Southwest to issue new shares for employees; ATA reports fourth month of revenue improvement
North and South American carriers' stock gained on Friday (21-May-2010) in line with broader markets (Dow +1.3%), and as oil prices (-1.1%) continued to slide, to USD70.04. The AMEX Airline Index (+2.9%) rose.
- North and South American carriers' stock gained on Friday, in line with broader markets and as oil prices continued to slide.
- Southwest Airlines plans to issue 12 million shares for an employee incentive plan, following a vote by shareholders to triple the company's stock-incentive program.
- Air Canada and US Airways experienced significant gains in their stock prices, while UPS and TAM ended the session down.
- Porter Airlines delayed announcing details of its proposed IPO, with plans to raise CAD120 million for the purchase of new aircraft.
- The Air Transport Association of America reported a fourth consecutive month of revenue growth for US carriers, with passenger revenue rising 12.5% year-on-year in April 2010.
- The ATA president highlighted the positive sign of the April jump in passenger revenue, indicating a gradual recovery of the US aviation industry from last year's depressed levels.
Southwest to issue 12 million shares for employee incentive plan
Southwest Airlines (+2.1%) announced plans to issue 12 million shares or approximately 1.6% of total shares for use in an incentive plan for employees, directors and advisers, following a vote by shareholders to triple the company's stock-incentive programme in addition to the original 6 million. The plan has been used to grant 3.7 million stock options in the past, including 450,000 to Chairman and CEO, Gary Kelly, and 170,000 and 165,000 respectively to Executive Vice-Presidents, Ron Ricks and Michael Van de Ven.
Elsewhere, Air Canada (+9.0%) made the day's biggest gain, bouncing back after heavy falls earlier in the week. US Airways (+5.4%) also made a strong gain, while UPS (-1.7%) and TAM (-0.7%) were the only carriers to end the session down.
Porter Airlines delays details of IPO
In Canada, Porter Airlines delayed announcing details of its proposed IPO until 27-May-2010, with reports the carrier will seek to raise CAD120 million with 17-20 million shares to be released at CAD6-CAD7 each. Porter plans to use funding from the IPO to finance the purchase of seven new Bombardier Q400 turboprops over the next year.
ATA reports fourth consecutive month of revenue improvement for US carriers
The Air Transport Association of America (ATA) reported during trading that US airline passenger revenue, based on a sample group of carriers, rose 12.5% year-on-year in Apr-2010 - marking the fourth consecutive month of revenue growth.
Approximately 0.5% more passengers travelled on US airlines during the month, while the average price to fly one mile rose nearly 14%. International passenger revenue rose 15%, led by a 37% gain in transpacific markets.
ATA President and CEO, James C. May stated "the April jump in passenger revenue is a positive sign, and one showing that the US industry is recovering gradually from last year's severely depressed levels. Last year, domestic round-trip fares averaged USD28 less than they did a decade earlier. In fact, year-ago fares were a staggering USD117 short of keeping pace with inflation".
America Airline Daily is your one-stop shop for news, data and analysis from the dynamic North American, Caribbean and Latin American aviation markets. Other stories featured in today's issue include:
- American Airlines reaches impasse with flight attendants;
- Atlantic Southeast Airlines launches new brand identity;
- Spirit Airlines starts service between Detroit and Atlantic City;
- FAA authorisation bill to be finalised by Jul-2010;
- Avianca to add additional services during summer holiday.
North & South America selected airlines daily share price movements (% change): 21-May-2010
Source: Centre for Asia Pacific Aviation & Yahoo! Finance