DALLAS, May 18, 2016 /PRNewswire/ -- Southwest Airlines
Co. (NYSE: LUV) (the "Company") announces the Southwest Airlines
Board of Directors, at its meeting held today, increased the
Company's quarterly dividend by 33 percent and authorized a new
$2 billion share repurchase program.
Under the new $2 billion share
repurchase authorization, the Company intends to repurchase an
initial $500 million of Southwest
common stock under an accelerated share repurchase program. The
quarterly dividend will increase to $.10 per share from $.075 per share, beginning with the
159th consecutive quarterly dividend declared today to
Shareholders of record at the close of business on June 8, 2016, on all shares then issued and
outstanding. The dividend will be paid on June 29, 2016. Annualized, this increased
dividend amounts to approximately $255
million based on approximately 632 million1
shares of common stock outstanding.
Gary C. Kelly, Chairman of the
Board, President, and CEO, stated: "I'm pleased to announce the
Board's decision today to increase our quarterly dividend by 33
percent, which would provide an approximate one percent annual
dividend yield to our Shareholders, based on yesterday's closing
stock price of $42.20. On a
cumulative basis over the past five years, including today's
increase, our quarterly dividend has grown more than twenty fold.
The Board also authorized a $2
billion share repurchase program, representing our largest
repurchase authorization in a decades-long history of returning
value back to our Shareholders through share repurchases. Since
2010, we have reduced our outstanding shares by over 25 percent
through the cumulative repurchase of $4
billion of common stock. Our strong performance, investment
grade balance sheet, and cash flow outlook has enabled the Board's
actions today that reinforce our ongoing commitment to return value
to our Shareholders."
The Company recently completed its previous total $1.5 billion share repurchase authorization,
including $700 million repurchased
this year under accelerated share repurchase programs. The Company
repurchased $500 million in common
stock pursuant to an accelerated share repurchase program launched
during first quarter 2016, and $200
million pursuant to an accelerated share repurchase program
launched during second quarter 2016, receiving approximately 11.9
million and approximately 4.5 million total shares, respectively.
Under the total $1.5 billion share
repurchase authorization, the Company repurchased approximately
37.3 million shares. The Company's share repurchases under the new
$2 billion repurchase program will be
made in accordance with applicable securities laws in open market,
private, or accelerated repurchase transactions from time to time,
depending on market conditions, but may be discontinued at any
time.
1As of May 16,
2016.
Cautionary Statement Regarding Forward-Looking
Statements
This news release contains forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act
of 1934, as amended. Specific forward-looking statements
include, without limitation, statements related to (i) the
Company's plans with respect to the return of value to Shareholders
and (ii) the Company's financial outlook. These forward-looking
statements are based on the Company's current intent, expectations,
and projections and are not guarantees of future performance.
These statements involve risks, uncertainties, assumptions, and
other factors that are difficult to predict and that could cause
actual results to vary materially from those expressed in or
indicated by them. Factors include, among others, (i) the
impact of economic conditions, consumer behavior, fuel prices,
actions of competitors (including without limitation pricing,
scheduling, and capacity decisions and consolidation and alliance
activities), governmental actions, and other factors beyond the
Company's control, on the Company's business decisions, plans, and
strategies and (ii) other factors, as described in the Company's
filings with the Securities and Exchange Commission, including the
detailed factors discussed under the heading "Risk Factors" in the
Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 2015.
SW-DSR
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SOURCE Southwest Airlines Co.