Southwest Airlines made a $111 million profit in the fourth quarter of 2007 but acknowledged it would not have made money without its fuel-hedging gains.
The fourth-quarter net income came to 15 cents per share, an improvement over the company’s $57 million profit, or 7 cents per share, in the year-ago quarter.
Separately, Delta Air Lines Inc., the nation’s No. 3 carrier, said it lost $70 million, or 18 cents a share, compared with a loss of $1.98 billion for the same period a year earlier. The airline did not provide a per- share figure for the prior year, when it was in bankruptcy.
Although Southwest posted profits while other airlines lost money, Southwest chief executive Gary Kelly acknowledged the company is facing challenges.
Amid high fuel costs and “signs of domestic economic weakness,” Southwest has slowed its growth, though it has been rapidly growing in Denver.
“We’ve grown Denver very aggressively because the demand has been there,” Kelly said.
He said while Southwest has added to its capacity in Denver, “remarkably the revenues are up a like amount.”
For all of 2007, Southwest made a $645 million profit, or 84 cents per diluted share, up from $499 million, or 61 cents, in 2006.
As airlines including Delta, United and Northwest consider consolidation, Kelly said Southwest could be “in a pretty good position to take advantage of it” if it has airplanes available to add service.
Southwest also announced it will test in-flight broadband Internet access for customers with Wi-Fi devices in a partnership with satellite in-flight broadband company Row 44. The company hopes to start the tests on four planes this summer.
The Associated Press contributed to this report.
Kelly Yamanouchi: 303-954-1488 or kyamanouchi@denverpost.com
