Originally Posted by Reese

Southwest Airlines Reports Fourth Quarter Profit And Full Year Results – Southwest Airlines (southwestairlinesinvestorrelations.com)
On it's most recent quarter, Southwest lists current assets at $18B, with $12.5B in cash/cash equivalents.
It also lists its current debts as $9.2B, and it's long term debt minus current maturities as $10.2B.

The interest on that long term debt of $10.2B comes with a $450M payment per quarter, up from $220M a year earlier. So the statement of paying off "all debt" isn't true.

I know the company says they have $15.5B in cash on hand, and $10.7B in liabilities, with a $4.8B net positive cash position. But pretty sure it's a spin job to a certain extent. TECHNICALLY, they can't pay off their long term debt with the cash they have on hand.

Of note, long term debt at the end of 2019 was ~$1.8B, and cash on hand was ~$4B. That cash on hand grew by $10B when they took out $10B in long term debt during the spring of 2020.

1Q 2020
"As of March 31, 2020, the Company had approximately $5.5 billion in cash and short-term investments, including proceeds of $500 million of unsecured notes due 2030, issued February 10, 2020; $1.0 billion from a 364-day secured term loan, entered into March 12, 2020; and $1.0 billion drawn from the Company's revolving credit facility on March 16, 2020, which was subsequently secured. On March 30, 2020, the Company renegotiated its $1.0 billion 364-day term loan to add additional funds of approximately $2.3 billion, which were received on April 1, 2020. On April 24, 2020, the Company received another $350 million in funds pursuant to its approximately $417 million accordion provision as part of the 364-day term loan agreement. Since the beginning of 2020, the Company has bolstered cash on hand by $6.8 billion as of April 24, 2020, including $1.6 billion of PSP proceeds, with the remaining $1.6 billion of PSP proceeds expected to be received by July 2020."
2Q 2020
"As of June 30, 2020, the Company had approximately $14.5 billion in cash and short-term investments, and a fully available revolving credit facility of $1.0 billion. Since the Company's previous update of cash and short-term investments of approximately $13.9 billion as of June 17, 2020, the Company received its third disbursement of PSP proceeds in the amount of $652 million. The remaining $326 million of PSP proceeds is expected to be received by the end of this month. Since the beginning of 2020, the Company has raised cash of approximately $17.3 billion, net of fees, including $12.2 billion in financings and sale-leaseback transactions, $2.2 billion through a common stock offering, and $2.9 billion of PSP proceeds. The Company currently has unencumbered assets worth approximately $12 billion, including approximately $10 billion in aircraft. As of June 30, 2020, the Company was in a net cash position5 of $4.9 billion, and its adjusted debt6 to average invested capital (leverage) was 49 percent."

Second, out of genuine curiosity, i've tried finding it. Can you give me a link on the fuel hedging?

Originally Posted by Smooth at FL450

If they paid off all their debt tomorrow, there is no interest payment to service the debt. So how is what I said incorrect?

Fuel hedging details are in pages 112-117 of the recent 10-k

Originally Posted by Reese

found it. And yes, ~2/3s hedged through 2022 at ~$2.35-2.45/gal, the rest at market.

Recent oil spikes will result in jet fuel going as high as $3.45/gal and potentially higher.

(d) Based on the Company's existing fuel derivative contracts and market prices as of January 20, 2022, full year 2022 economic fuel costs are estimated to be in the $2.25 to $2.35 per gallon range, including fuel hedging premium expense of approximately $96 million, or $0.05 per gallon, and $0.28 per gallon in favorable cash settlements from fuel derivative contracts. See Note Regarding Use of Non-GAAP Financial Measures.“While many European carriers seek protection from fuel-cost spikes by locking in prices, American, United and Delta don’t use such hedging contracts on their airline operations. Southwest is an exception and has 64% of its fuel needs hedged for this year. Alaska Air Group Inc. hedges about 50% of its expected consumption.”

Originally Posted by ROFF

Wonder if they’re still going to fix the Wifi and IT issues they’ve been laser focused on.

Originally Posted by ROFF

Wonder if they’re still going to fix the Wifi and IT issues they’ve been laser focused on.

Originally Posted by ROFF

Wonder if they’re still going to fix the Wifi and IT issues they’ve been laser focused on.

Originally Posted by tm602

What do you guys think? Contract issues aside (for these purposes anyway), what do you see? Slow or stop on hiring? Furloughs? Business as usual? Oil will probably hit $200 a barrel. The current "recovery" from a previously thriving economy is hitting wallets hard. So, you're predictions?