Southwest Airlines (LUV) Load Factor Fell 0.8 Points in July 2016; Updates Q3 RASM Outlook
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Southwest Airlines Co. (NYSE: LUV) reported its July and year-to-date preliminary traffic statistics.
The Company flew 11.7 billion revenue passenger miles (RPMs) in July 2016, an increase of 1.4 percent from the 11.5 billion RPMs flown in July 2015. Available seat miles (ASMs) increased 2.3 percent to 13.4 billion in July 2016, compared with July 2015 ASMs of 13.1 billion. The July 2016 load factor was 86.9 percent, compared with 87.7 percent in July 2015.
The significant delays and cancellation of over 2,000 flights due to the Company's technology outage on July 20, 2016 resulted in an approximate 0.5 point unfavorable year-over-year impact to third quarter 2016 operating revenue per available seat mile (RASM). As a result, the Company now expects its third quarter 2016 RASM to decline, year-over-year, in the 3.5 percent to 4.5 percent range, versus its previous guidance of a year-over-year decline in the 3.0 percent to 4.0 percent range. The Company has also revised its third quarter 2016 cost outlook to reflect the impact from the technology outage. Third quarter 2016 operating expense per available seat mile (CASM), excluding fuel and oil expense, special items, and profitsharing expense, is now estimated to increase in the 3.0 percent to 4.0 percent range1, as compared with third quarter 2015.
This release, as well as past news releases about Southwest Airlines Co., is available online at Southwest.com.
1Projected results do not reflect the potential impact of special items, or fuel and oil expenses and profitsharing expenses, and the tax effect of all such items because the Company cannot reliably predict or estimate those items or expenses or their impact to its financial statements. Accordingly, a reconciliation of non-GAAP financial measures to the equivalent GAAP financial measures for projected results is not available without unreasonable effort.
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