Southwest Airlines Reports 36th Consecutive Year of Profitability and Fourth Quarter Results

DALLAS , Jan. 22 /PRNewswire-FirstCall/ -- Southwest Airlines (NYSE: LUV) today reported full year 2008 net income of $178 million , or $.24 per diluted share, compared to $645 million , or $.84 per diluted share, for full year 2007. Excluding...

During the fourth quarter of 2008, the Company completed several financing transactions to significantly boost its liquidity. The Company accessed $400 million under its available $600 million revolving credit facility in October 2008 . In addition, the Company borrowed $400 million under a new term loan secured by 17 aircraft and borrowed $91 million under a new line of credit secured by a portion of its auction rate securities in December 2008 . The Company also entered into a two tranche sale and leaseback transaction for ten of the Company's Boeing 737-700 aircraft. The first five aircraft tranche closed in December 2008 and the second tranche closed in January 2009 , each for a total of $173 million. The Company repaid $55 million in debt during 2008 and currently has minimal contractual debt payment obligations in 2009. After posting $240 million in cash collateral at December 31, 2008 , the Company ended the year with $1.8 billion in unrestricted cash and short-term investments. In addition, the Company had its remaining fully available unsecured revolving credit line of $200 million.

This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Specific forward-looking statements include, without limitation, statements relating to the Company's anticipated revenues and costs and its growth strategies and expectations. These forward-looking statements are based on the Company's current intent, expectations, and projections and are not guarantees of future performance. These statements involve risks, uncertainties, assumptions, and other factors that are difficult to predict and that could cause actual results to vary materially from those expressed in or indicated by them. Factors include, among others, (i) the price and availability of aircraft fuel and any changes to the Company's fuel hedging strategies and positions; (ii) uncertainties surrounding domestic economic conditions, which can impact the demand for air travel and the Company's ability to adjust fares; (iii) competitor capacity and load factors; (iv) the Company's ability to timely and effectively prioritize its revenue and cost reduction initiatives and its related ability to timely implement and maintain the necessary information technology systems and infrastructure to support these initiatives; (v) the impact of governmental regulations and inquiries on the Company's operating costs, as well as its operations generally; and (vi) other factors, as described in the Company's filings with the Securities and Exchange the Company's Commission, including the detailed factors discussed under the heading "Risk Factors" in Annual Report on Form 10-K for the fiscal year ended December 31, 2007 .

SOURCE Southwest Airlines

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