Southwest Airlines sees improvements in unit revenues

Southwest Airlines released the following commentary by President and CEO, Gary Kelly, and CFO, Lauren Weight, on its 3Q2009 financial results (Seeking Alpha, 15-Oct-2009):

• Unit Revenue:
  
  • "Consistently outperformed the industry. Finally we've really surged ahead even further in September and so far in October [and] we seem to be sustaining that momentum," Gary Kelly;
  • "Our unit revenues declined 2.2% year over year, which was far better than we expected just 90 days ago, again thanks to the actions we have taken to grow our revenues… we are gaining a substantial amount of customers and revenues by differentiating ourselves in a meaningful way from other carries," Laura Wright.
• Load Factors: "Consistently running at record levels and in some cases beating some longstanding previous records," Gary Kelly;
• Demand: "The majority of the demand is in the discount category… there's no evidence of any significant change in business travel demand, i.e. full fare demand…we are looking at advanced bookings that are discount oriented and being driven by our low fare brand and a pretty big push with our advertising campaign too. And the good news is that that play is working for us and it appears that it will continue for the foreseeable future but certainly there is no visibility much beyond December that you can count on. But right now the bookings for October/November/December, at least what we have in place, are quite good and again, no doubt at lower fares than a year ago." Gary Kelly;
• Outlook: "We see ourselves as a growth company. Now is not the time to grow, of course. Hopefully the economy will in fact improve, travel demand will strengthen. We'll be a low fare, low cost carrier that's pre-eminent in the US and we'll have ample opportunities to grow our route map, not only in the US but also in the near international markets and - so we are thinking about our future along those lines," Gary Kelly.