Southwest Airlines has already released its most recent earnings reports and the company’s Q2 earnings look bright. For the second quarter of the year, the company has exceeded its forecasts, in part helped by lower fuel prices.
The Dallas-based airline company’s earnings per share increased marginally above the predictions that analysts had made, contributing to an increase in profit of 31 percent over that which Southwest had earned in 2014.
But it wasn’t just fuel prices drops that helped Southwest Airlines achieve better profits this quarter. The company has also tweaked its operating costs and this seems to have benefitted Southwest greatly.
Reports show that, during the second fiscal quarter of 2015, the airline’s traffic grey by 7.9 percent and its capacity also rose by 7 percent. Southwest also managed to achieve higher seat per trip averages, a significant improvement.
In total, Southwest reported earnings of $608 million during the last quarter, which amounts to $1.03 per diluted share. Analysts had been expecting that Southwest would have a year-over-year profit increase of approximately 46% to $1.02 per diluted share.
After 45 years of Service, Southwest Airlines employs over 47,000 people and serves 100 million customers per year. Last quarter, the Dallas-based company had a net profit margin of 10.26 percent and an operating margin of 17.67 percent. It experienced revenue decreases in Q1 though, as its year-over-year revenue fell by 12.17%.
Over the past 52 weeks, Southwest Airlines’ stock has been trading between $27.42 and $47.17. On July 23rd at 8:55 AM EDT, its shares had increased 0.04% to $35.13.
Hopefully, demand will remain strong in the next quarter and contribute to an even greater profit increase. Southwest has announced its intentions of decreasing unit costs by approximately 1 percent in Q3, as will fuel prices, which are expected to reach $2.20 per gallon.
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