Because AA has no currency hedges, AA will take EVERY devaluation of currencies directly against its operating revenues. Their SEC filing says Returning to currency, AA specifically noted in its earnings release that there is still more than $700 million of AA revenue which it cannot get out of Venezuela.

AA hasn't even publicly accounted for Argentina's devaluation other than in its revenue numbers.

The dramatic drop in AA's Latin RASM is directly related to currency devaluations in those countries.

 
Sheesh!
This guy makes more deflections than a Russian sub in Swedish territorial waters.
 
 

someone has been brAAinwAAshed.

 
Coming from you this is rich.
BTW - how is that list of 10, nay 1, thing that DL has done wrong?
 

 

[WeAAsles]

Yes if I worked for Deltoid I'd be much better off being Ready Reserve and only have to work some bear minimum hours on call at the company's discretion. And medical benefits are overrated anyway. I'd also be much better off only making $12.00 per hour. Keeps a man humble being dirt poor and if I need more there's always Government assistance too anyway.

Yes much better off indeed.

 

[FrugalFlyerv2.0]

Yes if I worked for Deltoid I'd be much better off being Ready Reserve and only have to work some bear minimum hours on call at the company's discretion. And medical benefits are overrated anyway. I'd also be much better off only making $12.00 per hour. Keeps a man humble being dirt poor and if I need more there's always Government assistance too anyway.

Yes much better off indeed.

 
 

 

[MetalMover]

Right it's a great strategy since DL has to burn 12% more fuel however good news it doesn't offset the 3% lower fuel cost so net net DL loses again

Sorry spin didn't work this time

Hail to DL

Keep up the affirmations

How is your list coming

Don't worry. This a DL strategy for world domination. 

 

[WorldTraveler]

I'm waiting for the number that jcw has that shows that DL lost money in SEA and that its revenue went down.