Southwest Airlines records travel demand improvement, estimates 20 months of liquidity

Southwest Airlines reported (19-May-2020) a modest improvement in passenger demand, bookings and trip cancellations as of 18-May-2020. For May-2020, the airline anticipates operating revenue decline between 85% to 90% year-on-year (compared to previous estimations of between 90% and 95%), capacity cuts between 60% to 70% and load factors in the range of 25% to 30% (compared to previous estimations of between 5% to 10%). For Jun-2020, the airline anticipates operating revenue decline between 80% to 85%, capacity cuts in the range of 45% to 55% and load factors between 35% and 45%. Southwest expects average daily core cash burn to be approximately USD25 billion in 2Q2020, with an estimated cash burn in the low USD20 million range in Jun-2020. The carrier holds cash and short term investments of approximately USD13 billion, and has repaid approximately USD2 billion of its 364 day secured term loan and full USD1 billion under its revolving credit facility. Southwest estimates it has approximately 20 months worth of liquidity. [more - original PR]