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Southwest Airlines expects momentum to continue for next two quarters

22-Oct-2010 2:09 PM

Southwest Airlines CEO, Gary Kelly, forecast the carrier would continue to show revenue growth in 4Q2010 and has momentum building up for year-on-year improvement 1Q2011. CFO Laura Wright stated that while bookings for the remainder of Oct-2010, as well as Nov-2010 and Dec-2010, “look strong”, the carrier’s year-on-year comparisons for Nov-2010 and Dec-2010 may be more difficult due to its CASM acceleration last year (Seeking Alpha, 21-Oct-2010). She added the carrier may have more difficult year-on-year capacity comparisons for 4Q2010. However, the CFO noted Southwest’s bookings, price and sequential revenue trends for Oct-2010 so far “indicate sustained momentum of our year-to-date revenue results”. Southwest expects another year-on-year increase in revenues for 4Q2010, but at a lower rate to 3Q2010, as the carrier reported USD24 million in ancillary revenue in 4Q2009 versus USD12 million in 3Q2009 for the same initiatives.