Category Archives: Southwest Airlines

Southwest Airlines to ship cargo internationally

Delivered on November 7, 2017

Southwest Airlines has announced its intention to begin shipping cargo to select international destinations beginning in May 2018, subject to requisite government approvals. The first international destinations Southwest Airlines Cargo® expects to serve are Mexico City, Cancun, Cabo San Lucas/Los Cabos, and Puerto Vallarta with more international destinations planned for 2018.

New Suite of Services

The new international shipping options are made possible in part due to the rollout of Southwest Cargo’s new point-of-sale and back office accounting system, Southwest Cargo Suite (SCS).  SCS is expected to take the place of the current system in March 2018, and along with international capabilities, give Customers the ability to make advanced cargo bookings, and utilize electronic Air Waybills.

Southwest Cargo Adds to Trophy Case

Southwest Cargo was also honored by winning one of the air cargo industry’s most prestigious awards. It earned the Airforwarders Association’s Domestic Carrier of the Year award. This is the ninth consecutive year the carrier has earned the honor.

Copyright Photo: Southwest Airlines Boeing 737-8 MAX 8 N8715Q (msn 42570) FLL (Bruce Drum). Image: 104603.

Southwest Airlines (current livery):

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Southwest announces service between Nashville and Atlanta, extends schedule through October 1

"Missouri One"

Southwest Airlines (Dallas) has extended its bookable flight schedule through October 1, 2018, adding several new nonstop routes to its schedule.

Ahead of an event for thousands of Southwest® Employees in Nashville, airline Leaders announced that the carrier will be adding five departures a day Monday through Friday for nonstop travel between Nashville and Atlanta beginning on August 7, 2018. The route will be offered three times a day on Saturdays and Sundays.

 

*A fare difference might apply.

Growing Los Angeles

The airline continues to strengthen its service in California by announcing a new nonstop route linking Los Angeles area Customers to Florida with daily nonstop service between Los Angeles International Airport (LAX) and Tampa beginning August 7, 2018.

Also beginning August 7, 2018, the carrier will add frequency with one additional daily flight on the following routes:

Between LAX and New Orleans 

Increased to three roundtrips on weekdays

Between LAX and Portland, Oregon

Increased to three daily roundtrips on weekdays

Southwest also announced its daily nonstop seasonal service between Los Angeles and Omaha will be offered year-round beginning June 7, 2018.

Cincinnati Goes Mile-High

Cincinnati Customers will see their first daily nonstop service to Denver beginning August 7, 2018. This route complements the carrier’s five daily flights between Chicago and Cincinnati and three daily flights between Baltimore and Cincinnati.

Throughout March 2018, the carrier will also offer daily nonstop service between Cincinnati and Phoenix.

Midwest Additions

Southwest is adding more nonstop service from St. Louis and Kansas City, Mo., strengthening its position as the state’s biggest airline in terms of daily departures.

Beginning April 8, 2018, the carrier will add daily nonstop service between
Kansas City, Mo. and Raleigh-Durham, N.C.

Beginning August 7, 2018, the carrier will add daily nonstop service between
St. Louis and Hartford, Conn.

Wait, there’s more!

In January, the carrier announced its intention to serve Paine Field in Everett, Washington, subject to requisite approvals of governmental and regulatory agencies. The carrier’s flight schedule and low fares are expected to be announced this spring.

Additionally, the carrier remains on-track with its intention to sell tickets this year to Hawaii, subject to requisite governmental approvals.

 

Copyright Photo: Southwest Airlines Boeing 737-7H4 SSWL N280WN (msn 32533) (Missouri One) FLL (Bruce Drum). Image: 104597.

Southwest Airlines aircraft slide show (current livery):

Southwest Airlines employees earn $543 million in 2017 profit sharing

The former Sea World "Shamu" logo jet

Southwest Airlines announced it will share $543 million through its ProfitSharing Plan with its Employees for 2017. This equals approximately 11.3 percent of each eligible Employee’s eligible compensation—the equivalent of more than five weeks’ pay.

This is Southwest Airlines’ 44th consecutive ProfitSharing award. The Company will pay part of the ProfitSharing award to the retirement plan and part in cash. Most Employees will receive 10 percent of eligible compensation as a contribution to the ProfitSharing Plan, and the remainder—approximately 1.3 percent—in cash, both of which will be paid on March 15, 2018. Some Employees will receive the entire ProfitSharing award as a contribution to their retirement plan accounts as specified in their collective bargaining agreement.

This ProfitSharing award, when combined with contributions of $476 million to 401(k) plans, represents a total investment of more than $1 billion to reward Southwest Employees in 2017. This is in addition to the $1,000 tax reform bonus paid to each eligible Employee in January 2018, on top of base salaries.

Southwest was the first in the industry to offer a ProfitSharing Plan. Through the ProfitSharing Plan, Southwest Employees currently own more than 4 percent of the Company’s outstanding shares.

Copyright Photo: Southwest Airlines Boeing 737-7H4 WL N715SW (msn 27849) BWI (Tony Storck). Image: 927386.

Southwest Airlines aircraft slide show (current livery):

Southwest Boeing 737-800 slid sideways on a wet taxiway at BWI

Boeing 737-800 N8523W:

From Reuters:

A Southwest Airlines plane slid sideways while preparing for takeoff from Baltimore–Washington International Airport on Wednesday, according to the U.S. Federal Aviation Administration (FAA).

There were no reported injuries to the plane’s 143 passengers and six crew members, the carrier said, after Southwest Airlines flight 906 slid while preparing to depart for Montego Bay, Jamaica.

Video posted to Twitter (above) showed passengers disembarking from the Boeing 737 jet as safety officials looked on.

The FAA said in a statement that the plane remained on the taxiway and would be towed to the gate. The flight safety body said it would investigate the incident.

“As always, the safety and support of our customers and employees remains our primary focus and we are working to get them on their way as quickly as possible,” Southwest spokesman Brian Parrish said.

Pictures and video posted to social media showed heavy skid marks where the front of the plane slid to the edge of the taxiway.

“Sliding into vacation the wrong way,” Instagram user Josh@cherrimanj wrote on a picture showing the plane’s nose pointed to a grassy area out of taxiway lines.

Southwest Airlines is coming to Paine Field in Everett, WA

Southwest Airlines Boeing 737-71B WL N7845A (msn 29366) PAE (Nick Dean). Image: 935026.

Southwest Airlines (Dallas), as part of its 2017 financial report, disclosed today it too will fly from Paine Field in Everett, WA, north of Seattle later this year. The carrier will offer five daily flights from PAE.

Southwest will later disclose the destinations which are likely to be along the West Coast.

Previously Alaska Airlines announced service Paine Field with up to 13 daily flights from PAE.

United Airlines also announced it would operate six flights a day from PAE to its hubs in San Francsico and Denver.

Copyright Photo: Southwest Airlines Boeing 737-71B WL N7845A (msn 29366) PAE (Nick Dean). Image: 935026.

Southwest Airlines aircraft slide show (current livery):

Southwest Airlines reports record fourth quarter and annual profit; 45th consecutive year of profitability

Updated 2017 "Kidd's Kids - keep lookin' up" logo

Southwest Airlines Company reported its fourth quarter and annual 2017 results:

  • Record fourth quarter net income and earnings per diluted share of $1.9 billion and $3.18, respectively
  • Excluding special items1, fourth quarter net income of $459 million, or $.77 per diluted share
  • Record annual net income and earnings per diluted share of $3.5 billion and $5.79, respectively
  • Excluding special items1, annual net income of $2.1 billion, or $3.50 per diluted share
  • Annual operating income of $3.5 billion, resulting in an operating margin2 of 16.6 percent, or 16.3 percent, excluding special items3
  • Annual operating cash flow of $3.9 billion, and annual free cash flow1 of $1.8 billion
  • Returned approximately $1.9 billion to Shareholders through a combination of $274 million in dividends and $1.6 billion in share repurchases
  • Annual return on invested capital (ROIC)1 of 25.9 percent

Gary C. Kelly, Chairman of the Board and Chief Executive Officer, stated, “Our strong fourth quarter earnings performance capped another year of extraordinary achievements, including 45 straight years of profitability. Last week, for the 24th consecutive year, Southwest was named to FORTUNE’s 2018 list of World’s Most Admired Companies. I want to thank our People for their exceptional results and congratulate them on this outstanding honor.

“Our strong profits, cash flow, and financial position enabled us to deploy capital wisely and sustain high returns on invested capital. We made significant progress modernizing our fleet, investing in technology and facilities, and returning value in excess of our free cash flow1 to Shareholders. We celebrated several notable milestones during 2017, including the implementation of our new reservation system; the retirement of our Boeing 737-300 Classic fleet; the launch of the new Boeing 737 MAX 8; the launch of service to Cincinnati, Grand Cayman, and Turks & Caicos; and the announcement of our commitment to serve Hawaii. Our Employees delivered another outstanding year of operational Reliability and Hospitality, including the best baggage delivery rates in our history. These achievements are significant, especially considering the backdrop of unprecedented natural disasters and the competitive industry environment. As ever, the Warrior Spirits and fortitude of our People resulted in an outstanding overall 2017 performance, which earned them $543 million in profitsharing during 2017.

“We applaud Congress and the President for the tax reform legislation passed on December 22, 2017. We celebrated the passage of tax reform with our Employees through a $1,000 per person cash bonus paid on January 8, 2018. We also announced an incremental donation to charitable causes and an additional investment in our fleet to support future growth opportunities and fleet modernization. The tax reform is very meaningful to Southwest Airlines, reducing our 2017 deferred tax liability by $1.4 billion. Based on our current outlook, the reduction in the statutory federal rate will result in hundreds of millions in tax savings, which will significantly boost our earnings in 2018.

“As we look to realize ongoing benefits of modernizing our fleet and optimizing our route network, we are enthusiastic about our ability to leverage our strengths and scale to meet Customer demand. We are pleased with the progress made thus far to obtain authorization from the Federal Aviation Administration for Extended Operations (ETOPS) to operate between the mainland and the Hawaiian Islands later this year. In addition, as a complement to our more than forty flights a day to 15 cities nonstop from Seattle-Tacoma International Airport, today we announce our commitment to launch up to five daily flights4 at a new commercial aircraft facility at Paine Field in Everett, Washington, scheduled to be completed later this year.

“We begin 2018 focused on our goal to expand margins and profits, excluding special items1. Our balance sheet and liquidity remain strong, with manageable debt service and capital spending this year. Our 2018 growth plans effectively replace Classics retired last year and further strengthen our robust route network. Based on the current outlook and our commercial initiatives and objectives, our goal remains to achieve positive unit revenue growth in 2018, year-over-year. We continue to expect our new reservation system to produce incremental improvements in pre-tax results of approximately $200 million in 2018, primarily from enhanced revenue management capabilities. We remain focused on improving our productivity and reliability and reducing our year-over-year operating costs per available seat mile, excluding fuel and oil expense, profitsharing expense, and special items1, in 2018. Overall, our strong financial performance, solid outlook, healthy balance sheet, and significantly lower federal income taxes, provide the cash flow to continue to reward our Employees, keep our costs and fares low for our Customers, reinvest in our business, return value to our Shareholders, and support our communities.”

Notable 2017 accomplishments for the Company include:

  • Achieved 45th consecutive year of profitability
  • Employees earned $543 million in profitsharing
  • Strengthened its investment-grade credit rating with an upgrade to A3 with Moody’s Investors Service and an upgrade to BBB+ with Standard & Poor’s
  • Deployed the largest technology initiative in its history with the achievement of a new reservation system
  • Completed the early retirement of the remaining Boeing 737-300 Classic aircraft
  • Introduced the Boeing 737 MAX 8 into its fleet
  • Revised its Boeing delivery schedule to support future growth opportunities and continued fleet modernization
  • Opened the newly revitalized and enhanced Terminal 1 at Fort Lauderdale-Hollywood International Airport to support expanded international flying from South Florida
  • Consolidated its Ohio operations and launched service at Cincinnati/Northern Kentucky International Airport
  • Launched service to Grand Cayman and Turks & Caicos Islands, ending the year with service to 14 international destinations in 10 countries
  • Launched international service from Oakland International Airport, San Diego International Airport, Nashville International Airport, and St. Louis Lambert International Airport, ending the year with 16 international gateway airports from the 48 contiguous states
  • Announced plans to begin selling tickets in 2018 for service to Hawaii
  • Ratified a collective bargaining agreement with the Facilities Maintenance Technicians
  • Received numerous awards and recognitions, including being ranked #1 in the U.S. Department of Transportation Customer Satisfaction ranking for 2016; named Domestic Carrier of the Year by the Airforwarders Association for the 8th consecutive year; ranked the highest Low-Cost Carrier in the J.D. Power 2017 North America Airline Satisfaction Study; named one of Corporate Responsibility’s 100 Best Corporate Citizens 2017; recognized by Express Delivery and Logistics Association with the 2016 Express Cargo Standard of Excellence award; received Readers’ Pick for Best Frequent Flyer Program (U.S.) for its Rapid Rewards® Program by SmarterTravel; ranked among the Best Airline Rewards Programs by U.S. News & World Report; named one of Glassdoor’s Best Places to Work for the 9th consecutive year; named Program of the Year for its Rapid Rewards Program and recognized for providing the Best Loyalty Credit Card, the Best Airline Redemption Ability, and for the 5th consecutive year, the Best Customer Service by the Freddie Awards; and designated as a 2017 Most Valuable Employer for military by Recruit Military, as well as a Best Employer in Forbes’ 2017 list

Revenue Results and Outlook
The Company’s fourth quarter 2017 total operating revenues were a fourth quarter record $5.3 billion, driven largely by record fourth quarter passenger revenues of $4.7 billion. As compared with fourth quarter 2016, total operating revenues increased 3.9 percent on a 2.0 percent increase in available seat miles, resulting in a 1.9 percent increase in operating unit revenues (RASM). Strong passenger demand resulted in a fourth quarter record 85.0 percent load factor, while fourth quarter passenger revenue yield decreased 0.1 percent, year-over-year. Passenger bookings and revenues for first quarter 2018, thus far, are solid. Based on these trends and the current outlook, the Company expects first quarter 2018 RASM to increase in the one to two percent range, as compared with first quarter 2017.

Beginning January 1, 2018, the Company expects to adopt Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers, and plans to utilize the full retrospective method of adoption allowed by the standard. The Company is in the process of completing its analysis of information necessary to recast prior period results, in order to provide comparative results in all periods presented. As such, the Company’s current forward-looking guidance for 2018 revenue trends excludes any impact associated with the adoption of ASU No. 2014-09.

Annual 2017 total operating revenues increased 3.7 percent, year-over-year, to a record $21.2 billion due to strong passenger demand for low fares, resulting in a 0.1 percent increase in RASM.

Cost Performance and Outlook
Fourth quarter 2017 total operating expenses increased 6.4 percent to $4.5 billion, and increased 4.3 percent on a unit basis, as compared with fourth quarter 2016. Excluding special items1 in both periods, which primarily related to the Company’s fuel hedge derivative contracts, fourth quarter 2017 total operating expenses increased 5.1 percent to $4.5 billion, and increased 3.0 percent on a unit basis, year-over-year.

Fourth quarter 2017 economic fuel costs1 were $2.09 per gallon, including $.19 per gallon in unfavorable cash settlements from fuel derivative contracts, compared with $2.07 per gallon in fourth quarter 2016, including $.50 per gallon in unfavorable cash settlements from fuel derivative contracts. Annual 2017 economic fuel costs1 of $2.00 per gallon increased 4.2 percent, as compared with 2016.

Beginning January 1, 2018, in accordance with the Company’s planned early adoption of ASU No. 2017-12, Targeting Improvements to Accounting for Hedging Activities, the Company will report fuel hedging premium expense within Fuel and oil expense rather than within Other (gains) and losses, net, on the Income Statement. Based on the Company’s existing fuel derivative contracts and market prices as of January 19, 2018, first quarter 2018 economic fuel costs1 are estimated to be in the $2.10 to $2.15 per gallon range5. This compares with both first quarter 2017’s economic fuel cost1 of $2.03 per gallon, which will be recast from $1.96 per gallon, as reported, and fourth quarter 2017’s economic fuel cost1 of $2.16 per gallon, which will be recast from $2.09 per gallon, as reported. Fuel hedging premium expense of approximately $34 million, or $.07 per gallon, is included in the first quarter 2018 estimated guidance range and also in the recast per-gallon prices for first and fourth quarters, 2017.

The Company’s annual 2018 economic fuel costs1 are currently estimated to be in the $2.10 to $2.15 per gallon range5, which is an approximate two percent increase from 2017’s annual economic fuel costs1 per gallon, including approximately $135 million, or $.06 per gallon, of fuel hedging premium expense in both years. The Company estimates an improvement in 2018 available seat miles per gallon, or fuel efficiency, in the two to three percent range, year-over-year, driven primarily by the retirement of the Boeing 737-300 Classic aircraft and the addition of the more fuel-efficient Boeing 737 MAX 8 aircraft.

As of January 19, 2018, the fair market value of the Company’s fuel derivative contracts settling in first quarter 2018 was a net asset of approximately $31 million, and a net asset of approximately $102 million for those settling over the remainder of 2018. In addition, the fair market value of the hedge portfolio settling in 2019 and beyond was a net asset of approximately $169 million. Additional information regarding the Company’s fuel derivative contracts is included in the accompanying tables.

Excluding fuel and oil expense and special items1 in both periods, fourth quarter 2017 operating expenses increased 6.2 percent, as compared with fourth quarter 2016. Fourth quarter 2017 profitsharing expense was $115 million, compared with $123 million in fourth quarter 2016. Excluding fuel and oil expense, profitsharing expense, and special items1, fourth quarter 2017 operating expenses increased 6.7 percent, and increased 4.6 percent on a unit basis, both year-over-year. These increases were driven primarily by increases in salaries, wages, and benefits including the tax reform Employee bonus of approximately $70 million, a litigation settlement, a shift in advertising spend from third quarter 2017, incremental costs associated with technology investments including ETOPS authorization in preparation for Hawaii, and an incremental charitable contribution following the passage of tax reform. Based on current cost trends, first quarter 2018 unit costs, excluding fuel and oil expense, profitsharing expense, and special items1, are estimated to increase in the range of 0.5 to 1.5 percent6, year-over-year.

Annual 2017 total operating expenses increased 5.9 percent to $17.7 billion, and increased 2.3 percent on a unit basis, year-over-year. Excluding fuel and oil expense, profitsharing expense, and special items1, annual 2017 total operating expenses increased 8.7 percent, and increased 4.9 percent on a unit basis, both year-over-year, primarily due to increases in salaries, wages, and benefits, and airport landing fees and rentals. Based on current cost trends, annual 2018 unit costs, excluding fuel and oil expense, profitsharing expense, and special items1, are estimated to be in the range of flat to down one percent6, year-over-year.

Fourth Quarter and Annual Results
Fourth quarter 2017 operating income was $773 million, compared with $846 million in fourth quarter 2016. Excluding special items1, fourth quarter 2017 operating income was $746 million, compared with $768 million in fourth quarter 2016.

Other expenses in fourth quarter 2017 were $36 million, compared with $37 million in fourth quarter 2016, which included other losses recognized of $28 million and $26 million, respectively. In both periods, these losses included ineffectiveness and unrealized mark-to-market amounts associated with a portion of the Company’s fuel hedge portfolio, which are treated as special items. Excluding these special items1, fourth quarter 2017 had $31 million in other losses, compared with $43 million in fourth quarter 2016, primarily attributable to fuel hedging premium expenses associated with the Company’s fuel derivative contracts. Net interest expense in fourth quarter 2017 was $8 million, compared with $11 million in fourth quarter 2016.

Fourth quarter 2017 net income was a quarterly record $1.9 billion, or a quarterly record $3.18 per diluted share, compared with fourth quarter 2016 net income of $522 million, or $.84 per diluted share. Fourth quarter 2017 net income was positively impacted by a $1.4 billiontax benefit due to tax reform legislation, which was recorded as a result of the difference in tax rates in effect when income tax expense was accrued, as compared with the rates expected to be in effect when the income taxes will be paid. This non-cash tax benefit effectively reduces the Company’s deferred tax liability on its Balance Sheet as of December 31, 2017. Excluding this and other special items1, fourth quarter 2017 net income was $459 million, or $.77 per diluted share, compared with fourth quarter 2016 net income of $463 million, or $.75per diluted share, and the First Call fourth quarter 2017 consensus estimate of $.76 per diluted share.

Annual 2017 operating income was $3.5 billion, compared with $3.8 billion in 2016. Excluding special items1, annual 2017 operating income was $3.5 billion, compared with $4.0 billion in 2016. Annual 2017 net income was a record $3.5 billion, or a record $5.79 per diluted share, compared with annual 2016 net income of $2.2 billion, or $3.55 per diluted share. Excluding special items1, annual 2017 net income was $2.1 billion, or $3.50 per diluted share, compared with $2.4 billion, or $3.75 per diluted share in 2016. The Company’s annual 2017 effective tax rate was (7.3) percent. Excluding the impact of the fourth quarter 2017 $1.4 billion tax benefit due to tax reform legislation, and other special items1, annual 2017 effective tax rate was approximately 36 percent. For full year 2018, the Company estimates its effective tax rate to be in the 23 to 23.5 percent range, as a result of a lower corporate tax rate, and including the estimated impact of state taxes.

Liquidity and Capital Deployment
As of December 31, 2017, the Company had approximately $3.3 billion in cash and short-term investments, and a fully available unsecured revolving credit line of $1 billion. For 2017, net cash provided by operations was $3.9 billion, and capital expenditures were $2.1 billion, resulting in free cash flow1 of $1.8 billion. Annual 2017 capital expenditures were lower than expected primarily due to approximately $115 million of capital investments that shifted from 2017 into 2018. The Company currently estimates its 2018 capital expenditures will be approximately $1.9 billion. The Company repaid $592 million in debt and capital lease obligations during 2017, and is currently scheduled to repay approximately $337 million in debt and capital lease obligations during 2018. During fourth quarter 2017, the Company issued $300 million of unsecured notes due in 2022 and $300 million of unsecured notes due in 2027.

In 2017, the Company returned approximately $1.9 billion to its Shareholders through the payment of $274 million in dividends and the repurchase of approximately 26.7 million shares of common stock for $1.6 billion. During fourth quarter 2017, the Company returned $350 million to its Shareholders through the repurchase of common stock. The Company repurchased $250 million in common stock pursuant to an Accelerated Share Repurchase (ASR) program launched during fourth quarter 2017 and received approximately 3.32 million shares, representing an estimated 75 percent of the shares expected to be repurchased under that ASR program. Additionally, the Company repurchased approximately 1.63 million shares during fourth quarter 2017 through $100 million in open market transactions. During fourth quarter 2017, the Company also received approximately 1.21 million shares, which remained pursuant to a $300 million third quarter 2017 ASR program. The Company has $1.35 billion remaining under its May 2017 share repurchase authorization.

Fleet and Capacity
The Company ended 2017 with 706 aircraft in its fleet. This reflects the delivery of 39 new Boeing 737-800 aircraft, 13 new Boeing 737 MAX 8 aircraft, and 18 pre-owned Boeing 737-700 aircraft, as well as the retirement of 87 Boeing 737-300 Classic aircraft during the year.

In December 2017, the Company revised its future firm order delivery schedule with Boeing to support future growth opportunities and fleet modernization, at favorable economics. The Company exercised 40 737 MAX 8 options for 15 firm orders in 2019 and 25 firm orders in 2020. The Company deferred 23 737 MAX 7 firm orders from 2019 through 2021 to 12 firm orders in 2023 and 11 firm orders in 2024. The Company also accelerated 23 737 MAX 8 firm orders from 2023 to 2024 to an additional 21 firm orders in 2021 and 2 firm orders in 2022. For 2018, the Company continues to expect to end the year with 750 aircraft in its fleet based on the current aircraft delivery schedule. Additional information regarding the Company’s aircraft delivery schedule is included in the accompanying tables below.

The Company increased its available seat miles by 3.6 percent in 2017, as compared with 2016. The Company expects its 2018 available seat mile year-over-year growth to be in the low five percent range, with first half 2018 year-over-year growth in the low three percent range and second half 2018 year-over-year growth in the low seven percent range. The second half 2018 year-over-year growth rate is significantly impacted by the 2017 retirement of Boeing 737-300 Classic aircraft and the approximately 5,000 flight cancellations due to natural disasters in third quarter 2017.

Notes:

  1. Contract ratification bonuses recorded for certain workgroups. As the bonuses would only be paid at ratification of the associated tentative agreement and would not represent an ongoing expense to the Company, management believes its results for the associated periods are more usefully compared if the impacts of ratification bonus amounts are excluded from results. Generally, union contract agreements cover a specified three- to five- year period, although such contracts officially never expire, and the agreed upon terms remain in place until a revised agreement is reached, which can be several years following the amendable date;
  2. A noncash impairment charge related to leased slots at Newark Liberty International Airport as a result of the Federal Aviation Administration announcement in April 2016 that this airport was being changed to a Level 2 schedule-facilitated airport from its previous designation as Level 3 (a “slot” is the right of an air carrier, pursuant to regulations of the Federal Aviation Administration, to operate a takeoff or landing at a specific time at certain airports);
  3. Lease termination costs recorded as a result of the Company acquiring 13 of its Boeing 737-300 aircraft off operating leases as part of the Company’s strategic effort to remove its Classic aircraft from operations on or before September 29, 2017, in the most economically advantageous manner possible. The Company had not budgeted for these early lease termination costs, as they were subject to negotiations being concluded with the third-party lessors. The Company recorded the fair value of the aircraft acquired off operating leases, as well as any associated remaining obligations to the balance sheet as debt;
  4. An Aircraft grounding charge recorded in third quarter 2017, as a result of the Company grounding its remaining Boeing 737-300 aircraft on September 29, 2017. The loss was a result of the remaining net lease payments due and certain lease return requirements that may have to be performed on these leased aircraft prior to their return to the lessors as of the cease-use date. The Company had not budgeted for the lease return requirements, as they are subject to negotiation with third party lessors; and
  5. An adjustment to Provision for income taxes related to the Tax Cuts and Jobs Act legislation enacted in December 2017, which resulted in a re-measurement of the Company’s deferred tax assets and liabilities at the new corporate tax rate of 21 percent. This adjustment is a non-cash item and is being treated as a special item.

Copyright Photo: Southwest Airlines Boeing 737-7H4 WL N407WN (msn 29817) (Kidd’s Kids – keep lookin’ up) LAX (Michael B. Ing). Image: 940355.

Southwest Airlines aircraft slide show:

Southwest to add more flights to MSP for the Super Bowl

Southwest Airlines Boeing 737-7H4 WL N744SW (msn 29490) SNA (Michael B. Ing). Image: 939564.

Southwest Airlines (Dallas) has added additional nonstop service options between Boston and Minneapolis/St. Paul and between Philadelphia and Minneapolis/St. Paul for football fans traveling to and from the Super Bowl.

The carrier published the following additional flights surrounding a super weekend for football fans:

Friday, Feb. 2, 2018

From

Boston

to

Minneapolis/St. Paul 

(one nonstop flight)

Monday, Feb. 5, 2018

From

Minneapolis/St. Paul

to

Boston

(two nonstop flights)

From

Minneapolis/St. Paul

to

Philadelphia

(two nonstop flights)

Copyright Photo: Southwest Airlines Boeing 737-7H4 WL N744SW (msn 29490) SNA (Michael B. Ing). Image: 939564.

Southwest Airlines aircraft slide show (current livery):