About these ads

Tag Archives: Boeing 737-700

WestJet selects Global Eagle Entertainment for its inflight entertainment content

WestJet (Calgary) like other airlines, is overhauling its inflight entertainment system. The carrier has selected Global Eagle Entertainment to provide the inflight content. GEE issued this statement:

Global Eagle Entertainment Inc., a worldwide leading provider of content, connectivity and digital media solutions to airlines, today announced that it has been selected by WestJet to manage its inflight content services.

WestJet is currently overhauling its existing inflight entertainment (IFE) system and replacing it with a wireless IFE solution. Global Eagle Entertainment (GEE) will provide a broad array of content that can be accessed by passengers using their personal electronic devices or tablets rented from the airline. Through this long-term agreement, GEE will provide a selection of current movies and television, including a wide catalog of engaging and entertaining programs, beginning in the first quarter of 2015.

Copyright Photo: Bruce Drum/AirlinersGallery.com. Boeing 737-7CT C-FWCC (msn 32752) prepares to touch down in Las Vegas.

WestJet aircraft slide show: AG Slide Show

AeroMexico to launch Mexico City-Toronto flights

AeroMexico (Mexico City) has announced that it will offer a new daily flight between Toronto (Pearson) and Mexico City as of May 4, 2015, becoming the second destination it serves in Canada.

The new route will be operated with Boeing 737-700 aircraft configured with 124 passenger seats, including 12 seats in Clase Premier —the Aeromexico Business Class cabin.

Copyright Photo: Michael B. Ing/AirlinersGallery.com. Boeing 737-752 XA-GMV (msn 35118) promoting Los Cabos as a destination, arrives in Los Angeles.

AeroMexico aircraft slide show:

About these ads

AeroMexico is coming to Boston

AeroMexico (Mexico City) will add the Mexico City-Boston route on June 1, 2015. The new route will be operated six days a week with Boeing 737-700 aircraft per Airline Route.

Copyright Photo: Jay Selman/AirlinersGallery.com. Boeing 737-752 XA-GOL (msn 35785) with the special Fight Against Breast Cancer markings arrives in Miami.

AeroMexico aircraft slide show:

 

AeroMexico to add a new route to Panama City on May 14, 2015

AeroMexico (Mexico) on May 14, 2015 will add a new route between Mexico City and Panama City, making Panama City its 16th destination in Latin America.

This new route will be serviced by Boeing 737-700 aircraft with seating capacity for 124 passengers -12 in Clase Premier (Aeromexico’s First Class).

Copyright Photo: James Helbock/AirlinersGallery.com. Boeing 737-752 XA-MAH (msn 35122) with the special “Disney Planes” logo arrives in Los Angeles.

AeroMexico aircraft slide show:

AG Slide Show

SAS and Etihad Airways announce a codeshare agreement

Scandinavian Airlines-SAS (Stockholm) has announce a new codeshare agreement with Etihad Airways (Abu Dhabi). Etihad Airways is building an alliance of carriers.

Here is the official announcement:

SAS and Etihad Airways, the national airline of the United Arab Emirates, are set to begin codeshare operations and provide customers with enhanced travel options between Scandinavia and the UAE.

The agreement, which is subject to regulatory approval, will strengthen both carriers by enabling them to offer greater connectivity to and from a number of key European cities. SAS is Etihad Airways’ 47th airline partnership globally and its 22nd in Europe. For SAS, Etihad is the 23rd codeshare partner and the third with strong presence in the Middle East.

Both airlines will also develop and sign a Frequent Flyer agreement, which will benefit the members of Etihad Airways’ Etihad Guest and SAS’ EuroBonus loyalty programs.

The deal will see SAS place its SK code on Etihad Airways’ flights between Abu Dhabi and Brussels, Düsseldorf, Frankfurt, Rome, Milan, Zurich, Geneva and London Heathrow.

In turn, Etihad Airways will place its EY code on SAS-operated flights from these European destinations, excluding Brussels, onto SAS’ hubs in Copenhagen, Oslo, and Stockholm.

The EY code will also be placed on flights beyond Copenhagen to Billund and Ålesund; beyond Oslo to Ålesund, Kristiansand, Trondheim, and Stavanger; and beyond Stockholm to Umeå, Sundsvall, and Östersund.

Top Copyright Photo: SPA/AirlinersGallery.com. SAS’ Boeing 737-705 LN-TUF (msn 28222) arrives in London (Heathrow).

Scandinavian Airlines aircraft slide show: AG Slide Show

Etihad Airways aircraft slide show: AG Slide Show

Bottom Copyright Photo: Gerd Beilfuss/AirlinersGallery.com. Another view of Etihad Airways’ first Airbus A380 at Hamburg (Finkenwerder). The pictured A380-861 F-WWSS (msn 166) will become A6-APA on delivery.

Sun Country to fly twice-weekly Fort Myers-San Juan flights next summer

Sun Country Airlines (Minneapolis/St. Paul) will operate twice-weekly flights between Fort Myers, Florida and San Juan, Puerto Rico from May 3 through August 23, 2015. The seasonal non-hub route will be operated with Boeing 737-700 aircraft per Airline Route.

Copyright Photo: James Helbock/AirlinersGallery.com. Boeing 737-73V N711SY (msn 30245) completes the final approach to the runway at Las Vegas.

Sun Country Airlines aircraft slide show:

Current Route Map:

Sun Country 11.2014 Route Map

Boeing delivers the first direct purchase 737-700 to Ruili Airlines

Boeing (Chicago, Seattle and Charleston) on Saturday (November 22) handed over the first direct purchase 737-700 to Ruili Airlines (Kunming), the pictured 737-7ME B-5829 (msn 60460). The new airliner departed Boeing Field in Seattle on the same day for its long journey to Kunming, China. Today, Boeing issued this announcement on the arrival in Kunming:

Boeing and Ruili Airlines today (November 25) celebrated the arrival of the airline’s first direct purchase Next-Generation 737-700. Ruili is a newly established private airline based at Changshui International Airport in Kunming, the capital city of China’s Yunnan province.

The new airplane is the first of 14 737 orders and commitments from Ruili Airlines, including eight 737-700s and six 737 MAXs. The carrier currently operates two 737-700s and one 737-800 serving seven domestic routes in China.

Ruili Airlines obtained its public air transport enterprise business license from the Civil Aviation Administration of China (CAAC) in February 2014, marking the formal establishment of the carrier. The start-up airline is the first private carrier approved by CAAC after the regulator relaxed restrictions on new carriers in 2013. According to its development plan, Ruili Airlines plans to increase its fleet to 30 Boeing airplanes by 2020, with around 120 daily flights on 60 to 70 routes.

Copyright Photo: Steve Bailey/www.vrefphotos.com/AirlinersGallery.com. A beautiful capture of the new B-5829 at Boeing Field in Seattle.

Southwest Airlines’ pilots file for mediation with the NMB

Southwest Airlines Pilots’ Association-SWAPA (Dallas), representing the pilots of Southwest Airlines (Dallas), filed for mediation with the National Mediation Board (NMB). The union issued this statement:

SWAPA logo

In order to facilitate movement in contract negotiations, the Southwest Airlines Pilots’ Association (SWAPA) today officially filed for mediation with the National Mediation Board (NMB), the federal agency that oversees contract negotiations in the airline industry. After two-plus years of negotiations both sides are currently too far apart to realistically expect an agreement outside of a mediated process.

“This is certainly not a step either side wants to take during negotiations, and certainly not a typical step in the pilot and management relationship at Southwest Airlines,” said Mark Richardson, SWAPA President. “But times have certainly changed.”

SWAPA has focused their negotiations on improvements in areas that address the airline’s flat fleet growth, stagnant career advancement, and compensation. Over the past four years the pilots have sacrificed when asked by the Company. This facilitated Southwest reaching their financial goals, including a stated goal of 15 percent ROIC. Those goals have been accomplished, and furthered, with an announced ROIC total of 19 percent for the trailing 12 months, and a Wall Street expected 21 percent ROIC for fiscal year 2014. Southwest Airlines is on pace to enjoy almost $2.5 billion in operating profit for 2014.

“Our asks continue to be reasonable so that our highly productive pilots can enjoy marginal improvements in their schedule, pay, and especially retirement – an area where Southwest pilots lag significantly compared to our peers at other airlines,” continued Richardson. “Filing for mediation is the next step in the process toward a new contract. We are trying to avoid the destructive and combative relationships that have plagued our industry.”

SWAPA becomes the third Southwest Airlines labor group to request national mediation in order to finalize a new contract in this current round of negotiations.

Located in Dallas, Texas, the Southwest Airlines Pilots’ Association (SWAPA) is a non-profit employee organization representing the more than 7,500 pilots of Southwest Airlines and 500 pilots of AirTran Airways. SWAPA works to provide a secure and rewarding career for Southwest pilots and their families through negotiating contracts, defending contractual rights and actively promoting professionalism and safety. For more information on the Southwest Airlines Pilots’ Association, visit http://www.swapa.org.

Copyright Photo: Copyright Photo: Michael B. Ing/AirlinersGallery.com. Boeing 737-76N N7705A (msn 32744) arrives in Los Angeles.

Southwest Airlines aircraft slide show: AG Slide Show

WestJet reaches a tentative agreement with the WestJet Pilot Association

WestJet (Calgary) has announced it has reached a tentative agreement with its more than 1,200 pilots, represented by the WestJet Pilot Association (WJPA). The agreement’s highlights will be available in early December and voting will begin later in the month.

The WJPA and WestJet leadership teams began negotiations in September 2014 to develop a tentative agreement to replace the previous agreement, which has been in place since May 2009.

Copyright Photo: Michael B. Ing/AirlinersGallery.com. Boeing 737-7CT C-GWBN (msn 34155) arrives in Los Angeles.

WestJet aircraft slide show: AG Slide Show

Gol’s third quarter net loss widens to $95.2 million

Gol Linhas Aéreas Inteligentes S.A. (Gol Transportes Aereos) (Sao Paulo) reported a third quarter net of BRL 245.1 million ($95.2 million), a notable larger loss than BRL 197 ($76.5 million).

The company issued this full CEO report:

Highlights:

Operating income (EBIT) registered R$ 152 million in 3Q14, R$ 115 million up over 3Q13, with an operating margin (EBIT) of 6.2%, up by 4.5 percentage points. The last twelve months (LTM) EBIT totaled R$ 497 million, with an operating margin of 4.9%.

Net revenue reached R$ 2.5 billion, 10% up over the 3Q13, of which R$ 2.2 billion refers to passenger revenues. Net revenue from cargo and others totaled R$ 272 million, increasing its share from 8% in 3Q13 to 11% of the total revenue. Net revenue LTM stood at R$ 10 billion, a new record, with international revenue accounting for 11% of total revenues, reaching R$ 1.1 billion.

EBITDAR totaled R$ 463 million, 24% up on 3Q13. The EBITDAR LTM came to a record registering R$ 1.9 billion, reducing the financial leverage ratio (adjusted gross debt/EBITDAR) by 4.6 points, from 10.9x in 3Q13, to 6.3x in 3Q14.

Total load factor increased by 8 percentage points to 77.5% in the quarter. This increase more than compensates the 2% decline in yield. As a result, RASK and PRASK increased by 13% and 9% over 3Q13, respectively.

Total CASK grew 7% over 3Q13, while CASK ex-fuel increased by 10%. As RASK moved up 3 percentage points above the CASK ex-fuel, GOL maintained its margin expansion in the quarter reflecting its focus on controlling the manageable costs and increasing revenue.

GOL continued its liability management initiatives in the quarter, which aims to optimize the amortization schedule and reduce the Company’s cost of debt. GOL concluded two senior notes tender offer, totaling US$ 411 million, besides the new issuance of US$ 325 million in bonds due to 2022, at a rate of 8.875%. Its subsidiary Smiles S.A. also concluded a R$ 600 million debenture issuance to finance part of its capital reduction.

In the 3Q14, we recorded operating income (EBIT) of R$ 152 million, an expansion of R$ 115 million when compared to the same period last year, while the EBIT margin moved up 4.5 percentage points registering 6.2%. This was the seventh consecutive quarterly improvement in this indicator, reflecting the continuity and consistent delivery on our results.

Net revenue in the last 12 months totaled R$ 10 billion, a new record, even in a scenario of soft economic growth. GOL’s demand for seats (RPK) grew by 8.3% year over year in the first nine months, representing 53% of the industry’s growth, which reflects the greater attractiveness of our products and services. Domestic supply, however, fell by 2.9%, demonstrating the rationalization strategy that the Company took in place since April 2012. From January to September, 2014, we were the market leader in terms of passengers boarded in the domestic market, reaching the record mark of 27.5 million.

In order to offer greater connectivity, we launched during this quarter two new regional destinations on the domestic market, Carajás and Altamira (Pará), as well as new international flights to Santiago (Chile) from Guarulhos (São Paulo), Miami from Campinas, and to Punta Cana from Guarulhos (São Paulo), Confins (Minas Gerais) and Brasília. In this way, we are the Brazilian airline with the greater supply to the Caribbean, with 78 weekly flights.

The strategy of increasing our international presence has been further reinforced by the expansion of our alliances. This has also strengthened revenue in other currencies, which accounted for 11% of our total revenue in the last 12 months. We implemented a two-way codeshare partnership with Aerolineas Argentinas, allowing us to sell its tickets on our website. We will shortly begin offering the same facility for AirFrance-KLM flights.

In order to ensure an even better flying experience, we extended our GOL+ Conforto seating to our entire domestic route network, with an even greater reclining angle and even more distance between seats. Currently, 94% of our fleet is configured as GOL+ and, by the end of the year, 100% of our fleet will have this configuration. In the third quarter, we also launched an exclusive service in Brazil, our express bag drop service at Congonhas airport. With this new service, the customers can complete one more check-in stage at the self-service totems, labeling and weighing their own baggage, as well as paying for any excess. This is one more simple and intelligent innovation providing our passengers with even greater control and visibility throughout the entire process, since the ticket purchase to the flight.

These new facilities have strengthened our capacity to ensure an even better flying experience for leisure passengers, and to be more attractive to the corporate client. Even in the midst of a challenging economic scenario in Brazil, resulting in reduced demand from corporate customers, GOL was the airline company leader in tickets issued for the corporate segment, according to Abracorp (Brazilian Travel Agents’ Association).

Continuing with our measures to strength our balance sheet, we concluded two senior notes tender offers totaling US$ 411 million. Also, we concluded a senior notes issuance this quarter, totaling US$ 325 million at 8.875% p.a. due on 2022. These actions aim to optimize the debt profile, avoiding major amortization pressure in the next three years and reduce the financial cost. We closed the quarter with R$ 2.7 billion in cash position, equivalent to 27% of revenue in the last 12 months, which is essential to pass through periods of high market volatility. The financial leverage ratio (adjusted gross debt/EBITDAR) stood at 6.3x, 4.6 points down on 3Q13.

I would like to thank our customers for their loyalty, our Team of Eagles for their commitment and investors for their confidence posted on the Company. We celebrated on September 8, 2014 in the New York Stock Exchange (NYSE) the 10-year listing of GOL, in which we reiterated our commitment to the transparency and communication with our shareholders, which reinforces our vision of being the best company to fly with, work for and invest in.

Paulo Sérgio Kakinoff

CEO of GOL Linhas Aéreas Inteligentes S.A.

Copyright Photo: Marcelo F. De Biasi/AirlinersGallery.com. Gol’s Boeing 737-7Q8 PR-GIL (msn 30635) approaches the runway at Sao Paulo (Guarulhos).

Gol aircraft slide show:

United Airlines to restore the Denver-Miami route

United Airlines (Chicago) will restore the Denver-Miami route on December 19 per Airline Route.

Copyright Photo: TMK Photography/AirlinersGallery.com. Boeing 737-724 N21723 (msn 28790) taxies at Toronto (Pearson).

Video:

United Airlines aircraft slide show: AG Slide Show

SAS to launch new nonstop European routes starting on March 29, 2015

Scandinavian Airlines-SAS (Stockholm) is opening six new nonstop routes from Scandinavian airports to major European cities, two of which are completely new routes: for the first time, SAS customers can fly to Salzburg and Ankara with SAS for their summer vacation.

Ankara, capital and second-largest city in Turkey, will be the second Turkish destination served by SAS, Gazipasa near Alanya being the first.

As well as launching nine new summer routes, including a new inter-Scandinavian route between Bergen and Gothenburg, SAS is adding more frequencies on inter-Scandinavian routes in winter 2014/2015 and will continue to do so into summer 2015. This includes more nonstop flights between Stavanger and Trondheim and between Bergen and Ålesund. The Copenhagen-Gothenburg route is getting two additional daily departures, bringing the total to eight in the summer timetable. The Stockholm-Gothenburg route is also getting a new morning departure on Mondays in both directions.

In addition to the new routes, SAS is also re-opening its popular 2014 holiday destinations in the 2015 summer timetable to popular destinations such as Chania, Palermo and Pisa.

Timetables for new routes:

Denmark

- Copenhagen-Edinburgh: Departures on Monday, Wednesday, Thursday, Saturday and Sunday, with daily departures in the summer peak season. First departure March 29, 2015.
– Copenhagen-Ankara: Departure on Saturday, and on Monday and Wednesday in the summer peak season. First departure April 04, 2015.

Sweden

- Stockholm-Budapest: Departures on Tuesday, Thursday, Saturday and Sunday. No departures in the summer peak season. First departure March 29, 2015.
– Stockholm-Faro: Departure on Saturday, and on Wednesday in the summer peak season. First departure April 04, 2015.
– Stockholm-Ankara: Departure on Tuesday. First departure June 30, 2015.
– Gothenburg-Alanya (Gazipasa): Departure on Wednesday. First departure July 01, 2015.
– Gothenburg-Dublin: Departure on Saturday, and on Wednesday and Sunday in the summer peak season. First departure April 04.

Norway

- Oslo-Salzburg: Departure on Saturday. First departure May 23.
– Bergen-Gothenburg: Departures on Monday, Wednesday and Friday. No departures in the summer peak season. First departure March 30.

Timetables for expanded and re-opened routes

Expansion of inter-Scandinavian routes

Copenhagen-Gothenburg: Increased from six to eight daily departures
Oslo-Bergen: Up to 16 daily departures
Stavanger-Trondheim: More direct flights
Bergen-Ålesund: More direct flights
Stockholm-Gothenburg: New morning departure in both directions.
Stockholm-Luleå: Increased from seven to nine departures in both directions on Sunday.

Re-opened peak summer routes

Denmark

From Copenhagen to Dubrovnik, Split, Pula, Montpellier, Biarritz, Chania, Thessaloniki, Palermo, Napoli, Pisa, Gazipasa and Alicante.
From Billund, the route to Gazipasa in Turkey is re-opening.

Norway

From Trondheim to Malaga and Barcelona.
From Bergen to Split, Dubrovnik, Nice, Malaga, Barcelona and Alanya (Gazipasa).
From Stavanger to Split, Nice, Malaga, Barcelona and Alanya (Gazipasa).
From Kristiansand to Split.
From Oslo to Dubrovnik, Pula, Olbia, Pisa, Palermo and Pristina.

Sweden

From Gothenburg to Pula, Nice, Athens, Pristina, Alicante and Palma de Mallorca.
From Stockholm to Chania, Cagliari, Olbia, Biarritz, Palermo, Pisa, Pristina, Bristol and Bodø.

Copyright Photo: Paul Bannwarth/AirlinersGallery.com. Boeing 737-783 LN-RPK (msn 28317) arrives at Zurich.

SAS Aircraft Slide Show: AG Slide Show

Southwest Airlines today introduces Beats Music on this WiFi-enabled and marked Boeing 737-700

Southwest Airlines introduces Beats Music on WiFi-enabled aircra

Southwest Airlines (Dallas) today (November 3) introduced Beats Music on its WiFi-enabled aircraft. The airline issued this statement:

Southwest Airlines is giving Customers a new reason to pack their headphones! Beginning today, Beats Music is providing a uniquely curated music experience onboard Southwest Airlines WiFi-enabled aircraft.

Customers accessing Beats Music onboard have an opportunity to listen to wide-ranging music programming in pop, rock, country, and other genres to hear fresh new artists and the hottest songs, which are handpicked by Beats Music expert curators. Accessing the service inflight is on the house and includes a library of hundreds of playlists. Not sure what to listen to, but feel like Jet-Setting with your BFF to Pop? The Sentence offers a continuous playlist just for you, customized by your response to four questions about location, activity, surroundings, and musical preference.

The new entertainment service was introduced today at a live demonstration onboard the official Beats Music-decaled Boeing 737 aircraft (above and below).

Southwest Airlines introduces Beats Music on WiFi-enabled aircra

 

To celebrate, a special playlist was created that will come to life with live concerts from a couple of the artists on select Southwest flights at 35,000 feet! The official Beats Music aircraft is planned to depart from Dallas Love Field to Chicago-Midway on flight 732 with Cobra Starship onboard. Customers on this flight will get a Southwest Airlines VIP backstage pass to the most elevated live concert they’ve ever experienced, with an opportunity to meet and receive autographs from the band. Southwest Airlines also is celebrating with Customers on Flight 1527 with Elephant Revival, flying from Portland to Denver.

Beats Music is a music subscription service that combines expert curation with the best technology, so you get music that’s right for you every time. Customers can stream a selection of Beats Music playlists through the Southwest entertainment portal, which is powered by Global Eagle Entertainment Inc., using their personal electronic devices onboard Southwest Airlines WiFi-enabled aircraft. Global Eagle Entertainment is a worldwide provider of media content, technology, and connectivity solutions to the travel industry. Through the industry’s most comprehensive product and services platform, Global Eagle Entertainment provides airlines with a wide range of inflight solutions including WiFi, movies, television, music, interactive software, as well as portable IFE solutions, content management services, e-commerce solutions, and original content development.

The service provided on the Southwest entertainment portal will be compatible with major mobile devices and operating systems, including iOS and Android, as well as most web browsers, and is designed to ensure a seamless and superior quality playback.

Copyright Photos: Southwest Airlines’ Boeing 737-7H4 N909WN (msn 32458) is the first aircraft to wear the special Beats Music markings.

Southwest Airlines Aircraft Slide Show: AG Slide Show

Southwest Airlines introduces Beats Music on WiFi-enabled aircra

Video: Southwest’s executives celebrate Halloween:

WestJet today launches seasonal Winnipeg-Fort Lauderdale/Hollywood flights

WestJet (Calgary) today launched new weekly, seasonal, nonstop service between Winnipeg and Fort Lauderdale/Hollywood, Florida. Flights out of the Winnipeg James Armstrong Richardson Airport operate every Saturday until April 25, 2015.

Copyright Photo: Michael B. Ing/AirlinersGallery.com. Boeing 737-7CT C-FEWJ (msn 32769) arrives in Los Angeles.

WestJet: AG Slide Show

Ethiopian Airlines to start a new route to Doha, Qatar on December 2

Ethiopian Airlines (Addis Ababa) has announced it will launch a new route from Addis Ababa to Doha, Qatar on December 2. The new route will operate three days a week with Boeing 737s.

This will bring the total number of international destinations across five continents to 84. The city will mark the 10th Ethiopian destination to the Middle East.

Convenient connections will be available to and from cities such as Johannesburg, Nairobi, Kinshasa, Lagos, Accra, Dakar, Dar-es-Salaam and Entebbe.

Copyright Photo: Arnd Wolf/AirlinersGallery.com. Boeing 737-760 ET-ALM (msn 33765) taxies at Munich.

Ethiopian Airlines Aircraft Slide Show:

Kunming Airlines commits to four Boeing Next-Generation 737-700s and six 737 MAX aircraft

Kunming Airlines (Changshui) has committed to purchase 10 Boeing 737s, including four Next-Generation 737-700s and six 737 MAX airplanes.

The commitment, valued at $897 million at current list prices, is subject to the approval of the Chinese government and will be posted on Boeing’s Orders & Deliveries website once all contingencies are cleared.

Kunming Airlines, based at Changshui International Airport in the capital city of Yunnan province, began operations in 2009. The carrier currently serves more than 25 cities across China by operating a fleet of 10 Boeing 737-700s and five 737-800s.

Copyright Photo: Ivan K. Nishimura/AirlinersGallery.com. The larger Boeing 737-87L B-1926 (msn 41111) taxies at Honolulu.

 

Southwest Airlines reports a record third quarter net profit

Southwest Airlines Company (Southwest Airlines and AirTran Airways) (Dallas) today reported its third quarter 2014 results:

Record third quarter net income, excluding special items1, of $382 million, or $.55 per diluted share, compared to third quarter 2013 net income, excluding special items, of $241 million, or $.34 per diluted share. This represented a 61.8 percent increase from third quarter 2013, and exceeded the First Call consensus estimate of $.53 per diluted share.

Record third quarter net income of $329 million, or $.48 per diluted share, which included $53 million (net) of unfavorable special items, compared to third quarter 2013 net income of $259 million, or $.37 per diluted share, which included $18 million (net) of favorable special items.

Record third quarter operating income of $614 million. Excluding special items, record third quarter operating income of $649 million.
Returned $241 million to Shareholders through dividends and share repurchases.

Return on invested capital1, before taxes and excluding special items (ROIC), for the twelve months ended September 30, 2014, of 19.0 percent, as compared to 10.6 percent for the twelve months ended September 30, 2013.

Gary C. Kelly, Chairman of the Board, President, and Chief Executive Officer, stated, “We are very pleased to report another record quarterly profit performance, which resulted in a $100 million third quarter 2014 profitsharing expense for our Employees. Excluding special items, third quarter 2014 net income was $382 million, or $.55 per diluted share, and operating income was $649 million, resulting in a 13.5 percent operating margin2. The 386 basis point year-over-year improvement in operating margin, excluding special items, was driven by strong revenues, lower jet fuel prices, and a solid cost performance.

“Total operating revenues were $4.8 billion, which was a 5.6 percent increase from a year ago, despite a four percent decline in trips and two percent fewer seats flown3, as we work through the transition of AirTran aircraft. Our traffic and revenue trends were strong throughout the third quarter, generating a 4.5 percent year-over-year increase in unit revenues, despite a large percentage of our route system in development or conversion as we continued to transition AirTran flying to Southwest. Our third quarter 2014 revenue strength was driven by record load factors and a strong performance in our Rapid Rewards frequent flyer program. Thus far, revenue momentum has continued into October 2014, with favorable load factor and unit revenue trends. Current bookings for November and December are also good.

“Our third quarter 2014 cost performance benefited from lower jet fuel prices and our fleet modernization efforts. With these trends continuing, we are poised for another solid cost performance for fourth quarter 2014. Based on current cost trends, and excluding fuel and oil expense, profitsharing, and special items, we expect full year 2014 unit costs to increase approximately two percent compared to last year.

“Our third quarter 2014 financial performance was very gratifying, and I commend our outstanding Employees of Southwest Airlines for their unending dedication to providing reliable, low cost operations with our legendary, friendly Customer Service. As an industry leader of low fares and low costs, we are very pleased with the transformative and successful execution of our strategic initiatives that contributed significantly to our 19.0 percent ROIC for the twelve months ended September 30, 2014. Our Employees are the very best in the airline industry, and we were thrilled to unveil a bold, new visual expression of our brand in September. Our Heart aircraft livery, airport experience, and logo marries our past to our present and commemorates the transformation of Southwest in 2014. It is dedicated with much gratitude to our People.

“We are also thrilled with the July 1, 2014, launch of Southwest international service. During third quarter, we began service to Oranjestad, Aruba; Montego Bay, Jamaica; Nassau/Paradise Island in the Bahamas; and San Jose del Cabo/Los Cabos and Cancun, Mexico, all markets previously served by AirTran Airways. Next month, we will initiate Southwest service to Punta Cana, Dominican Republic, and Mexico City, which will complete the conversion of international service from AirTran to Southwest. Also during third quarter, we announced that our first destination in Central America will be Juan Santamaria International Airport in San Jose, Costa Rica. The inauguration of this service is expected to be on March 7, 2015, subject to government approval.

“October 13, 2014, was a momentous day for Southwest Airlines. After 34 years, we are finally free from the Wright Amendment restrictions4, and have proudly launched our initial nonstop offerings from Dallas Love Field to seven popular destinations, with ten more nonstop destinations, previously announced, on the horizon.

“In addition to our strong third quarter 2014 earnings performance, our balance sheet, liquidity, and cash flows support our commitment to maintain our financial strength so that we can continue to take great care of our Employees, Customers and Shareholders. At the end of third quarter 2014, we had $3.6 billion in cash and short-term investments. For the nine months ended September 30, 2014, net cash provided by operations was $2.7 billion, and capital expenditures were $1.3 billion, resulting in strong free cash flow1 of $1.4 billion. We have further strengthened our balance sheet and repaid $517 million in debt and capital lease obligations, thus far in 2014, including $167 million in debt and capital lease obligations repaid during the nine months ended September 30, 2014, and $350 million repaid on October 1st. Thus far this year, we have returned $893 million to Shareholders through the payment of $138 million in dividends and the repurchase of $755 million in common stock.”

Financial Results and Outlook

The Company’s third quarter 2014 total operating revenues increased 5.6 percent, while operating unit revenues increased 4.5 percent, on a 1.1 percent increase in available seat miles, all as compared to third quarter 2013. Third quarter 2014 passenger revenues were $4.6 billion, which was an increase of 4.9 percent on a unit basis, as compared to third quarter 2013.

Total operating expenses in third quarter 2014 increased 0.7 percent to $4.2 billion, as compared to third quarter 2013. Third quarter 2014 profitsharing expense was $100 million, compared to $69 million in third quarter 2013. The Company incurred costs (before profitsharing and taxes) associated with the acquisition and integration of AirTran, which are special items, of $23 million during third quarter 2014, compared to $28 million in third quarter 2013. Cumulative costs associated with the acquisition and integration of AirTran, as of September 30, 2014, totaled $488 million (before profitsharing and taxes). The Company expects total acquisition and integration costs to be approximately $550 million (before profitsharing and taxes). Excluding special items in both periods, total operating expenses in third quarter 2014 increased 1.1 percent to $4.2 billion, as compared to third quarter 2013.

Third quarter 2014 economic fuel costs were $2.94 per gallon, including $.05 per gallon in favorable cash settlements from fuel derivative contracts, compared to $3.06 per gallon in third quarter 2013, including $.01 per gallon in favorable cash settlements from fuel derivative contracts. Based on the Company’s fuel derivative contracts and market prices as of October 17, 2014, fourth quarter 2014 economic fuel costs are expected to be in the $2.70 to $2.75 per gallon range, compared to fourth quarter 2013’s $3.05 per gallon. As of October 17, 2014, the fair market value of the Company’s hedge portfolio through 2018 was a net liability of $236 million. Additional information regarding the Company’s fuel derivative contracts is included in the accompanying tables.

Excluding fuel and oil expense, profitsharing, and special items in both periods, third quarter 2014 operating costs increased 2.6 percent from third quarter 2013, and increased 1.5 percent on a unit basis.

Operating income in third quarter 2014 was $614 million, compared to $390 million in third quarter 2013. Excluding special items, operating income was $649 million in third quarter 2014, compared to $439 million in the same period last year, a 47.8 percent increase year-over-year.

Other expenses in third quarter 2014 were $89 million, compared to other income of $29 million in third quarter 2013. The $118 million swing primarily resulted from $66 million in other losses recognized in third quarter 2014, compared to $59 million in other gains recognized in third quarter 2013. In both periods, these gains/losses included ineffectiveness and unrealized mark-to-market amounts associated with a portion of the Company’s fuel hedging portfolio, which are special items. Excluding these special items, third quarter 2014 had $16 million in other losses, compared to $19 million in third quarter 2013, primarily attributable to the premium costs associated with the Company’s fuel derivative contracts. Fourth quarter 2014 premium costs related to fuel derivative contracts are currently estimated to be $13 million, compared to $22 million in fourth quarter 2013. Net interest expense in third quarter 2014 was $23 million, compared to $30 million in third quarter 2013.

For the nine months ended September 30, 2014, total operating revenues increased 5.3 percent to $14.0 billion, and total operating expenses were $12.4 billion, resulting in operating income of $1.6 billion, compared to $893 million in operating income for the same period last year. Excluding special items, operating income was $1.7 billion for the nine months ended September 30, 2014, compared to $1.0 billion for the same period last year. Net income for the nine months ended September 30, 2014, was $946 million, or $1.36 per diluted share, compared to $542 million, or $.75 per diluted share, for the same period last year. Excluding special items, net income for the nine months ended September 30, 2014, was $993 million, or $1.42 per diluted share, compared to $569 million, or $.79 per diluted share, for the same period last year.

Balance Sheet and Cash Flows

As of September 30, 2014, the Company had $3.6 billion in cash and short-term investments, and a fully available unsecured revolving credit line of $1 billion. Net cash provided by operations during third quarter 2014 was $240 million, and capital expenditures were $433 million. The Company repaid $48 million in debt and capital lease obligations during third quarter 2014, and intends to repay an additional $395 million in debt and capital lease obligations during fourth quarter 2014, including $350 million repaid on October 1, 2014.

During third quarter 2014, the Company returned $241 million to its Shareholders through the payment of $41 million in dividends and the repurchase of $200 million in common stock, or 5.0 million shares, pursuant to an accelerated share repurchase (ASR) program executed during the quarter. This ASR program was completed in early October, and the Company then received an additional 1.1 million shares, bringing the total shares repurchased under the third quarter 2014 ASR program to 6.1 million. During third quarter, the Company also received the remaining 1.4 million shares pursuant to the second quarter 2014 $200 million ASR program, bringing the total shares repurchased under that ASR program to 7.4 million. Thus far in 2014, the Company has returned $893 million to its Shareholders through $138 million in dividends, and the repurchase of $755 million in common stock, or 29.2 million shares. The Company has $580 million remaining under its existing $1 billion share repurchase authorization.

Fleet

During third quarter 2014, the Company’s fleet increased by two to 685 aircraft at period end. This reflects the third quarter 2014 delivery of 11 new Boeing 737-800s and two pre-owned Boeing 737-700s, as well as the retirement of one Boeing 737-500. In addition, the Company removed ten Boeing 717-200s from service during third quarter 2014 in preparation for transition out of the fleet.

Boeing 737 Delivery Schedule:

Southwest 737 Delivery Schedule 9.30.14

Copyright Photo: Eddie Maloney/AirlinersGallery.com. Boeing 737-7H4 N909WN (msn 32458) arrives at Las Vegas.

Southwest Airlines Aircraft Slide Show: AG Slide Show

AirTran Airways Aircraft Slide Show: AG Slide Show

Southwest Airlines and the IAM reach a tentative agreement

Southwest Airlines (Dallas) and the International Association of Machinists and Aerospace Workers (IAM), representing the carrier’s approximately 6,000 Customer Service Agents and Customer Support and Services Representatives, announced today the two parties have reached a tentative agreement. The tentative agreement is for a new four year contract and requires Membership ratification. The current contract became amendable in October 2012.

In the upcoming weeks, the IAM membership will be given the full details of the agreement and have the opportunity to vote on ratification.

Copyright Photo: Michael B. Ing/AirlinersGallery.com. Southwest’s Boeing 737-7H4 N708SW (msn 27842) in the new “Heart” livery arrives at Los Angeles International Airport (LAX).

Southwest Aircraft Slide Show: AG Slide Show

Alaska Airlines renews its jersey sponsorship with the Portland Timbers

Alaska Airlines (Seattle/Tacoma) will continue to sponsor the professional soccer team Portland Timbers. The airline issued this statement:

The Portland Timbers has announced the club has renewed its jersey sponsorship with Alaska Airlines. As part of the multiyear partnership, the iconic Northwest airline’s wordmark will continue to be prominently featured on Timbers’ game kits and club apparel.

In addition to being featured on Timbers jerseys, Alaska Airlines will continue to serve as the team’s official airline. Alaska Airlines, a Founding Partner of the Timbers, has been the club’s jersey partner since its inaugural 2011 MLS season.

As part of the partnership, Alaska Airlines will continue to support the Portland Timbers Community Fund, partnering with the team on several youth-based fitness and educational initiatives. Additionally, Alaska Airlines will donate 25 game-day tickets for home games to underprivileged Portland-area youth as part of the Timbers “Tickets for Kids” program. Alaska Airlines also will be a presenting sponsor for all MLS Timbers youth soccer camps.

Among the many fan-friendly components of the uniquely interactive partnership, Alaska Airlines will continue its popular program to allow year-round early boarding privileges on its flights originating from Portland International Airport to fans wearing Timbers jerseys. The airline will continue to fly the popular Timbers Jet throughout its route network. The club-themed plane was unveiled in 2011 with a design inspired by two Timbers fans through a paint-the-plane contest.

Alaska Airlines offers more nonstop flights (serving 43 different destinations), more daily flights (110 a day) and more California service (36 flights daily to 13 California destinations) from Portland International Airport than any other carrier.

Copyright Photo: Bruce Drum/AirlinersGallery.com. The sponsorship also includes a Portland Timbers logo jet. Boeing 737-790 N607AS (msn 29751) taxies at the Seattle-Tacoma International Airport hub.

Alaska Airlines:

AG Slide Show

Alaska Airlines Aircraft Slide Show:

WestJet is coming to Glasgow, Scotland on May 29, 2015

WestJet (Calgary) today announced Glasgow, United Kingdom, as its newest European destination. Daily nonstop flights from Halifax begin on May 29, 2015, with direct (same-aircraft) service from Toronto (Pearson), operated on one of the airline’s Boeing Next-Generation 737-700 series aircraft.

The new route between Halifax and Glasgow will operate seasonally from May 29, 2015 to October 23, 2015.

The Scotland-bound flight, WS 30, was numbered in honor of St. Andrew’s Day, which falls on November 30. WestJet’s second trans-Atlantic route is a five-hour 15-minute journey – only a wee bit longer than the airline’s popular flight from Halifax to Calgary.

WestJet will also resume its service between St. John’s, Newfoundland, and Dublin, Ireland, on May 1, 2015, six weeks earlier than in 2014.

Copyright Photo: Jay Selman/AirlinersGallery.com. WestJet Airlines Boeing 737-7CT WL C-FWSK (msn 36420) arrives in Las Vegas.

WestJet: AG Slide Show

Boeing to increase the monthly 737 production rate to 52 aircraft in 2018

Boeing (Chicago and Seattle) announced today that it will increase production on the 737 program to 52 airplanes per month in 2018 in response to strong market demand from customers worldwide. Once the increase is implemented, the 737 program is expected to build more than 620 airplanes per year, the highest rate ever for the world’s best-selling commercial airplane.

Boeing currently produces 42 airplanes per month at its Renton, Wash., factory, and the company previously announced plans to increase the production rate to 47 airplanes per month in 2017.

The 2014 Current Market Outlook, Boeing’s long-term forecast of air traffic volumes and commercial airplane demand, projects a need for more than 25,000 single-aisle airplanes over the next 20 years, worth $2.56 trillion total market value.

To date, 266 customers worldwide have placed more than 12,100 orders for the single-aisle airplane – including more than 6,800 orders for the Next-Generation 737 and more than 2,200 orders for the 737 MAX. Boeing currently has more than 4,000 unfilled orders across the 737 family.

The production rate increase announced today is not expected to have a significant impact on 2014 financial results.

Copyright Photo: Michael B. Ing/AirlinersGallery.com. Boeing Corporate 737-7BC (BBJ) N835BA (msn 30572) arrives in Los Angeles.

United Airlines to pay its flight attendants $100,000 to leave the company, will recall all furloughed FAs

United Airlines (Chicago) has issued this statement:

United Airlines and the Association of Flight Attendants (AFA) announced that United will offer its Flight Attendants an Enhanced Early Out Program, which allows participants a one-time opportunity to voluntarily separate from the company and receive a severance payment. United also announced that it is recalling all Flight Attendants who are on voluntary and involuntary furlough.

United will offer lump sum payouts of up to $100,000 for Flight Attendants who apply for the early out and meet certain service and eligibility qualifications, and the company will award early outs in seniority order.

“We’re excited to offer this extraordinary early out program, and we look forward to rewarding Flight Attendants who’ve contributed so much to United over the years,” said Sam Risoli, United’s senior vice president, Inflight Services. “Working together with the AFA Master Executive Council Presidents Ken Diaz, Suzanne Hendricks and Marcus Valentino, we were able to develop a program that provides great benefits, minimizes disruption to Flight Attendants due to staffing imbalances and at the same time helps us be more competitive.”

“United’s investment in this Enhanced Early Out benefits United and all our Flight Attendants represented by the AFA,” said Mike Bonds, executive vice president, Human Resources and Labor Relations. “Recalling furloughed Flight Attendants and aligning our staffing to match our flying schedule will further facilitate the company and AFA reaching a joint collective bargaining agreement. It’s another positive step in what has become a productive relationship with AFA.”

United has more than 23,000 flight attendants.

Narita-based Japanese national Flight Attendants employed by CMI, and who are not employed by United or represented by AFA, have their own severance and early-retirement terms provided in their collective bargaining agreement under Japanese law, and therefore are not eligible for the United Airlines Enhanced Early Out Program.

United has achieved joint collective bargaining agreements with a majority of its represented work force, including pilots, dispatchers, fleet service, passenger service, reservations and storekeeper workgroups. The company is engaged in expedited negotiations with the AFA and is in mediation with the International Brotherhood of Teamsters (IBT), representing United’s technicians.

Read the analysis by Bloomberg Businessweek: CLICK HERE

Copyright Photo: Brian McDonough/AirlinersGallery.com. Boeing 737-724 N16709 (msn 28779) departs from Washington’s Reagan National Airport.

United Airlines (Current): AG Slide Show

Southwest Airlines files to serve San Jose, Costa Rica from Baltimore/Washington

Southwest Airlines (Dallas) announced today (September 12) that it has filed an application with the U.S. Department of Transportation (DOT) to add its first destination in Central America with daily roundtrip service between Baltimore/Washington Thurgood Marshall International Airport (BWI) and Juan Santamaria International Airport (SJO) in San Jose, Costa Rica, beginning on March 7, 2015.

Costa Rica will be the sixth near-international country served by Southwest Airlines from its U.S. gateway cities and the first new destination in the carrier’s network after the integration of wholly owned subsidiary AirTran Airways is completed by the end of this year. Service to Punta Cana, Dominican Republic, and Mexico City begins on November 2, as Southwest converts existing AirTran service in those destinations. Southwest began service this summer to Aruba, The Bahamas, Jamaica, and both Cancun and San Jose del Cabo/Los Cabos, Mexico.

Southwest Airlines began service from Baltimore/Washington in September 1993, with ten flights offering scheduled service through nonstop destinations Chicago (Midway) and Cleveland. Southwest, 21 years later, is the largest carrier at BWI in terms of daily departure and, by March 2015, will fly nonstop to 60 cities with more than 200 departures a day.

In October 2006, Southwest began serving Washington Dulles International Airport (IAD) and added service to Ronald Reagan Washington National Airport (DCA) in July 2012. By November, Southwest Airlines will be the second largest carrier at DCA in terms of seats, offering 44 flights a day to 14 destinations: Akron-Canton, Atlanta, Austin, Chicago (Midway), Dallas (Love Field), Ft. Myers/Naples, Houston, Indianapolis, Kansas City, Milwaukee, Nashville, New Orleans, St. Louis, and Tampa.

Top Copyright Photo: Bruce Drum/AirlinersGallery.com. Boeing 737-7H4 N214WN (msn 32486) in the Maryland One scheme arrives in Las Vegas

Southwest Airlines: AG Slide Show

 

AG Banner Taglines 1700 Galleries 1800

Bottom Copyright Photo: Southwest Airlines. The new heart logo is directed too at its employees as it grows internationally and finalizes the AirTran merger.

Southwest Airlines HeartVideo:

 

Southwest’s pilots applaud the DOT decision concerning the application of Norwegian Air International

Southwest Airlines‘ (Dallas) pilots, represented by SWAPA, have issued this statement:

The Southwest Airlines Pilots’ Association (SWAPA) commends the United States Department of Transportation (DOT) for denying Norwegian Air International (NAI) a temporary foreign air carrier operating authorization. NAI is a subsidiary of Norwegian Air which is located in Norway. NAI has sought to operate service to the U.S. as an Irish airline where it has no operating flights or history of operations.

“The denial of a temporary operating authorization is applauded by the pilots of Southwest Airlines,” said SWAPA Governmental Affairs Chair Captain Paul Jackson. “We agree with Secretary Foxx’s assertion that the application of Norwegian Air International is not in the public interest.”

This denial is only for the temporary application and is not a denial of the full application approval for a foreign carrier exemption with the DOT by NAI. The pilots of Southwest Airlines have opposed the application of NAI from early in the process due to the company’s “flag of convenience” strategy that locates the airline away from their home country of Norway. The NAI application for a foreign carrier operating authorization has been on file with the DOT since early this year. It is opposed by airline employees and management across the U.S. and the EU.

“We encourage Norwegian to join the marketplace under the labor laws and rules of their home country and not seek a scheme to avoid them,” Captain Jackson continued. “We strongly believe that our product and the work of our industry can stand up to any competitor if they play by the rules in place and do not seek to lower costs at any price.”

Copyright Photo: Bruce Drum/AirlinersGallery.com. Boeing 737-7H4 N953WN (msn 36668) taxies to the runway at Seattle-Tacoma International Airport.

Southwest Airlines Aircraft Slide Show: CLICK HERE

Southwest to drop three Caribbean routes from Atlanta

Southwest Airlines (Dallas) effective March 1, 2015 will drop two weekly international routes from Atlanta; Aruba and Montego Bay. The company will also drop the Atlanta-San Juan route on March 7, 2015 per Airline Route.

Effective on March 7, 2015 Southwest will add weekly San Antonio-New Orleans service.

Copyright Photo: Ken Petersen/AirlinersGallery.com. Boeing 737-7H4 N436WN (msn 32456) departs from New York’s LaGuardia Airport (LGA).

Southwest Airlines: AG Slide Show

SAS arrives in Houston from Stavanger, Norway

Scandinavian Airlines-SAS (Stockholm)  is now connecting Houston, Texas, with Stavanger in Norway through six days a week nonstop air service. The initiative is expected to significantly strengthen the economic and cultural ties that already exist within the oil and gas industry in the regions. The route will be operated by a business version of the Boeing 737-700 aircraft and will have a SAS Long Haul Business Class concept on board with just 44 comfortable business seats, in-flight entertainment and full-service meals.

Departures from Stavanger will be daily, except Tuesdays, at 4:00 pm arriving in Houston (Bush Intercontinental)  at 7:40 pm (1940) the same day. SAS will depart from Houston to Stavanger daily except Tuesdays at 9:35 pm (2135) arriving the next day in Stavanger at 2.20 pm (1440). SAS will be the only airline with nonstop service between Scandinavia and Houston.

In addition to the Houston-Stavanger route, SAS also operates nonstop service from Newark to Copenhagen, Oslo and Stockholm, from Chicago (O’Hare) to Copenhagen and Stockholm, and from Washington, D.C. and San Francisco to Copenhagen.

Copyright Photo: Stefan Sjogren/AirlinersGallery.com. Boeing 737-705 LN-TUD (msn 28217) arrives at the Stockholm (Arlanda) hub.

SAS: AG Slide Show

Southwest Airlines launches Mexican flights to Cancun and San Jose del Cabo/Los Cabos

Southwest Airlines (Dallas) launched its initial service to Mexico with inaugural flights over the weekend.  The nonstop routes previously served by wholly owned subsidiary AirTran Airways now operate daily between Orange County/Santa Ana and San Jose del Cabo/Los Cabos, Mexico, and between Cancun and both Atlanta and Baltimore/Washington.

Saturday-only service on Southwest between Milwaukee and Cancun begins August 16, 2014.

The Company plans to fully convert all international and domestic service currently flown by AirTran to Southwest by the end of this year. The carriers’ flights schedules are published through March 6, 2015, and are available for purchase at southwest.com.

AirTran Airways continues to operate daily service between Mexico City and Orange County/Santa Ana until the route converts to Southwest Airlines service on Nov. 2, 2014.

Southwest Airlines began international service on July 1 with flights to Oranjestad, Aruba; Montego Bay, Jamaica; and Nassau, The Bahamas, in the Caribbean. International service from Denver begins Oct. 7. Additional international service from Chicago (Midway), Austin, and San Antonio begins Nov. 2, the same day Southwest Airlines begins serving Punta Cana, Dominican Republic*, and Mexico City.

*subject to Government approvals

Copyright Photo: Bruce Drum/AirlinersGallery.com. Boeing 737-7H4 N228WN (msn 32496) departs from Fort Lauderdale-Hollywood International Airport.

Southwest Airlines: AG Slide Show

Southwest Airlines and SeaWorld part ways, Shamu airplanes to be repainted

Southwest Airlines (Dallas) and SeaWorld have issued this joint statement:

“Southwest and SeaWorld have mutually decided not to renew their partnership when the contract expires at the end of the year. Our promotional marketing relationship began in 1988 and was one of the first of its kind – focused on co-marketing opportunities between Southwest passengers and SeaWorld visitors.

The companies decided not to renew the contract based on shifting priorities. Southwest is spreading its wings with new international service, and increased focus on local market efforts. With an increasing international visitor base, SeaWorld is looking to focus on new and growing markets in Latin America and Asia, among others.

The companies will continue to work together through Southwest Vacations. Southwest’s three specialty airplanes will return to the company’s traditional livery.

Southwest and SeaWorld have enjoyed their long relationship, and wish each other continued success.”

Southwest and SeaWorld have both been coming under a lot of public pressure on change.org in the form of a public petition calling for Southwest to separate itself from SeaWorld in the wake of the documentary Blackfish movie which criticized SeaWorld’s on-going procedures concerning the capture, training and containment of its orca whales. The death of a SeaWorld female trainer by an orca in captivity also spurred the release of the movie.

Read the petition: CLICK HERE

SeaWorld logo

SeaWorld responded to the movie Blackfish with this statement: CLICK HERE

Top Copyright Photo: Michael B. Ing/AirlinersGallery.com. The three remaining Shamu specially painted Boeing 737s will be repainted. Boeing 737-7H4 N713SW (msn 27847) arrives in Los Angeles.

Southwest Airlines: AG Slide Show

Bottom Copyright Photo: Ton Jochems/AirlinersGallery.com. The colorful “Penguin One” will also be erased.

Video: Blackfish movie trailer:

Southwest reports record second quarter net income of $485 million

Southwest Airlines Company (Southwest Airlines and AirTran Airways) (Dallas) today reported its second quarter 2014 results:

Record quarterly net income, excluding special items*, of $485 million, or $.70 per diluted share, compared to second quarter 2013 net income, excluding special items, of $274 million, or $.38 per diluted share. This exceeded the First Call consensus estimate of $.61 per diluted share.

Record quarterly net income of $465 million, or $.67 per diluted share, which included $20 million (net) of unfavorable special items, compared to second quarter 2013 net income of $224 million, or $.31 per diluted share, which included $50 million (net) of unfavorable special items.

Record quarterly operating income of $775 million. Excluding special items, record quarterly operating income of $819 million, resulting in a 16.3 percent operating margin**.

Return on invested capital*, before taxes and excluding special items, for the 12 months ended June 30, 2014, of 17.1 percent, as compared to 8.5 percent for the 12 months ended June 30, 2013.

Gary C. Kelly, Chairman of the Board, President, and Chief Executive Officer, stated:

“We are very pleased with our strong second quarter earnings performance. Net income, excluding special items, of $485 million, or $.70 per diluted share, represents our fifth consecutive quarter of record profits. The successful execution of our strategic initiatives continues to contribute significantly to these record profits. Second quarter 2014 total operating revenues reached an all-time quarterly high of $5.0 billion, benefiting from an 8.5 percent year-over-year increase in passenger revenues. Also, we were very pleased with our cost performance. Operating expenses benefited from our strategic initiatives, as well, and were comparable to second quarter last year.

“My hearty congratulations and thanks go to our hard-working and dedicated Employees for our outstanding second quarter results, which resulted in record quarterly profitsharing expense of $127 million. Over the last twelve months, our exceptional earnings performance, combined with our actions to prudently manage our invested capital, produced a 17.1 percent pre-tax return on invested capital, excluding special items (ROIC). This positions us well to meet or exceed our 15 percent pre-tax ROIC target for full year 2014.

“Our network development and optimization efforts continue, and we are very pleased with the performance across our system. Second quarter load factor and passenger revenue yield were records, even with a large percentage of the route system in the conversion or development stage. We announced our initial nonstop offerings from Dallas Love Field with the upcoming sunset of the Wright Amendment restrictions on October 13, and nearly tripled the flights we currently offer at Reagan National Airport, effective November 2 this year. On July 1, we inaugurated international service on Southwest Airlines, with flights to Oranjestad, Aruba; Montego Bay, Jamaica; and Nassau/Paradise Island in The Bahamas. We plan to fully convert AirTran’s remaining international markets and domestic flying by the end of this year. We expect roughly flat 2014 available seat miles, year-over-year, and intend to expand the network in a disciplined manner. For 2015, we currently expect our available seat miles to increase, year-over-year, largely driven by a two to three percent growth in seats from the upgauging of our fleet, along with a higher percentage of our fleet in revenue service post-integration.

“During second quarter, we announced the selection of Amadeus to implement the Altéa reservations solution to support our domestic network, following the successful implementation of Amadeus’ international solution this year. This allows us to replace the legacy reservation system used by Southwest. The AirTran reservation system is expected to be retired at this year’s end.

“Our balance sheet, liquidity, and cash flows remain strong. At the end of second quarter 2014, we had $4.0 billion in cash and short-term investments. For first half 2014, net cash provided by operations was $2.46 billion, and capital expenditures were $907 million, resulting in strong free cash flow* of $1.55 billion. We repaid $119 million in debt and capital lease obligations during first half 2014, and intend to repay an additional $440 million in debt and capital lease obligations in the second half of this year. Thus far this year, we have returned $652 million to Shareholders through the payment of $97 million in dividends and the repurchase of $555 million in common stock. As always, we are committed to maintaining our financial strength and enhancing value to our Shareholders.”

Financial Results and Outlook

The Company’s second quarter 2014 total operating revenues increased 7.9 percent, while operating unit revenues increased 8.4 percent, on a 0.4 percent decrease in available seat miles and a 2.2 percent increase in average seats per trip, all as compared to second quarter 2013. Second quarter 2014 passenger revenues were $4.8 billion, which was an increase of 9.0 percent on a unit basis, as compared to second quarter 2013. A change to previously recorded estimates of tickets expected to spoil in the future resulted in additional passenger revenue of $47 million in second quarter 2014.

Thus far, July passenger revenue trends and bookings are strong. Based on these trends, and considering the strength of the year-ago comparison, the Company expects July 2014 passenger unit revenues to increase in the three percent range, as compared to July 2013.

Total operating expenses in second quarter 2014 increased 0.6 percent to $4.2 billion, as compared to second quarter 2013. Second quarter 2014 profitsharing expense was a record $127 million, compared to $78 million in second quarter 2013. The Company incurred costs (before profitsharing and taxes) associated with the acquisition and integration of AirTran, which are special items, of $38 million during second quarter 2014, compared to $26 million in second quarter 2013. Cumulative costs associated with the acquisition and integration of AirTran, as of June 30, 2014, totaled $466 million (before profitsharing and taxes). The Company expects total acquisition and integration costs to be approximately $550 million (before profitsharing and taxes). Excluding special items in both periods, total operating expenses in second quarter 2014 increased 0.7 percent to $4.2 billion, as compared to second quarter 2013.

Second quarter 2014 economic fuel costs were $3.02 per gallon, including $.05 per gallon in favorable cash settlements from fuel derivative contracts, compared to $3.06 per gallon in second quarter 2013, including $.05 per gallon in unfavorable cash settlements from fuel derivative contracts. Based on the Company’s fuel derivative contracts and market prices as of July 21, 2014, third quarter 2014 economic fuel costs are expected to be in the $2.95 to $3.00 per gallon range, compared to third quarter 2013’s economic fuel costs of $3.06 per gallon. As of July 21, 2014, the fair market value of the Company’s hedge portfolio through 2018 was a net asset of $381 million. Additional information regarding the Company’s fuel derivative contracts is included in the accompanying tables.

Excluding fuel and oil expense, profitsharing, and special items in both periods, second quarter 2014 operating costs increased 1.1 percent from second quarter 2013, and increased 1.7 percent on a unit basis. Based on current cost trends, and excluding fuel and oil expense, profitsharing, and special items, the Company expects a year-over-year increase in its third quarter 2014 unit costs, comparable to the second quarter 2014 year-over-year increase.

Operating income in second quarter 2014 was $775 million, compared to $433 million in second quarter 2013. Excluding special items, operating income was $819 million in second quarter 2014, compared to $479 million in the same period last year, a 71.0 percent increase year-over-year.

Other expenses in second quarter 2014 were $29 million, compared to $70 million in second quarter 2013. The $41 million decrease primarily resulted from $3 million in other losses recognized in second quarter 2014, compared to $47 million recognized in second quarter 2013. In both periods, these losses included ineffectiveness and unrealized mark-to-market amounts associated with a portion of the Company’s fuel hedging portfolio, which are special items. Excluding these special items, second quarter 2014 had $15 million in other losses, compared to $12 million in second quarter 2013, primarily attributable to the premium costs associated with the Company’s fuel derivative contracts. Third quarter 2014 premium costs related to fuel derivative contracts are currently estimated to be $15 million, compared to $22 million in third quarter 2013. Net interest expense in second quarter 2014 was $26 million, compared to $23 million in second quarter 2013.

For the six months ended June 30, 2014, total operating revenues increased 5.2 percent to $9.2 billion, while total operating expenses decreased 0.4 percent to $8.2 billion, resulting in operating income of $991 million, compared to $503 million for the same period last year. Excluding special items, operating income was $1.1 billion for first half 2014, compared to $591 million for first half 2013.

Net income for first half 2014 was $617 million, or $.88 per diluted share, compared to $283 million, or $.39 per diluted share, for the same period last year. Excluding special items, net income for first half 2014 was $611 million, or $.87 per diluted share, compared to $328 million, or $.45 per diluted share, for the same period last year.

Balance Sheet and Cash Flows

As of June 30, 2014, the Company had $4.0 billion in cash and short-term investments, and a fully available unsecured revolving credit line of $1 billion. Net cash provided by operations during second quarter 2014 was $1.34 billion, and capital expenditures were $500 million, generating strong free cash flow of $838 million. The Company repaid $73 million in debt and capital lease obligations during second quarter 2014.

During second quarter 2014, the Company returned $282 million to its Shareholders through the payment of $42 million in dividends and the repurchase of $240 million in common stock, or 7.6 million shares. The Company completed its previous $1.5 billion share repurchase program with the repurchase of $20 million in common stock in early May. On May 14, 2014, the Company’s Board of Directors authorized a new $1 billion share repurchase program, along with a 50 percent increase in the Company’s quarterly dividend. Under the new $1 billion share repurchase program, the Company repurchased an additional $220 million in common stock during second quarter 2014, including $200 million repurchased under an accelerated share repurchase program with a third party financial institution. During second quarter 2014, pursuant to the accelerated share repurchase program, the Company advanced $200 million to the financial institution and received six million shares of the Company’s common stock, representing an estimated 75 percent of the shares the Company expects to purchase under the accelerated share repurchase program. The specific number of shares that the Company ultimately will repurchase under the accelerated share repurchase program will be determined generally based on a discount to the volume-weighted average price per share of the Company’s common stock during a calculation period to be completed during third quarter 2014. At settlement, under certain circumstances, the third party financial institution may be required to deliver additional shares of common stock to the Company, or under certain circumstances, the Company may be required to deliver shares of its common stock or may elect to make a cash payment to the third party financial institution. Pursuant to the settlement of the $200 million accelerated share repurchase program executed in first quarter 2014, the Company received an additional 1.7 million shares in common stock during second quarter 2014, bringing the total shares repurchased under the first quarter accelerated share repurchase program to 8.6 million.

Fleet

During second quarter 2014, the Company’s fleet increased by seven to 683 aircraft at period end. This reflects the second quarter 2014 delivery of 12 new Boeing 737-800s and three pre-owned Boeing 737-700s, as well as the retirement of one Boeing 737-500. In addition, the Company removed seven Boeing 717-200s from service during second quarter 2014 in preparation for transition out of the fleet.

Boeing 737 NG Delivery Schedule:

Southwest 737NG Delivery Schedule 7.2014 (LRW)

Notes:

*Additional information regarding special items is included in the accompanying reconciliation tables, and see Note Regarding Use of Non-GAAP Financial Measures.
**Operating margin, excluding special items, is calculated as operating income, excluding special items, divided by operating revenues.

Copyright Photo: Michael B. Ing/AirlinersGallery.com. Boeing 737-7H4 N280WN (msn 32533) in the Penguin One special livery arrives in Los Angeles.

Southwest Airlines: AG Slide Show

AirTran Airways: AG Slide Show

Sun Country to add three seasonal destinations this winter

Sun Country Airlines (Minneapolis/St. Paul) is expanding in the Caribbean, Mexico and Central America this coming winter with new seasonal service. The airline will start weekly service from MSP to St. Maarten (December 20 through April 4), Manzanillo (January 8 through April 2) and Rio Hato (near Panama City) December 26 through April 3 per Airline Route.

Copyright Photo: Ton Jochems/AirlinersGallery.com. Boeing 737-752 N714SY (msn 33786) taxies at Los Angeles.

Sun Country Airlines: AG Slide Show

Route Map:

Sun Country 7.2014 Route Map

Boeing rolls out the 5000th Next-Generation 737

5000th NG 737 C-40A U.S. Navy Factory

Boeing (Chicago and Seattle) rolled out the 5000th Next-Generation 737 this week. The airplane is a Boeing C-40A Clipper, a modified 737-700C, that will serve as a transport aircraft for the U.S. Navy.

Utilizing the 737 commercial platform takes advantage of the proven efficiencies, manufacturing processes and performance of the existing Next-Generation 737 production system. Boeing’s P-8 maritime patrol aircraft, Airborne Early Warning and Control (AEW&C) and the C-40 are among the 737 military derivatives.

To date, orders stand at 6,804 for Next-Generation 737s and 2,109 for 737 MAXs. Total 737 orders have surpassed 12,000 including Classics and more than 100 orders for military derivatives.

Copyright Photo: Boeing.

Delta reduces Caracas service to one flight a week

Delta Air Lines (Atlanta) effective August 1 will reduced its service on the Atlanta-Caracas route to one flight a week per Airline Route. This move follows the actions of American Airlines. Both carriers are reducing services to CCS due to the Venezuelan government’s attempt to disallow the transfer of funds out of Venezuela.

Copyright Photo: Jay Selman/AirlinersGallery.com. The route will now be operated with smaller Boeing 737-700s. Boeing 737-732 N309DE (msn 29634) arrives at the New York (JFK) hub.

Delta Air Lines (current livery): AG Slide Show

United Airlines flight 1463 is forced to make an emergency landing at Wichita after the emergency chute accidentally inflates inflight

United flight 1463 ORD-SNA emergency chute (Taylor Martinez)(LR)

United Airlines (Chicago) flight UA 1463 was forced to make an emergency landing at Wichita, Kansas after the aft emergency chute accidentally inflated while the Boeing 737-700 was at cruising altitude. According to Flight Aware the 737-700 with 96 passengers and crew members on board was forced to make a rapid descent before the safe landing. Flight 1463 was en route from the Chicago (O’Hare) hub to Orange County (Santa Ana).

Read the full report from Eyewitness News 12: CLICK HERE

Twitter Photo: Taylor Martinez.

Video:

Sun Country Airlines to add new winter season service to Nassau, Bahamas

Sun Country Airlines (Minneapolis/St. Paul) starting on January 16, 2015 will add a new seasonal route to Nassau in the Bahamas from Minneapolis/St. Paul (MSP). The new route will initially operate weekly and then increase to three roundtrips a week starting on February 12, 2015.

Copyright Photo: Michael B. Ing/AirlinersGallery.com. Boeing 737-7Q8 N712SY (msn 28219) approaches the runway at Los Angeles International Airport.

Sun Country Airlines: AG Slide Show

 

WestJet launches nonstop flights from the Canadian oil sands to the Vegas desert lights

WestJet (Calgary) today (June 24) launches new nonstop, twice-weekly service between Las Vegas and Fort McMurray, Alberta. Today’s inaugural flight represents even more service to Fort McMurray as part of a major expansion of flights into the oil sands region.

Copyright Photo: Jay Selman/AirlinersGallery.com. Boeing 737-76N C-GWSE (msn 33379) prepares to touch down in Las Vegas.

WestJet: AG Slide Show

SAS to cut 300 additional jobs as its losses widen

Scandinavian Airlines-SAS (Stockholm) is again back in a financial crisis mode. After reporting a net loss of over $120 million in its fiscal second quarter ending on April 30, the airline has announced it is again tightening its efforts to reduce costs. This time it will include another 300 jobs being axed. The airline is coming under intense pressure from lower cost airlines like Norwegian and Ryanair.

Read the full report from the company: CLICK HERE

Read the analysis from the Wall Street Journal: CLICK HERE

Copyright Photo: Stefan Sjogren/AirlinersGallery.com. Boeing 737-783 LN-RNU (msn 34548) arrives back at the Stockholm (Arlanda) hub.

Scandinavian Airlines-SAS:

Southwest Airlines selects Boeing’s “Airplane Health Management” program

Boeing (Chicago and Seattle) has announced Southwest Airlines (Dallas) has selected Boeing Airplane Health Management (AHM) to enhance operational efficiency in its maintenance and engineering operations.

Southwest Airlines will use Airplane Health Management to collect and evaluate airplane operations data while the airplane is in flight. This real-time data is used to signal ground operations crews of any potential maintenance issues before the airplane lands, minimizing flight schedule disruptions and maintenance-related delays.

Boeing technical teams will work with Southwest to facilitate initial deployment of the system for its Next-Generation 737s. Southwest is Boeing’s 66th customer for Airplane Health Management.

According to Boeing, “Boeing Airplane Health Management is a powerful, data-driven capability used worldwide by airplane operators and maintenance, repair and overhaul providers (MROs) to proactively manage the serviceability of airplanes and fleets. It is designed to interface with existing airplane systems and communication infrastructure, using state-of-the-art airplane and ground technology to address day-of-operation disruptions, help predict future operations events and prevent unplanned maintenance and schedule interruptions.”

Airplane Health Management is part of an integrated suite of aviation services marketed as the Boeing Edge. These include parts, training, engineering, maintenance and software solutions that increase the efficiency and profitability of airlines and leasing companies.

Southwest Airlines is an all-Boeing carrier and operates the largest 737 fleet of any airline. In 2011, the airline became the launch customer for the 737 MAX.

Copyright Photo: Michael B. Ing/AirlinersGallery.com. Boeing 737-7H4 N214WN (msn 32486) in the special “Maryland One” state theme arrives at Los Angeles International Airport.

Southwest Airlines: AG Slide Show

Southwest converts more flights at Akron-Canton

Southwest Airlines (Dallas) has converted four more destinations and added flights from Akron-Canton Airport (CAK). Southwest, the busiest airline operating out of CAK, now offers eight daily nonstop flights from the airport. Destinations with new or additional Southwest service from Akron-Canton include Boston (Logan), New York (LaGuardia), Orlando and Denver (a second seasonal round trip). To celebrate the largest single conversion from AirTran Airways to Southwest Airlines, CAK and Southwest officials will hold a British invasion themed press conference and all day long gate party on June 9. A Beatles® cover band, balloon twisting, trivia contest and colossal #CAKFab4 destinations display will greet customers as the depart and arrive throughout the day.

Southwest Airlines will take over all routes to/from CAK on November 2, 2014 as well as adding a daily nonstop flight to Ronald Reagan Washington National Airport. The last AirTran Airways flight from CAK will be to Atlanta on November 1.

Copyright Photo: Jay Selman/AirlinersGallery.com. Boeing 737-7H4 N449WN (msn 32469) arrives in Las Vegas.

Southwest Airlines: AG Slide Show

AirTran Airways: AG Slide Show

Aerolineas Argentinas decorates Boeing 737-700 LV-CSI for the upcoming FIFA World Cup in Brazil

Aerolineas Argentinas 737-700 WL LV-CSI (14-Vamos Argentina)(Flt)(AR)(LRW)

Aerolíneas Argentinas (Buenos Aires) has issued photos and images of the scheme and the painting of the special FIFA 2014 World Cup livery that has been applied to Boeing 737-7Q8 LV-CSI (msn 30707) which will transport the Argentine football (soccer) team to Brazil for the upcoming games.

Aerolineas Argeninas 737-700 WL LV-CSI (14-FIFA World Cup 2014 player)(AR)(LRW)

Copyright Photo: Workers apply the special decals showcasing the players from Argentina.

Special thanks to Alvaro Romero, reporting from neighboring Chile.

Copyright Photo and Images: Aerolineas Argentinas.

Aerolineas Argentinas: AG Slide Show

Aerolineas Argentinas 737-700 WL LV-CSI (14-Vamos Argentina)(Drawing)(AR)(LRW)

United to start nonstop Denver-Panama City, Panama flights on December 3

United Airlines (Chicago) will start a new international route from its Denver hub to Panama City, Panama on December 3. The new route will be operated daily with Boeing 737-700s per Airline Route.

Copyright Photo: Ton Jochems/AirlinersGallery.com. Boeing 737-724 N39728 (msn 28944) approaches the runway at Los Angeles International Airport.

United Airlines (current): AG Slide Show

United wants to fly the Guam-Shanghai route

United Airlines (Chicago) has filed to operate nonstop Guam-Shanghai (Pudong). According to Airline Route, the new route will be operated two days a week with Boeing 737-700s.

In addition, United is dropping the Los Angeles-Kelowna, British Columbia route on September 2 (switched to the San Francisco hub) as well as the Los Angeles-Bakersfield route on August 19. The company is also ending the Newark-Moncton route on September 18.

Copyright Photo: Ton Jochems/AirlinersGallery.com. Boeing 737-724 N16709 (msn 28779) taxies at Los Angeles International Airport (LAX).

United Airlines (current): AG Slide Show

United to start nonstop Denver-Panama City, Panama flights on December 3

United Airlines (Chicago) today announced that it will introduce nonstop flights between its hub at Denver International Airport and Panama City beginning on December 3, subject to government approval with flights available for sale at a later date. The new service will operate daily November through August and five times weekly in September and October, offering Denver-area travelers direct access to the Panamanian capital and connections to several additional cities in Central and South America through United’s strategic partnership with Copa Airlines.

United will operate the service with Boeing 737-700 aircraft with 118 seats – 12 in United Business and 106 in United Economy, including 40 Economy Plus extra-legroom seats.

United Airlines is Denver’s largest airline, offering more flights and more seats from the Mile High City to more destinations around the world than any other carrier. The airline offers more than 375 flights each day from Denver International Airport to more than 10 destinations in Latin America, Canada and Asia – as well as service to top business centers in North America.

United has a proud history in Denver, serving the community for over 75 years. The airline is a proud partner of the Colorado Symphony, the Denver Public Schools Foundation, the Denver Center for the Performing Arts, the Latin American Education Foundation and the Denver Broncos.

United employs more than 5,100 coworkers in the Denver area.

Copyright Photo: Michael B. Ing/AirlinersGallery.com. Boeing 737-724 N25705 (msn 28766) climbs away from Los Angeles International Airport.

United Airlines (current): AG Slide Show

AeroMexico reduces its first quarter net loss to $6.8 million

AeroMexico (Mexico City) issued the following financial statement for the first quarter:

 

Grupo Aeromexico S.A.B de C.V. (AeroMexico) reported its unaudited consolidated results for the first quarter 2014:

  •   Grupo Aeromexico reported total revenues of $9.777 billion pesos; a 6.6% year-on-year increase.
  •   The cost of available seat kilometers (CASK) excluding fuel decreased 3.6% year-on-year in the first quarter 2014, representing the fifth consecutive quarter with a year-on-year decrease in this indicator.
  •   First quarter 2014 EBITDAR reached $1.393 billion pesos, with a 14.2% margin. Operating income was $31 million pesos.
  •   Grupo Aeromexico reported a net loss of $90 million pesos ($6.8 million) in the first quarter 2014, which compares favorably to the net loss of $122 million pesos ($9.3 million) reported in the first quarter of 2013.
  •   Grupo Aeromexico retired two Boeing 737-700 from its fleet, both under a pure lease agreement. Grupo Aeromexico’s operating fleet therefore consisted of 115 aircraft as of March 31, 2014.
  •   First quarter load factor reached 79.3%; a 5.8 percentage point increase compared to the first quarter of 2013.

 

Copyright Photo: Michael B. Ing/AirlinersGallery.com. Boeing 737-752 XA-MAH (msn 35122) with the special “Club Premier Credit Card” advertising markings prepares to land at Los Angeles International Airport.

AeroMexico: AG Slide Show

Southwest Airlines Company reports record first quarter net profit of $126 million

Southwest Airlines Company (Southwest Airlines and AirTran Airways) (Dallas) today reported its first quarter 2014 results:

Record first quarter net income, excluding special items*, of $126 million, or $.18 per diluted share, compared to first quarter 2013 net income, excluding special items, of $53 million, or $.07 per diluted share. This exceeded the First Call consensus estimate of $.16 per diluted share.

Record first quarter net income of $152 million, or $.22 per diluted share, which included $26 million (net) of favorable special items, compared to net income of $59 million, or $.08 per diluted share, in first quarter 2013, which included $6 million (net) of favorable special items.

Record first quarter operating income of $215 million; $242 million excluding special items.
Return on invested capital*, before taxes and excluding special items (ROIC), for the 12 months ended March 31, 2014, of 14.2 percent, as compared to 8.3 percent for the 12 months ended March 31, 2013.

Gary C. Kelly, Chairman of the Board, President, and Chief Executive Officer, stated, “I am delighted to report record first quarter earnings, which increased significantly year-over-year, despite the disruption caused by more than 7,500 of our flights canceled due to extreme weather conditions and the impact of the shift in timing of the Easter and Passover holidays. This outstanding performance was driven by record first quarter operating revenues of $4.2 billion, and a 1.2 percent year-over-year decline in total operating costs, excluding special items, driven largely by lower fuel prices and our ongoing fleet modernization. Our record first quarter operating income of $242 million, excluding special items, was very strong, especially considering an estimated $50 million unfavorable impact from winter storms. Operationally, our Employees did an outstanding job in difficult conditions taking care of our Customers, and I thank them again for their efforts.

“Our first quarter 2014 earnings performance is a superb start to the year and on plan to achieve a 15 percent pre-tax return on invested capital for the year, excluding special items. Second quarter 2014, benefiting from the Easter and Passover holidays, also is off to a great start, with strong bookings, favorable revenue trends, and stable fuel prices.

“Our balance sheet, liquidity, and cash flows remain strong. We are actively managing our debt and total invested capital, while making strategic investments that have already contributed significantly to our record profitability. We were pleased to return $371 million to Shareholders during first quarter 2014 through the payment of $56 million in dividends and the repurchase of $315 million in common stock. Since August 2011, we have returned $1.6 billion to our Shareholders through share repurchases and dividend payments.

“Our five strategic initiatives are on track and meeting or exceeding expectations. In January, we deployed our international reservation system and began selling Southwest’s inaugural international service to Aruba, The Bahamas, and Jamaica, scheduled to begin July 1, 2014. We quickly followed with selling Southwest service to Cancun and Los Cabos, scheduled to begin August 10, 2014. By the end of this year, we intend to fully convert AirTran’s seven international markets, along with its remaining domestic markets, to the Southwest route network. We have converted 21 of the 52 AirTran Boeing 737-700s to the Southwest Evolve configuration, and plan to convert the remaining 31 -700s this year (see below). This will complete the AirTran integration and retire the brand by the end of 2014.

“We have a significant amount of fleet activity planned this year, as we wind down the AirTran brand and continue to modernize our fleet, resulting in a larger than normal number of aircraft out of scheduled service. Accordingly, we expect relatively flat 2014 available seat miles, year-over-year.

“Our network development and optimization results, to date, have been excellent. We are excited about the opportunity to add new service to New York LaGuardia, Washington Reagan National, and Dallas Love Field this year, as well as to the international terminal under construction at Houston Hobby next year. Looking ahead to 2015, while we have not finalized our fleet and capacity plans, we have been managing to a baseline of 695 aircraft, which was our combined fleet at the time of the AirTran acquisition. We are planning year-over-year growth in our available seat miles derived from increased fleet utilization resulting from the completion of the AirTran integration and the increase in seats from the upgauging of our fleet. Of course, this will drive significant unit cost benefits.”

Financial Results and Outlook

The Company’s first quarter 2014 total operating revenues increased 2.0 percent, year-over-year, to $4.2 billion, despite an estimated $45 million reduction to revenues from weather-related cancellations. Operating unit revenues increased 3.1 percent, on a 1.1 percent decrease in available seat miles and a 2.6 percent increase in average seats per trip, all as compared to first quarter 2013. While the shift in the timing of the Easter and Passover holidays impacted March results, April bookings and revenue trends, thus far, are strong. Based on April’s trends and current bookings for the remainder of the second quarter, the Company expects another solid year-over-year increase in its second quarter 2014 operating unit revenues.

Total operating expenses in first quarter 2014 decreased 1.6 percent to $4.0 billion, as compared to first quarter 2013. First quarter 2014 total operating expenses included an estimated $5 million in net costs associated with winter storms. The Company incurred costs (before profitsharing and taxes) associated with the acquisition and integration of AirTran, which are special items, of $18 million during first quarter 2014, compared to $13 million in first quarter 2013. Cumulative costs associated with the acquisition and integration of AirTran, as of March 31, 2014, totaled $428 million (before profitsharing and taxes). The Company expects total acquisition and integration costs to be no more than $550 million (before profitsharing and taxes). Excluding special items in both periods, total operating expenses in first quarter 2014 decreased 1.2 percent to $3.9 billion, as compared to $4.0 billion in first quarter 2013.

First quarter 2014 profitsharing expense was $29 million, compared to $15 million in first quarter 2013. Profitsharing expense in first quarter 2014 was impacted by acquisition and integration costs incurred during that period. In addition, in accordance with the Company’s ProfitSharing Plan (the Plan), first quarter 2014 operating profit, as defined in the Plan, was reduced by a portion of the acquisition and integration costs incurred from April 1, 2011, through December 31, 2013, which will be amortized from January 1, 2014, through December 31, 2018.

First quarter 2014 economic fuel costs were $3.08 per gallon, including $.06 per gallon in favorable cash settlements from fuel derivative contracts, compared to $3.29 per gallon in first quarter 2013, including $.05 per gallon in unfavorable cash settlements from fuel derivative contracts. Based on the Company’s fuel derivative contracts and market prices as of April 21, 2014, second quarter 2014 economic fuel costs are expected to be comparable to second quarter 2013’s economic fuel costs of $3.06 per gallon. As of April 21, 2014, the fair market value of the Company’s hedge portfolio through 2017 was a net asset of approximately $252 million. Additional information regarding the Company’s fuel derivative contracts is included in the accompanying tables.

Excluding economic fuel and oil expense, profitsharing, and special items in both periods, first quarter 2014 operating costs increased 2.4 percent from first quarter 2013, and increased 3.5 percent on a unit basis. Based on current cost trends, the Company expects both second quarter 2014 and full year 2014 unit costs, excluding fuel and oil expense, profitsharing, and special items, to increase, year-over-year, in the two to three percent range.

Operating income for first quarter 2014 was $215 million, compared to $70 million in first quarter 2013. Excluding special items, operating income was $242 million in first quarter 2014, compared to $112 million in the same period last year.

Other income in first quarter 2014 was $29 million, compared to $24 million in first quarter 2013. The $5 million increase primarily resulted from $53 million in other gains recognized in first quarter 2014, compared to $46 million recognized in first quarter 2013. In both periods, these gains primarily resulted from unrealized mark-to-market net gains associated with a portion of the Company’s fuel hedging portfolio, which are special items. Excluding these special items, first quarter 2014 had $16 million in other losses, compared to $5 million in first quarter 2013, primarily attributable to the premium costs associated with the Company’s fuel derivative contracts. Second quarter 2014 premium costs related to fuel derivative contracts are currently estimated to be in the $15 million to $20 million range, compared to $12 million in second quarter 2013. Net interest expense in first quarter 2014 was $24 million, compared to $22 million in first quarter 2013.

Balance Sheet and Cash Flows

As of April 23, 2014, the Company had approximately $3.5 billion in cash and short-term investments, and a fully available unsecured revolving credit line of $1 billion. Net cash provided by operations during first quarter 2014 was $1.1 billion, and capital expenditures were $407 million, which included the payment for slots acquired at Washington’s Reagan National Airport. The Company repaid $46 million in debt and capital lease obligations during the first quarter 2014, and intends to repay approximately $500 million in debt and capital lease obligations during the remainder of 2014, which includes $35 million paid on April 1, 2014, associated with eight of the Company’s Fixed-rate Boeing 717 Aircraft Notes due in 2017.

During first quarter 2014, the Company generated free cash flow* of $712 million. The Company returned approximately $371 million to its Shareholders through the payment of $56 million in dividends and the repurchase of $315 million in common stock, or 12 million shares, under its share repurchase program, including $200 million under an accelerated share repurchase program with a third party financial institution. In first quarter, pursuant to the accelerated share repurchase program, the Company advanced $200 million to the financial institution and received approximately seven million shares of the Company’s common stock, representing an estimated 75 percent of the shares the Company expects to purchase under the accelerated share repurchase program. The specific number of shares that the Company ultimately will repurchase under the accelerated share repurchase program will be determined generally based on a discount to the volume-weighted average price per share of the Company’s common stock during a calculation period to be completed by May 9, 2014. At settlement, under certain circumstances, the third party financial institution may be required to deliver additional shares of common stock to the Company, or under certain circumstances, the Company may be required to deliver shares of its common stock or may elect to make a cash payment to the third party financial institution. Since August 2011, the Company has repurchased $1.48 billion in common stock, or 124 million shares, under its $1.5 billion share repurchase authorization.

Fleet

During first quarter 2014, the Company’s fleet was reduced by five to 676 aircraft at period end. This reflects the first quarter 2014 delivery of two new Boeing 737-800s and six pre-owned Boeing 737-700s, as well as the retirement of one Boeing 737-300. In addition, the Company removed 12 Boeing 717-200s from service during first quarter 2014 in preparation for transition. Additional information regarding the Company’s aircraft delivery schedule is included in the accompanying tables.

Southwest 737-700 Fleet Table

Read the analysis by Bloomberg Businessweek: CLICK HERE

Top Copyright Photo: Brian McDonough/AirlinersGallery.com. Southwest’s Boeing 737-7H4 N214WN (msn 32486) completes its final turn on the river approach into Washington’s Reagan National Airport (DCA).

Southwest Airlines: AG Slide Show

AirTran Airways: AG Slide Show

Bottom Copyright Photo: Ton Jochems/AirlinersGallery.com. AirTran’s Boeing 737-7BD N315AT (msn 35788) completes its final approach to the runway at Los Angeles International Airport (LAX).

 

Southwest Airlines to distribute $228 million in profit sharing

Southwest Airlines (Dallas) has announced it will contribute approximately $228 million—the largest total dollar amount ever allocated—directly to Employees through its ProfitSharing Plan this year. The payment is an 88 percent increase over last year’s contribution of $121 million. Southwest was the first in the industry to offer a ProfitSharing Plan, and this is the Company’s 40th consecutive ProfitSharing payment. Through the ProfitSharing Plan, Southwest Employees currently own more than four percent of the Company’s outstanding shares.

Combined with ProfitSharing is the Company’s $269 million match and other amounts contributed to the Southwest and AirTran 401(k) plans. Southwest rewarded its Employees with a 2013 total retirement benefit of nearly $500 million. In addition to retirement contributions, Southwest Airlines also invested approximately $580 million in its Employees’ benefits during 2013, which included healthcare coverage, wellness programs, and other benefits. In total, that’s more than $1 billion dedicated to the wealth and wellbeing of Southwest Employees in 2013 alone, on top of base salaries.

Over four decades, Southwest ProfitSharing contributions have totaled $2.5 billion. In other words:

It’s enough money to buy 500 million mini bottles of founder Herb Kelleher’s drink of choice, Wild Turkey, which would fill 10 Olympic-sized swimming pools.
Or, $2.5 billion would buy 83 billion bags of Southwest peanuts—enough for 10 roundtrips to the moon if you lined them up end-to-end.

Copyright Photo: Jay Selman/AirlinersGallery.com. Boeing 737-7H4 N481WN (msn 29853) prepares to touch down in Las Vegas.

Southwest Airlines: AG Slide Show

Southwest to partner with Placemaking for its “Project for Public Spaces”, WSJ takes a look at “aging” Southwest

Southwest Airlines (Dallas) announced on April 3 a multi-year commitment to Placemaking – a movement that reimagines public spaces as the heart of every community. Through the Southwest Airlines Heart of the Community program, the airline will revitalize and activate public spaces in the hearts of American cities in partnership with the pioneering nonprofit organization behind Placemaking, Project for Public Spaces (PPS).

Building upon successful pilot projects in Detroit, Michigan, and Providence, Rhode Island, in 2013, Southwest and PPS will help transform multiple public spaces in 2014 with the intent to expand the Heart of the Community program and support dozens of public spaces through Placemaking projects in the years to come.

For more than 30 years, Placemaking has sparked social, economic, and environmental benefits in communities around the world. Rooted in community-based participation, Placemaking involves the planning, design, management and programming of public spaces and capitalizes on a community’s assets and potential to create vibrant destinations—such as neighborhood parks, community markets and downtown squares.

In late 2013, Southwest provided a gift to support the MIT Department of Urban Studies and Planning’s research white paper, Places in the Making, which demonstrated the power of Placemaking to create connected, sustainable, healthy, and economically viable communities. The research emphasized Placemaking’s positive impact on community building and empowerment and cited the need for public/private partnerships to advance the practice of Placemaking.

Through the Heart of the Community program, Southwest and PPS will collaborate with local community partners in cities across the country to bring new life to their public spaces. Earlier this week, Southwest and PPS unveiled their most recent project in San Antonio, Texas, where they partnered with the Center City Development Office to activate historic Travis Park through new physical amenities, including games, umbrellas, tables and chairs and ongoing programming, such as fitness classes and live music. In 2013, Southwest and PPS worked with the Downtown Detroit Partnership to transform an underutilized lawn in downtown’s Campus Martius Park into a seasonal beach with a deck and seating that serves as a fun and relaxing community gathering place for workers, families and children. Additionally, they worked with the Downtown Providence Parks Conservancy to create the Imagination Center, a new place for family activities in Burnside Park, located in the heart of downtown Providence, R.I.

Heart of the Community is part of Southwest’s broader efforts to connect people and strengthen local communities through its core business, charitable giving, community outreach, and environmental initiatives. To read more, go to Nuts About Southwest.

Meanwhile the Wall Street Journal (WSJ) has published an article on Southwest that claims the airline is showing its age and becoming a higher cost airline.

Read the article: CLICK HERE

Copyright Photo: Jay Selman/AirlinersGallery.com. Boeing 737-7H4 N492WN (msn 33866) arrives in Las Vegas.

Southwest Airlines: AG Slide Show

SAS to connect the oil region of Norway with Houston, Texas

Scandinavian Airlines-SAS (Stockholm) is launching services between Stavanger, Norway and Houston (Bush Intercontinental) on August 20. This fulfils the wishes of leading players in the oil industry for better connections between Norway, and the rest of Scandinavia, and Houston, Texas.

The route will be operated by a business version of the Boeing 737-700 and will have an SAS Long Haul Business Class concept on board, with just 44 comfortable business seats, along with a modern inflight entertainment system and full-service meals and service.

SAS has entered into a wet lease agreement with PrivatAir (Geneva) , which has this special version of the Boeing 737-700. The aircraft will carry SAS’s distinctive colors and logo.

The route will launch on August 20, just ahead of the major oil exhibition in Stavanger, Offshore Northern Seas (ONS). Tickets for route, which will operate daily except Saturdays, go on sale on April 29.

Read the article by Bloomberg Businessweek: CLICK HERE

Top Copyright Photo: Ariel Shocron/AirlinersGallery.com. SAS’ Boeing 737-783 LN-RRB (msn 32276) approaches the runway at Madrid (Barajas).

Scandinavian Airlines-SAS: AG Slide Show

PrivatAir: AG Slide Show

Bottom Copyright Photo: Keith Burton/AirlinersGallery.com. PrivatAir’s Boeing 737-7AK HB-JJA (34303) arrives in Amsterdam.

AeroMexico adds a fourth daily seasonal flight from Mexico City to Miami

AeroMexico (Mexico City) has announced the launch of its fourth daily seasonal flight between Miami and Mexico City as of April 11.

Below are the carrier’s schedules for this city pair:

Miami – Mexico City* Mexico City – Miami*
AM 433** 2:30 a.m. 5:06 a.m. Daily AM 432** 1:00 a.m. 4:57 a.m. Daily
AM 429 7:00 a.m. 9:49 a.m. Daily AM 412 9:36 a.m. 1:38 p.m. Daily
AM 423 3:00 p.m. 5:49 p.m. Daily AM 422 12:44 p.m. 4:54 p.m. Daily
AM 413 6:08 p.m. 8:57 p.m. Daily AM 428 7:45 p.m. 11:44 p.m. Daily

* Times published are local to each country and are subject to change without notice.

**New seasonal flight.

All four daily flights will be operated with Boeing 737-700 aircraft configured with 124 seats, including 12 seats in AeroMexico’s Clase Premier front cabin, and will depart from Terminal H at the Miami International Airport. The terminal features benefits such as electronic check-in terminals and restaurants located close to the boarding gates.

Copyright Photo: Bruce Drum/AirlinersGallery.com. Boeing 737-752 XA-GMV (msn 35118) arrives at Miami International Airport (MIA) with a special promotional Los Cabos logo.

AeroMexico: AG Slide Show

Southwest moves to protect its Dallas Love Field home with 12 proposed new routes if it gets two new gates

Southwest Airlines (Dallas) plans to add 20 flights to 12 new nonstop destinations if the airline is able to acquire two additional gates at Dallas Love Field.  Southwest would add nonstop service to:

  • Charlotte, North Carolina
  • Charleston, South Carolina
  • Detroit, Michigan
  • Indianapolis, Indiana
  • Memphis, Tennessee
  • Minneapolis/St. Paul, Minnesota
  • Newark, New Jersey
  • Philadelphia, Pennsylvania
  • Raleigh/Durham, North Carolina
  • Sacramento, California
  • San Francisco, California
  • Seattle/Tacoma, Washington

These 12 new nonstop destinations would be added to Southwest’s schedule if the airline is able to obtain the rights to two Love Field gates that American Airlines must relinquish under the terms of a settlement with the U.S. Department of Justice.  These destinations would be in addition to the 15 cities that Southwest previously announced it would serve from Love Field beginning later this year, and five new nonstop destinations currently planned for service in 2015 that Southwest has announced:

  • Boston, Massachusetts (Boston Logan)
  • Oakland, California
  • Panama City Beach, Florida
  • Portland, Oregon
  • San Jose, California

With the upcoming sunset of the Wright Amendment restrictions on long-haul flights from Love Field, demand for Southwest nonstop service from the airport far exceeds the Company’s current gate capacity.  Access to two additional gates would allow Southwest to provide North Texas residents and visitors with the benefits of new nonstop flights to 12 additional destinations that would not otherwise be possible – a BIG win for consumers, businesses and the Dallas-Ft. Worth area.

The Dallas-Fort Worth area is a single aviation market that is served by two airports, DFW International Airport and Dallas Love Field.  In total, these airports have 175 gates (155 at DFW and 20 at Love Field).  If Southwest were to acquire the two additional Love Field gates, its percentage of gates in the Dallas-Ft. Worth market would remain very small, around 10 percent.  Importantly, other carriers, such as Virgin America and Delta Air Lines, already have a presence at DFW International Airport and can easily expand at DFW’s ample gate facilities.  In contrast, Southwest’s growth in North Texas can occur only at Love Field under the terms of the five-party agreement that resulted in the end of the Wright Amendment.

Copyright Photo: Arnd Wolf/AirlinersGallery.com. Boeing 737-7H4 N714CB (msn 27848) is retained in the gold “Southwest Classic” classic livery. It is pictured arriving at Las Vegas.

Southwest Airlines: AG Slide Show

 

WestJet to start Toronto-Phoenix flights

WestJet (Calgary) will start a new route linking the Toronto (Pearson) hub with Phoenix, Arizona starting on October 26. The new route will be operated with Boeing 737-700 aircraft on a daily basis per Airline Route.

Copyright Photo: Jay Selman/AirlinersGallery.com. WestJet Airlines Boeing 737-7CT WL C-FWSO (msn 32759) plans to land in Las Vegas.

WestJet: AG Slide Show

Follow

Get every new post delivered to your Inbox.

Join 2,667 other followers

%d bloggers like this: