Spirit 2Q Profits rise sharply.

[kwick]

Why is it that when SW profits from their hedges it's a good thing, but it's a bad thing for Spirit?

Just be glad that it's a profit, and not a loss, as most other airlines are reporting.

 

[huncowboy]

A fuel hedge is considered an "investement" not an expense. So when we bought the fuel hedges...it had no affect on the profit/loss for that quarter.

So how about when you sell it?

 

[Beetle007]

From looking at the bts.gov website, it appears as though it is treated as a loss or profit regardless of it has been sold. All that matters is its value.

If I buy 1 million worth of fuel hedges and sell it for 1.3 million, then it is posted as a realized profit of 0.3 million at the end of the quarter.

If I buy 1 million worth of fuel hedges and the value goes up to 1.3 million, then it is posted as an unrealized profit of 0.3 million at the end of the quarter.

I could be wrong...but this is my understanding. And, the opposite would occur for fuel hedges that are a loss.

 

[troll565]

Why is it that when SW profits from their hedges it's a good thing, but it's a bad thing for Spirit?

Just be glad that it's a profit, and not a loss, as most other airlines are reporting.

The point is, if we didn't sell our fuel hedges (which we did to pay bills, from what I was told by a corporate worker), we would have lost a ton of money.


Just ask the crew that taxied into MCO and when the ground guys saw us, walked away cause we hadn't paid them.

 

[kwick]

The same could be said about SW. They made 3.5 Billion from hedges in last ten years.

How much do you think they would be ahead without that?

 

[Beetle007]

The same could be said about SW. They made 3.5 Billion from hedges in last ten years.

How much do you think they would be ahead without that?

I read an article where Garry Kelly (CEO of SWA) was asked why he doesn't give some of the fuel hedge money back to the investors in the form of a dividend. His answer was that it would be put SWA into bankruptcy.

So, do you think the investors at Spirit will pocket the fuel hedge money and put us into bankruptcy? or, will they "reinvest" the fuel hedge money back into the airline?

 

[gatorbird]

I read an article where Garry Kelly (CEO of SWA) was asked why he doesn't give some of the fuel hedge money back to the investors in the form of a dividend. His answer was that it would be put SWA into bankruptcy.

So, do you think the investors at Spirit will pocket the fuel hedge money and put us into bankruptcy? or, will they "reinvest" the fuel hedge money back into the airline?

Don't mention this investor team in the same breath as Kelly & Co. at SWA. That bunch is interested in running a successful airline; our investors are interested in profit only...the means to that profit is of no concern to them. Two different ways of thinking entirely.

gator

 

[troll565]

Recalling 25 on 12/1

 

[Mike man]

I really don't think the recall is something to get that excited about...yes people are coming back=good

I'm sure it is to only replace attrition.