boxer6

Reading through the daily financial news I came across the article below. It struck me as I recall last falls posts on the merger and SLI between the two groups. I not trying trying to start a flame war on either side but given the comments of CEO Gary Kelly, what are the opinions now, vice last fall, regarding if the Airtran folks were treated fairly given the contributions their operation has provided?

• Net income of $228 million or 30 cents per share, an all-time quarterly record, compared to $161 million or 21 cents per share a year ago.
• Operating revenue increased by nearly 12 percent to $4.62 billion.
• The average fare rose 5 percent to $150.31.

Conference Call Highlights
CEO Gary C. Kelly Comments:

WHACKMASTER

It's no secret that the AT operation's performance is better by most of the measured metrics, but whatever.......... I just hope that SWA management is open-minded enough to learn and utilise some of the factors for that kind of repeated performance.

Anyway, wrt the profit margin based raises on the SWA TFP rates, here are a few questions:

- Are they based off of fiscal year 2012 operating margin?

- What is "fiscal year 2012"

- When will you guys find out if you're getting a 0, 1, 2, or 3% raise?

tr4a

It's 3rd Quarter to 3rd Quarter. (30 Sep) and it's an adjusted operating margin. We will know when earnings are announced in October. The pay raise would retroactive to 1 Sep 2012.

Section 4.C.2
(a) Operating Revenues as set forth in the consolidated statement of income in the annual report to shareholders, adjusted for the following items


1. Any operating revenues of AirTran Holdings that are attributable to the period prior to being a subsidiary of SWA.
(b) Adjusted Operating Expenses will be operating expenses as set forth in the consolidated statement of income in the annual report to shareholders adjusted for the following items.

2. Any operating expenses of AirTran Holdings that are attributable to the period prior to being a subsidiary of SWA.

3. Any one time acquisition or integration costs related to the purchase and integration of AirTran Holdings into Southwest Airlines that are reported as special items in the Company’s quarterly earnings press releases. One time acquisition and integration costs will be disclosed in the “Reconciliation of Reported Amounts to Non-GAAP Items” in the Company’s quarterly earnings press release.

4. If the Company finances aircraft through long term operating leases the adjustment to operating expenses will be as follows:

Operating expenses are decreased by the Aircraft Rental Expense associated with such leases included in the consolidated statement of income in the annual report to shareholders.

Operating expense will be increased for the hypothetical depreciation for such aircraft using the Company’s original cost of said aircraft and the Company’s then current method for computing depreciation for comparable aircraft.

No adjustments shall be made for aircraft leases of AirTran Holdings unless they are new aircraft leases entered into by AirTran Holdings after it is acquired by Company.

No adjustments shall be made for aircraft acquired on short term operating leases.

5. To reflect the economic cost of fuel as defined. Fuel expense calculated on an economic basis reflects only hedging gains or losses for derivative instruments that settled in the current accounting period. Items excluded from economic results primarily consist of ineffectiveness, as defined, related to future period hedging instruments, and changes in market value for future period derivatives that no longer qualify for special hedge accounting, as defined in SFAS 133, but were recognized in GAAP results in the current accounting period. Economic Fuel expense is reported in the “Reconciliation of Reported Amounts to Non-GAAP Items” in the Company’s quarterly earnings press release.