21-Oct-2011 12:17 PM

Southwest pleased with progression of AirTran integration: CEO

Southwest Airlines CEO and president Gary Kelly stated (20-Oct-2011) he is "pleased with the overall progress we are making on our AirTran integration". He continued: “We continue to work with the Federal Aviation Administration to obtain our single operating certificate, which we expect to receive in first quarter 2012. We expect to have the capability to connect the networks of both airlines in first half 2012; however, we have already begun to optimise the coordinated flight schedules." Southwest Airlines has incurred USD97 million in costs (before taxes) associated with the acquisition and integration of AirTran during 2011, including USD22 million in 3Q2011. The company expects total acquisition and integration expenses will be approximately USD500 million. The carrier has so far produced USD60 million (before taxes and profitsharing) in annualised cost synergies from the acquisition, primarily attributable to renegotiation of certain AirTran contracts and reduction of corporate overhead. The carrier has a target of net annual pre-tax synergies in excess of USD400 million by 2013. Including the anticipated benefit of net synergies, but excluding the impact of acquisition and integration expenses, the company expects the acquisition to be accretive to its fully-diluted earnings per share for full year 2011. [more - original PR]

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