Q3 Results?
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BoeingBoy
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Not a clue, but the First Call consensus is for a loss of $2.38/share before special items. That works out to a loss of ~$265 million before special items. One of the special items will be the stock sale that netted ~$179 million, dropping the consensus net loss to less than $100 million.
Jim
Jim
SWA lost 120 million and CAL 239 mil.
I would think we (US) are looking at something just under 300 (270-290)?
SW loss (thier first in 17 years) was kind a ironic they loss becuase of fuel hedging.
If oil were to stabilize at around $50 for a few years they will get killed becuse they are hedge further out then anyone. Somthing like 50% for next year at $90.
I would think we (US) are looking at something just under 300 (270-290)?
SW loss (thier first in 17 years) was kind a ironic they loss becuase of fuel hedging.
If oil were to stabilize at around $50 for a few years they will get killed becuse they are hedge further out then anyone. Somthing like 50% for next year at $90.
BoeingBoy
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Your right the 50% at $90 is 2010, I got may dates mixed up.
By the way they also announced today their first major cuts ever a 6% flying pulldown.
They also have the fastest rising cost and a quickly aging workforce. The 10% a year constant growth hid a lot of that.
Their credit was just reduced from AAA to BBB+ (Still the best in the airline biz).
So while they are the best run airline they are not immune from market forces.
By the way they also announced today their first major cuts ever a 6% flying pulldown.
They also have the fastest rising cost and a quickly aging workforce. The 10% a year constant growth hid a lot of that.
Their credit was just reduced from AAA to BBB+ (Still the best in the airline biz).
So while they are the best run airline they are not immune from market forces.
wings396
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The aging workforce is an interesting issue. Many have brought up the point of SWA's fleet workers hourly wage of $24, but fail to realize that very few are at that point. Sooner or later it is going to catch up to them just like it has everyone else.
BoeingBoy
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Actually, a 5-6% capacity reduction for the 1st quarter. They're still planning on adding a net of up to 10 new aircraft next year, giving them the flexibility of add back capacity if conditions warrant.
AA - Op Exp up 17.9% YoY
CO - Op Exp up 21.7% YoY
DL - Op Exp up 17.1% YoY
WN - Op Exp up 20.0 % YoY
Looks like WN's increase in Op Expenses is in the ballpark with the legacies that have reported so far, plus the legacies' percentage increase is from a higher base - 17% of a bigger number can be more than 20% of a smaller number.
Gee - I never realized that WN employees aged faster than legacy employees!! Seriously though, I understand what you're getting at. A reduction or even halt in hiring at WN means that the average age of their employees goes up faster than when they're constantly hiring for growth. Wonder what effect furloughing has on the average age of the employees at the legacies...
"Still the best in the airline biz" covers that subject nicely.
Correct, and I doubt that they've ever said that they are immune. Good management just allows them the luxury of being better prepared to weather changing market forces. Take fuel hedges as just one example - WN knows what they'll be paying at most for 75% of their fuel next year. They've made fuel a largely fixed cost that can be planned for. Should fuel prices drop below their hedged price, they're still ahead. The legacies, that far ahead, are largely guessing what fuel cost will be when they set prices. Fuel is still a largely variable cost for them so they can only set prices and hope for the best.
Jim
jimntx
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Correction. The SWA "loss" was an "on paper" loss. They actually had a profit of $69 million before the "writedown" of the value of their fuel hedges. No money actually went out the door for the $120 million.
The rest of us are quick to use "special items" to show a profit or blame that same item for a loss. Why can't SWA? AMR showed a net profit for the quarter, but that was due to the sale of American Beacon (?) for $432 million. Without that sale (special item because it's a one off deal) we would have lost $360 million.
As far as losses, compare the size of the losses and the size of the respective airlines then decide who did better or worse. A $50 million loss at an airline the size of Frontier is decidedly worse, for instance, than a $150 million loss at AMR.
InternationalShannon
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THE RESULTS ARE IN!! WE CLEARED 500 BILLION DOLLARS!!! YAY!!!
Not really. 😛h34r:
Not really. 😛h34r:
BoeingBoy
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You would be correct that Ops Exp include the hedged cost of fuel (WN doesn't use a line item for settled hedge gains/loses on the income statement). However, with fuel expense still up 51.5% YoY, you would be wrong to assume that labor costs "really went up". The change in labor expense was 2.9% - not much more than the 2.2% increase in capacity.
Jim
Jim
Dog Wonder
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That is EXACLLY what the Noble prize winner in Ecconommics predicted last year.
He is now up for the Noble prize in Littrature for putting the "C" in vodca.
jimntx
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IS, are you sure you are only taking those pain pills on schedule and according to the specified dose? 🙄
