Southwest Reports Net Loss Due to Fuel Hedges
#1
Gets Weekends Off
Thread Starter
Joined APC: Oct 2006
Position: Home with my family playing with my daughter as much as possible
Posts: 591
Southwest Reports Net Loss Due to Fuel Hedges
Its getting ugly out here....
Southwest Reports Net Loss Due to Fuel Hedges - Earnings * US * News * Story - CNBC.com
Southwest Airlines reported a quarterly net loss on Thursday, reversing a year-ago profit, on charges related to its fuel hedging program.
RELATED LINKS
Current DateTime: 04:41:42 16 Oct 2008
LinksList Documentid: 27212566
The low-cost airline's third-quarter net loss amounted to $120, or 16 cents per share, compared with a profit of $162 million, or 22 cents per share, a year earlier.
Excluding one-time items, Southwest earned $69 million, or 9 cents per share, beating the average Wall Street estimate of 7 cents per share, according to Reuters Estimates.
The airline industry has been severely battered this year by soaring fuel costs that peeked at a record high in July before falling rapidly.
Southwest, cnbc_comboQuoteMove('popup_LUV_ID0EDAAC15839609');[LUV 11.56 -0.76 (-6.17%) ]cnbc_quoteComponent_init_getData("LUV","WSODQ_COMP ONENT_LUV_ID0EDAAC15839609","WSODQ","true","ID0EDA AC15839609","off","false","inLineQuote"); whose fuel hedges are the envy of the industry, was somewhat insulated from the spike in fuel prices but reported charges of $247 million related to adjustments on a portion of the future period of its hedge portfolio.
The airline's revenue rose about 12 percent to $2.9 billion. The company ended the quarter with $3.4 billion in cash and short term investments.
For The Latest Earnings News, Click Here
Copyright 2008 Reuters
Southwest Reports Net Loss Due to Fuel Hedges - Earnings * US * News * Story - CNBC.com
Southwest Airlines reported a quarterly net loss on Thursday, reversing a year-ago profit, on charges related to its fuel hedging program.
RELATED LINKS
Current DateTime: 04:41:42 16 Oct 2008
LinksList Documentid: 27212566
- [*]
The low-cost airline's third-quarter net loss amounted to $120, or 16 cents per share, compared with a profit of $162 million, or 22 cents per share, a year earlier.
Excluding one-time items, Southwest earned $69 million, or 9 cents per share, beating the average Wall Street estimate of 7 cents per share, according to Reuters Estimates.
The airline industry has been severely battered this year by soaring fuel costs that peeked at a record high in July before falling rapidly.
Southwest, cnbc_comboQuoteMove('popup_LUV_ID0EDAAC15839609');[LUV 11.56 -0.76 (-6.17%) ]cnbc_quoteComponent_init_getData("LUV","WSODQ_COMP ONENT_LUV_ID0EDAAC15839609","WSODQ","true","ID0EDA AC15839609","off","false","inLineQuote"); whose fuel hedges are the envy of the industry, was somewhat insulated from the spike in fuel prices but reported charges of $247 million related to adjustments on a portion of the future period of its hedge portfolio.
The airline's revenue rose about 12 percent to $2.9 billion. The company ended the quarter with $3.4 billion in cash and short term investments.
For The Latest Earnings News, Click Here
Copyright 2008 Reuters
#2
HOSED BY PBS AGAIN
Joined APC: Mar 2005
Posts: 1,713
This CAN'T be true. SWA will NEVER lose money according to some on this forum.............. Welcome to the party guys.............
And NO, I don't hate SWA.... I have a lot of good friends there. It's just that many thought this day would never come.....and low and behold, it did. (At least the numbers aren't that bad....yet). Kinda like getting sucker punched, isn't it?
And NO, I don't hate SWA.... I have a lot of good friends there. It's just that many thought this day would never come.....and low and behold, it did. (At least the numbers aren't that bad....yet). Kinda like getting sucker punched, isn't it?
Last edited by ewrbasedpilot; 10-16-2008 at 04:11 AM.
#4
HOSED BY PBS AGAIN
Joined APC: Mar 2005
Posts: 1,713
Yep, it sure is................. and even though oil has dropped dramatically, the economy sure isn't going to be producing passengers like it used to. Looks like fares will HAVE to drop if we expect any passengers for the holiday season.
#5
Gets Weekends Off
Joined APC: Jul 2007
Position: EMB 190 FO
Posts: 115
Its just a paper loss, excluding "accounting charges" it is still a 69 million dollar profit
http://www.nytimes.com/2008/10/17/bu...3E%3C/TABLE%3E
http://www.nytimes.com/2008/10/17/bu...3E%3C/TABLE%3E
#7
Its just a paper loss, excluding "accounting charges" it is still a 69 million dollar profit
http://www.nytimes.com/2008/10/17/bu...3E%3C/TABLE%3E
http://www.nytimes.com/2008/10/17/bu...3E%3C/TABLE%3E
#8
Gets Weekends Off
Joined APC: Feb 2008
Posts: 19,273
Its not actually a paper loss in this case. It is a actual loss dealing with fuel hedges. Other airlines are also taking losses on fuel hedges. Any fuel you have hedged above 75 a barrel is now underwater and a liability for accounting purposes. A paper loss would be something like a writedown in good will value of the airline based on declining stock value. Hedges are a two way street. You make money when fuel goes up and you lose money when fuel goes down. Its real not paper money.
Thread
Thread Starter
Forum
Replies
Last Post