Swa Reports 1q05 Profit Of $76m

[ngneer]

DALLAS, April 14 /PRNewswire-FirstCall/ -- Southwest Airlines (NYSE: LUV - News) today reported first quarter 2005 net income of $76 million, or $.09 per diluted share, compared to $26 million for first quarter 2004, or $.03 per diluted share. These first quarter 2005 results compare favorably to the First Call mean estimate of $.05 per diluted share.

Full press release

This company is amazing. Other than SWA and probably JetBlue, the industry will be awash in red ink. SWA has figured out how to carve out a successful niche for themselves, maintain it and even expand it.

I'll be flying them on Monday from ISP to BWI and it will be my first opportunity to check out the new concourse at ISP.

 

[autofixer]

They've got it dialed in and now are firing for effect!

 

[ngneer]

And on top of that, they're announcing a bunch of new flights:

Southwest Airlines Gives Customers Some Summer Luvin'; Airline Adds Flights to Customers' Favorite Destinations
Thursday April 14, 6:41 am ET

DALLAS, April 14 /PRNewswire-FirstCall/ -- Southwest Airlines (NYSE: LUV - News) Chief Executive Officer Gary Kelly today announced plans to enhance existing nonstop flights in several Southwest Airlines markets. In two summer installments, the airline will add new nonstop flights in the following cities: Baltimore/Washington, Fort Lauderdale/Hollywood, Las Vegas, Long Island/Islip, Oakland, Orlando, Philadelphia, Raleigh-Durham, San Diego, Tampa Bay, and West Palm Beach. To take advantage of this new Southwest Airlines service and super low fares, visit:

http://www.southwest.com/jp/luvhome.shtml?...wservice_041505 .
"With the delivery of new aircraft, Southwest Airlines continues to add new nonstop service to our Customers' favorite destinations," said Kelly. "Southwest Airlines is adding service to meet high Customer demand and to give our Customers more flight options when traveling."


The 11 additional flights break down as follows:

Beginning July 17, 2005:
* Two additional daily nonstop flights between Las Vegas and San Diego
(for a total of 14 daily).
* One additional daily nonstop flight between Las Vegas and Oakland (for
a total of 13 daily).
* One additional daily nonstop flight between San Diego and Oakland (for
a total of 18 daily).
* One additional daily nonstop flight between Philadelphia and Orlando
(for a total of six daily).
* One additional daily nonstop flight between Philadelphia and Fort
Lauderdale/Hollywood (for a total of three daily).

Beginning September 6, 2005:
* One additional daily nonstop flight between Long Island/Islip and
Tampa Bay (for a total of three daily).
* One additional daily nonstop flight between Long Island/Islip and
Orlando (for a total of five daily).
* One additional daily nonstop flight between Long Island/Islip and West
Palm Beach (for a total of three daily).
* One additional daily nonstop flight between Baltimore/Washington and
Tampa Bay (for a total of six daily).
* One additional daily nonstop flight between Raleigh-Durham and Orlando
(for a total of three daily).

 

[mrman]

This is 190% increase over last years first quarter!

 

[luv2fly]

This is 190% increase over last years first quarter!

[post="262235"][/post]​

It is nice to know at least some in our industry have a clue on how to run an airline. Way to go WN.

 

[WNrforlife]

We are going to dominate the U.S. domestic market over the next 5 years. The legacy carriers are going down hard!!!

 

[WNrforlife]

And on top of that, they're announcing a bunch of new flights:

Southwest Airlines Gives Customers Some Summer Luvin'; Airline Adds Flights to Customers' Favorite Destinations
Thursday April 14, 6:41 am ET

DALLAS, April 14 /PRNewswire-FirstCall/ -- Southwest Airlines (NYSE: LUV - News) Chief Executive Officer Gary Kelly today announced plans to enhance existing nonstop flights in several Southwest Airlines markets. In two summer installments, the airline will add new nonstop flights in the following cities: Baltimore/Washington, Fort Lauderdale/Hollywood, Las Vegas, Long Island/Islip, Oakland, Orlando, Philadelphia, Raleigh-Durham, San Diego, Tampa Bay, and West Palm Beach. To take advantage of this new Southwest Airlines service and super low fares, visit:

http://www.southwest.com/jp/luvhome.shtml?...wservice_041505 .
"With the delivery of new aircraft, Southwest Airlines continues to add new nonstop service to our Customers' favorite destinations," said Kelly. "Southwest Airlines is adding service to meet high Customer demand and to give our Customers more flight options when traveling."
The 11 additional flights break down as follows:

Beginning July 17, 2005:
* Two additional daily nonstop flights between Las Vegas and San Diego
(for a total of 14 daily).
* One additional daily nonstop flight between Las Vegas and Oakland (for
a total of 13 daily).
* One additional daily nonstop flight between San Diego and Oakland (for
a total of 18 daily).
* One additional daily nonstop flight between Philadelphia and Orlando
(for a total of six daily).
* One additional daily nonstop flight between Philadelphia and Fort
Lauderdale/Hollywood (for a total of three daily).

Beginning September 6, 2005:
* One additional daily nonstop flight between Long Island/Islip and
Tampa Bay (for a total of three daily).
* One additional daily nonstop flight between Long Island/Islip and
Orlando (for a total of five daily).
* One additional daily nonstop flight between Long Island/Islip and West
Palm Beach (for a total of three daily).
* One additional daily nonstop flight between Baltimore/Washington and
Tampa Bay (for a total of six daily).
* One additional daily nonstop flight between Raleigh-Durham and Orlando
(for a total of three daily).

[post="262228"][/post]​

Here we grow again!!!!!

 

[jbguppy]

Here we grow again!!!!!

[post="262245"][/post]​

SWA recently cut back their hiring and growth plans significantly, they are able to turn a profit due to paying half price for fuel.

It is all about the fuel hedge. That is the only difference. Kudos to SWA for being able to use their long term credits in the hedging game to make a profit. ALso cool that they were able to raise fares and you guys are applauding....

Low expectations, low results...

Pass me that bag of peanuts, it is going to be a long flight,

Does anyone think this is going to last forever?

JBG

 

[mrman]

[
Does anyone think this is going to last forever?

JBG

[post="262251"][/post]​

[/quote]


It has for over 30 years

 

[KCFlyer]

Low expectations, low results...

JBG

[post="262251"][/post]​

As opposed to the other legacy carriers -- no expectations, no results?

 

[KALB2]

I'm not surprised. Yesterday I returned from a trip to Albuquerque. I was on WN, ALB-BWI-ABQ. All flights on time, all flights full. My first experience on the -700 with blended winglets. I buy a lunch-to-go from the airport concessions for the long flights.

This is one very satisfied anf LOYAL WN customer.

 

[Red Tail Bear]

As opposed to the other legacy carriers -- no expectations, no results?

[post="262253"][/post]​

We,re just riding out the storm KC, thats all we can do for now. Unlike WN we dont depend on just domestic revenue to survive. The ship-MSP/DTW/IND/NRT is'nt taking on much water- (Lcc's) And once fuel prices come back to earth there'll be smooth sailing on the horizon. The storm can't last forever.

 

[SWAFA30]

SWA recently cut back their hiring and growth plans significantly, they are able to turn a profit due to paying half price for fuel.

Actually, that's not true. WN Ops at Chicago MDW are undergoing massive growth and will increase to over 190 departures per day by July 2005. Today's press release announcing First Quarter financials revealed that 7 aircraft options for 2006 have been converted to firm orders raising 2006's delivery total to 33.

"During first quarter 2005, we exercised seven Boeing 737-700 options for 2006 delivery, bringing our 2006 firm orders to 33, with one 2006 option remaining, for a planned annual available seat mile growth of approximately seven percent.

Futher, Pilot and Flight Attendant hiring remain strong with 10 classes of 100+ F/As on the books for 2005. The "CAREERS" section of Southwest.com shows job fairs and active recruiting for
various postions in multiple locations.

It is all about the fuel hedge. That is the only difference.

Fortunately, aggressive cost cutting measures are being implemented to prepare for the day when fuel hedges are no longer enough. What the fuel hedges have done is buy precisious time to streamline the operation to reflect the fact that LCC competion has increased and Legacy carrier costs are coming down. Note the following quote for the aformentioned press release:

Gary C. Kelly, CEO, stated: "Considering the many challenges our industry continues to face, we are grateful to report first quarter 2005 earnings of $76 million. Our rigorous focus on cost reduction and successful fuel hedging program shielded us from record high energy prices and enabled us to report our 56th consecutive quarter of profitability.


"Excluding fuel, our unit costs declined 3.8 percent. This superb performance reflected a tremendous effort by our Employees, and they continue to work hard to improve productivity throughout our Company.


The entire press release can be found at Southwest.com

http://www.southwest.com/about_swa/press/prindex.html

 

[luv2fly]

We are going to dominate the U.S. domestic market over the next 5 years. The legacy carriers are going down hard!!!

[post="262243"][/post]​

Wow!! What an insightful post as usual.

 

[funguy2]

"Excluding fuel, our unit costs declined 3.8 percent. This superb performance reflected a tremendous effort by our Employees, and they continue to work hard to improve productivity throughout our Company.

Comapred to 1Q04, this is true.

Compared to 4Q04, LUV's CASM ex-fuel increased .10cents to 6.32cents, and CASM w/ fuel increased .11cents to 7.70cents.

The profit was all fuel hedge. $76mil net profit and $155 benefit with the fuel hedge. Without the hedge, and all else equal, LUV would have lost $79mil. While LUV continues to use its excellent management to its advantage, I would think this cannot continue forever. Something in the industry has got to give.