SWA posts $162 Mil Net Income/ $.22 per share

[pilotyip]

Tony your right, with lucky's attitude he is probalby lucky to have job. Why do pilots put down others good news.

 

[firstthird]

General,
I'm no CPA but I'm pretty sure the reason you can't just take net profit and subtract out the hedging gains goes something like this.

1 - hedges cost money to buy (expense) that we wouldn't have if we didn't hedge

2 - hedging profits entail taxes to be paid on them, so 189 million is hedging gain is really less because of the tax cost associated with the financial derivative

3 - w/o hedges we would have had a different cost argument to enter in our revenue maximization formula, thus probably charged higher fares (up to a point, which would depress loads, which is why revenue management guys should get big bucks. FWIW I think we undercharged all spring and summer and now for that matter. with loads as high as they've been, we should've cleared more net income)

4 - there is another part to it, something about which side of the balance sheet it goes on, but I don't remember it right now.

short version is that
profit - hedges = profit w/o hedges
is not a valid equation.

It could be safely said that our profit would have been less, but how much less is not self-evident w/o an hp12c accounting calculator and more knowledge / time than I have.

 

[SWA/FO]

Soon the fuel hedges will run out and the legacys will be taking names...SWA F/O you are such a chump

JEALOUS??? - why you hangin out on a Southwest Airlines thread, Now you get upset when there is good news posted within it. Take your negative energy to your local legacy carrier forum.....we don't want it here.

 

[Andy]

LUV, nice quarterly numbers. It's nice to see at least one airline that's actually able to make a consistent profit.

A very well run company with deep management talent. Definitely a rarity in the airline business.

 

[Tanker Clown]

Just think how much money SWA would have made if they took concessions like DAL...but then again, maybe with $1 Bill in consessions you guys could have ditched the LBB overnights.

You SWA guys are hosed. Now that your $29 dollar hedges have run out, all that you have are the $45 hedges that are almost gone...and after that all you have is $51 hedges. With oil at almost $90 you guys are all screwed. I've been saying this for almost 66 strait quarters...as soon as your hedges run out you are screwed.

You guys should start an airline within an airline. An "ultra low cost" airline. It would undercut the likes of Song and make you more competitive.

I'll be looking for you SWA guys in the soup lines.

Bye Bye -- Tanker Clown

 

[727C47]

The problem is the trailer park traveler will only pay so much to fly before they decide its to expensive. Tickets over $159 are going to decrease your loads.

SWA is not a premium brand.

Starbucks charges $4 dollars a cup and gets it. McD's could never sell a $4 cup of coffee even if it was the same kind of coffee.

Now a company like Virgin USA, has the potential to be a premium brand and could charge a four digit fare without offending its core consumer.

SWA is a low three digit cap. High four digits make money even with $100 oil.

jumpseat home last week, (thank you SWA) ,sitting between two business women,who work for top drawer companies ,flying for business on SWA,and happy with the product, the demographics of the entire manifest probably covered the spectrum from Gucci to K-mart, EVERYBODY seems to fly on them,everybody seems to like it. the numbers speak for themselves.

 

[General Lee]

General,
I'm no CPA but I'm pretty sure the reason you can't just take net profit and subtract out the hedging gains goes something like this.

1 - hedges cost money to buy (expense) that we wouldn't have if we didn't hedge

2 - hedging profits entail taxes to be paid on them, so 189 million is hedging gain is really less because of the tax cost associated with the financial derivative

3 - w/o hedges we would have had a different cost argument to enter in our revenue maximization formula, thus probably charged higher fares (up to a point, which would depress loads, which is why revenue management guys should get big bucks. FWIW I think we undercharged all spring and summer and now for that matter. with loads as high as they've been, we should've cleared more net income)

4 - there is another part to it, something about which side of the balance sheet it goes on, but I don't remember it right now.

short version is that
profit - hedges = profit w/o hedges
is not a valid equation.

It could be safely said that our profit would have been less, but how much less is not self-evident w/o an hp12c accounting calculator and more knowledge / time than I have.

Nah, it said they earned $183 million due to the hedging contracts. Then it said they made a net profit of $162 million. You can twist the wording all you want as a CPA, and it sounds like you would make a good CFO at a legacy carrier. I don't think you are right. Read the article again and show me where it says half of what you say. It looks very suspicious. Anyway, have a great one and it really is great you have those hedges.

Bye Bye--General Lee

PS--not that this means anything, but on Cramer on CNBC Wednesday night a caller asked him about buying SWA stock (LUV), and he said not to. He actually then said he might try DAL. Crazy, eh?

 

[waitin]

Yep...makes a lot more sense to buy shares of a company coming out of BK than one with 66 consecutive profitable quarters....
ALWAYS listen to (and invest in) what you hear from the US media....


GL, back in the day ('02-03ish), you usually had constructive comments...from a fairly neutral observer, you have really sunk to new lows in your 2007 posts...try stepping back from the WN-hate posts....

 

[ofacegangsta]

Everyone of you clowns that is bagging on SWA needs to slap yourself in the head and wake-up. Are you seriously hoping that another airline will go tits-up and put more of your peers on the streets? Are you really feeling that inadequate about your own job that you need to bash someone else sitting in the front trying to figure-out the best way to ask ATC for a short-cut? How about you get off the computer, slap your fat wife in the ass, and try to get laid instead of bagging on other pilots.

 

[Hardcorr]

When do you sleep General. It's late on the East coast. Just finished a grueling four leg day on the west coast. No weather in sight. Atlanta looked like it had some wx issues today

 

[JumpJetter]

General

SCOREBOARD! Questions?

 

[walkthasky]

The problem is the trailer park traveler will only pay so much to fly before they decide its to expensive. Tickets over $159 are going to decrease your loads.

SWA is not a premium brand.

Starbucks charges $4 dollars a cup and gets it. McD's could never sell a $4 cup of coffee even if it was the same kind of coffee.

Now a company like Virgin USA, has the potential to be a premium brand and could charge a four digit fare without offending its core consumer.

SWA is a low three digit cap. High four digits make money even with $100 oil.

Youre an idiot

To say we only made a profit because of hedges is the same as to say the only reason some legacies are in business because of CH11, and to say that the legacies are only making money because of international routes. Puhleeze, business is business genious :laugh:

 

[slaquer5]

Just think how much money SWA would have made if they took concessions like DAL...but then again, maybe with $1 Bill in consessions you guys could have ditched the LBB overnights.

You SWA guys are hosed. Now that your $29 dollar hedges have run out, all that you have are the $45 hedges that are almost gone...and after that all you have is $51 hedges. With oil at almost $90 you guys are all screwed. I've been saying this for almost 66 strait quarters...as soon as your hedges run out you are screwed.

You guys should start an airline within an airline. An "ultra low cost" airline. It would undercut the likes of Song and make you more competitive.

I'll be looking for you SWA guys in the soup lines.

Bye Bye -- Tanker Clown

Now why bother saying that, these idiots do not have a clue of what you are talking about. If they could fly as well as they could hate I would be impressed.

 

[Britpilot]

Profit = Profit. I dont care if we get it by selling girl scout cookies.

No more calls please, we have a winner.
Consistent profit for the entire history of the company, how many airlines can state that? The folks that run SWA know how to make money and in the end, that's what counts.

 

[ivauir]

I was asking a question. If you DIDN'T have the hedges, would you be in the red according to your own numbers? Instead of trying to put me down, answer the question. It is great that you have the hedges, good for you. Answer the question.


Bye Bye--General Lee

Your question has already been answered on this thread. The answer is NO. KelBil and LUV2FLY give pretty solid explanations. Maybe you should ask them to use smaller words, but at least bother reading the rest of the thread before asking questions that have already been addressed. I know that this goes against your MO of just pilling on anything negative you can about SWA regardless of truth or relevance, but try it for a change ...