Southwest Airlines Co.'s (LUV) third-quarter earnings soared as
the carrier trimmed its expenses, thanks to lower fuel costs and
boosted revenue.
Southwest, the largest carrier of domestic U.S. passengers, is
moving away from its roots as a pioneer discount airline and
looking to expand its service area beyond the 48 contiguous U.S.
states.
Southwest said its passenger revenue per available seat mile, a
key performance metric for the airline industry, rose 5.1% in the
latest quarter.
Southwest reported earnings of $259 million, or 37 cents a
share, up from $16 million, or two cents a share, a year earlier.
Excluding special items, earnings rose to 34 cents a share from 13
cents.
Operating revenue rose 5.5% to $4.55 billion.
Analysts polled by Thomson Reuters had most recently forecast a
profit of 34 cents a share on revenue of $4.53 billion.
Fuel and oil costs were down 5.1% at $1.45 billion, as fuel
costs per-gallon fell 3.2% to $3.06. Total operating expenses fell
2.4% to $4.16 billion.
Earlier this month, Southwest reported traffic slid 0.6% in the
third quarter, though capacity rose 1%. Load factor, or the
percentage of available seats filled, was 80.8%, down from 82.1% a
year ago.
Shares closed Wednesday at $16.41 and were inactive premarket.
The stock is up 60% since the start of the year.
Write to Ben Fox Rubin at ben.rubin@wsj.com
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