Southwest Airlines reports $16 million net quarterly profit
BY D.R. STEWART World Staff Writer
Thursday, October 18, 2012
Southwest Airlines, the nation’s leading discount carrier, reported on Thursday a third quarter net profit of $16 million, or 2 cents per share, compared with a 2011 third quarter net loss of $140 million, or 18 cents per share.
Third quarter revenue at Southwest was $4.3 billion, unchanged from the same quarter a year ago.
Southwest Chairman, President and CEO Gary Kelly said third quarter passenger revenue, unit revenue and load factor were all third quarter records, but the company needs sustained revenue momentum to achieve its goal of 15 percent pre-tax return on invested capital.
“While in line with the domestic industry, our third quarter 2012 year-over-year unit revenue growth was more sluggish than planned due to weaker demand, particularly in September,” Kelly said. “While the economy remains a significant concern, we are encouraged, thus far, by October’s bookings and revenue trends.
“Thus far in October, passenger unit revenues are running ahead of the comparable year ago period by approximately 4 percent. For next year, we are excited about planned initiatives including the first phase of our new revenue management system.”
Third quarter expenses totaled $4.26 billion, a 4.2 percent increase compared with last year’s third quarter.
Southwest’s largest third quarter cost item was fuel and oil, at $1.53 billion, down 3.7 percent from the same quarter a year ago.
Salaries, wages and benefits totaled $1.19 billion in the third quarter, up 3.8 percent from the same period last year.
As of Wednesday, Southwest had $3.5 billion in cash and short-term investments, compared with $3.14 billion at the close of 2011’s third quarter.
Southwest’s long-term debt on September 30 was $2.96 billion versus $3.1 billion on the same date last year.