Southwest Airlines is a passenger airline that provides scheduled air transportation in the United States.
Southwest Airlines narrows Q1 loss
Air carrier Southwest Airlines (NYSE:LUV) reported a narrower-than-expected adjusted net loss during first quarter on Thursday, as the company continued to struggle with rising energy costs.
Net income climbed to $98 million, or 13 cents a share for the period ended March 31. That is up from $5 million, or a penny a share, recorded last year.
Excluding acquisition and integration-related costs, hedging and fuel contract impacts and other items, the company had an adjusted loss of two cents, compared with adjusted earnings of three cents.
Revenue jumped 29 percent to $4 billion, aided by the AirTran acquisition.
On average, analysts polled by Bloomberg were forecasting a net loss of four cents a share, on revenue of $4 billion.
Shares of Southwest Airlines traded 29 cents higher at $8.18 each on the New York Stock Exchange on Thursday afternoon.
"Despite a modest loss, excluding special items, our first quarter results were notable, with outstanding revenue production and, except for jet fuel, better-than-expected operating costs," Southwest's chief executive Gary Kelly said in a statement.
"Energy price increases continue to pressure costs, which only serve to reinforce our commitment to eliminate waste and maximize efficiency throughout our company."
Fuel was Southwest's biggest expense, at $1.5 billion — an increase of $472 million, or 45.5 per cent from a year ago.
Southwest said it expects fuel costs including taxes to be in the $3.40 to $3.45 a gallon range for the current second quarter, compared with $3.44 a gallon in the first quarter.
Passenger revenue per available seat mile, or Prasm, a key performance metric for the airline industry, rose 1.6 percent in the first quarter.
Traffic grew 23 percent from a year earlier while capacity rose 25 percent. The company’s load factor, the percentage of available seats filled, was 77.3 percent down from 78.3 percent.
The company had 698 aircraft that including 610 Boeing 737 aircraft and 88 Boeing 717 aircrafts, and offered services to 72 cities across 37 states, at the end of December 31, 2011.