Those variables are shell variables. To expand them as parameters to another program (ie expr), you need to use the $ prefix:

 expr $x / $y

The reason it complained is because it thought you were trying to operate on alphabetic characters (ie non-integer)

If you are using the Bash shell, you can achieve the same result using expression syntax:

echo $((x / y))

Or:

z=$((x / y))
echo $z

Why not use let; I find it much easier. Here's an example you may find useful:

start=`date +%s`
# ... do something that takes a while ...
sleep 71

end=`date +%s`
let deltatime=end-start
let hours=deltatime/3600
let minutes=(deltatime/60)%60
let seconds=deltatime%60
printf "Time spent: %d:%02d:%02d\n" $hours $minutes $seconds

Another simple example - calculate number of days since 1970:

 let days=$(date +%s)/86400