Delta Airlines 2015 Annual Report Download - page 35

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TableofContents
RegionalCarriersExpense.Thereductioninregionalcarriersexpenseisprimarilyduetolowerfuelcostfromadecreaseinthepricepergallonoffuel,lower
capacityandreducedmaintenanceexpenses.During2015,weremovedthirty50-seatregionalaircraftaspartofourstrategytorestructureourdomesticfleet.
ContractedServices.Theincreaseincontractedservicesexpensepredominantlyrelatedtocostsassociatedwiththe3.0%increaseincapacityandadditional
temporarystaffing.
DepreciationandAmortization.Depreciationandamortizationexpenseincreasedyear-over-yearprimarilyduetoinvestmentsinnewA330-300,B-737-900ER
andCRJ-900aircraftandaircraftmodificationsthatupgradedaircraftinteriorsandenhancedourproductoffering.
LandingFeesandOtherRents.Landingfeesandotherrentsincreasedprincipallyduetoincreasednumberofdeparturesandhigherrentalrates.
ProfitSharing.Theincreaseinprofitsharingisdrivenbyanincreaseinfullyearpre-taxincomecomparedtotheprioryear.Ourbroad-basedemployeeprofit
sharingprogramprovidesthat,foreachyearinwhichwehaveanannualpre-taxprofit,asdefinedbythetermsoftheprogram,wewillpayaspecifiedportionof
thatprofittoemployees.Indeterminingtheamountofprofitsharing,theprogramdefinesprofitaspre-taxprofitadjustedforprofitsharingandcertainotheritems.
Foryearspriorto2016,ourprofitsharingprogrampaid10%toemployeesforthefirst$2.5billionofannualprofitand20%ofannualprofitabove$2.5billion.
Beginningwith2016pre-taxprofit(tobepaidoutin2017),theprofitsharingformulawillbeadjustedtopay10%ofannualpre-taxprofit(asdefinedbythe
termsoftheprogram)and,ifweexceedourprior-yearresults,theprogramwillpay20%oftheyear-over-yearincreaseinpre-taxprofittoeligibleemployees.The
profitsharingprogramforpilotsremainsunchangedandwillcontinuein2016underitsterms.
PassengerService.Passengerserviceexpenseincludesthecostsforonboardfoodandbeverage,cleaningandsupplies.Thisexpenseincreasedyear-over-year
primarilyduetocostsassociatedwithenhancementstoouronboardproductofferingandthe3.3%increaseintraffic.
Other.Otheroperatingexpenseincreasedprimarilyduetocostsassociatedwithsalesofnon-jetfuelproductstothirdpartiesbyouroilrefinery.
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