Consistent with its not-so-favorable traffic figures over the
last three months,
Southwest Airlines Co.
) witnessed less traffic and capacity for Feb 2013.
The company's traffic - measured in revenue passenger miles
(RPMs) - was 7.06 billion for the reported month, down 2.3% from
7.23 billion recorded a year ago. On a year-over-year basis,
consolidated capacity (or available seat miles/ASMs) moved down
3.1% to 9.30 billion. The results were negatively impacted by a
drop in the number of passengers traveled and trips undertaken.
The load factor or percentage of seats filled by passengers,
however, went up marginally to 75.8% from 75.2% in Feb 2012.
Passenger revenue per available seat mile (PRASM) also improved
about 2.0% year over year.
For the first two months of this year, Southwest generated RPMs
of 14.31 billion (down 2.0% year over year) and ASMs of 19.29
billion (down 1.3% year over year), while load factor was 74.2%,
reflecting a decline of 60 basis points.
The top-notch passenger airline focuses on a number of
initiatives to increase revenue and reduce costs in the coming
months. Apart from fleet rightsizing, the company is
concentrating on expanding its network routes.
Southwest fortified its foothold in the state of Missouri with
three daily nonstop flights from Branson to Dallas Love Field,
Houston Hobby, and Chicago Midway. There will also be nonstop
flights to Orlando only for Saturdays. The company's foray into
Branson highlights the benefits from the acquisition of AirTran
Airways that was operating in the aforesaid region since 2009.
Dallas, Texas headquartered Southwest Airlines along with AirTran
operated 694 aircraft by
The Boeing Company
) serving 97 cities in 41 states, as of Dec 31, 2012.
Southwest - which operates along with other prominent players
United Continental Holdings
) - currently holds a Zacks Rank #3, implying a Hold rating.
Despite these headwinds such as unstable economic conditions,
competitive pressures, regulatory interferences and technological
failures, we remain encouraged by Southwest's cost-cutting
measures, diversification into untapped territories, revenue
management program and the launch of attractive service
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