Published on : Monday, July 30, 2018
The Dallas-based airline spent 40 percent more on fuel, but losses last year and gains this year on hedging — it’s like buying insurance against price spikes — made the fuel impact look much smaller at Southwest.
In April, a woman died on a Southwest flight when an engine tore apart and a piece struck her window, breaking it — the airline’s first passenger fatality from an accident. Southwest stopped advertising for a time, and the airline said Thursday that led to a $100 million loss of revenue.
Southwest Airlines might also have been forced to discount prices to keep planes full. The average second-quarter fare was 4 percent lower than a year ago, down to $151.94.
CEO of South west Airlines Gary Kelly said travel demand has been strong and the impact of the accident on sales should subside in the third quarter for the nation’s fourth-biggest carrier.
The adjusted profit was $1.26 per share, 3 cents better than the forecast of analysts surveyed by FactSet.