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Between 2011 and 2014, Southwest Airlines (NYSE: LUV) took a hiatus from growth. It increased its capacity less than 2% over that three-year period as it struggled with high fuel prices and focused on integrating its AirTran acquisition.
Having more or less completed the AirTran acquisition by the end of 2014, Southwest has returned to growth in 2015. Fortuitously, Southwest is doing so just as it is reaping a big tailwind from lower fuel costs. In other words, Southwest couldn't have picked a better time to start growing again.
Return to growth
Last fall, Southwest revealed plans to accelerate its capacity growth rate to 6% in 2015. To some extent, this growth plan was driven by the company's ability to return to a more normal aircraft usage pattern after having many planes out of service due to the AirTran integration. But it also reflected attractive growth opportunities.
The biggest of these -- representing about half of Southwest's projected 2015 growth -- was the opening of Dallas Love Field to long-haul flights, which occurred last October. American Airlines (NASDAQ: AAL) has absolutely dominated the Dallas-Fort Worth air travel market for the past decade because of restrictions that sharply limited long-haul flights at Love Field, Southwest's home airport.
However, Southwest was convinced that there was massive pent-up demand for long-haul flights out of Love Field. The new routes performed so well in their first few months that Southwest acquired two more Love Field gates in late January in order to expand further. In a classic version of the "Southwest Effect," lower prices have also stimulated traffic for American Airlines in the Dallas-Fort Worth market.
As a result of getting the extra gates in Dallas, Southwest now expects its full-year capacity to rise about 7% year over year. It also expects to grow capacity by at least 5% next year because of the impact of annualizing the new routes added during 2015.
Rising profitability
Growth usually puts pressure on an airline's profitability in the short run. It can take a couple of years for demand to fully ramp up as customers discover the new flights and change their travel patterns.
However, thanks to the massive drop in fuel prices -- and to a lesser extent, improved efficiency -- Southwest reported a stellar 17.4% operating margin last quarter. This was up by more than 10 percentage points year over year despite Southwest increasing its capacity by 6.0%.
A great time to grow
Southwest's stellar Q1 results show the wisdom of targeted growth in the current domestic airline market. Costs are falling because of the sharp drop in oil prices since last summer, while domestic travel demand remains robust.
Southwest hopes to hold unit revenue flat this year. Even if it falls short of this ambitious target, it will still be better off than if it had adopted a modest growth rate. After all, it is earning a very high 25.6% return on invested capital. When a company is earning a very strong return on invested capital like that, investing in growth is clearly in shareholders' best interests.
There are still plenty of doubters
Not all Wall Street analysts see it that way, though. Southwest Airlines CEO Gary Kelly still had to fend off a couple of questions during the earnings call about why the company was growing so quickly.
What really seems to be happening is that American Airlines and its legacy peers have reduced their capacity plans recently in order to bolster their unit revenue, and some analysts were hoping Southwest would follow suit.
Southwest isn't facing the same pressures as the legacy carriers, though. For example, passenger unit revenue declined 1.7% last quarter at American Airlines, whereas it was flat at Southwest. For Q2, American expects its passenger unit revenue to decline 4%-6%, while Southwest expects a more modest decline of perhaps 2%.
American Airlines has been fairly up-front about the fact that Southwest's rapid growth in Dallas (and elsewhere, to a lesser extent) is one of the factors depressing its unit revenue right now. But from Southwest's perspective, this is very profitable growth. As long as it is earning a better than 20% return on invested capital, Southwest should keep pushing the pace on expansion -- regardless of the impact on its competitors.
This $19 trillion industry could destroy the Internet
One bleeding-edge technology is about to put the World Wide Web to bed. And if you act right away, it could make you wildly rich. Experts are calling it the single largest business opportunity in the history of capitalism... The Economist is calling it "transformative"... but you'll probably just call it "how I made my millions." Don't be too late to the party -- click here for one stock to own when the Web goes dark.
Adam Levine-Weinberg has no position in any stocks mentioned.
The Southwest Corridor light rail project is now expected to cost $2 billion — $341 million more than the prior estimate, the Metropolitan Council said Monday.
Most of the additional cost was attributed to ground conditions along the route and soil contamination in St. Louis Park and Hopkins.
"The additional costs for the Southwest LRT Project pose significant challenges for our funding partners and taxpayers," Met Council Chair Adam Duininck said in a statement on the new cost estimate. "I will be talking to our funding partners, local communities and legislative leaders to determine the future of this project — all options are on the table."
The Met Council said that additional testing and engineering work filled in planning for the project, from a 1 percent level of detail to a 30 percent level of detail. Those new details include:
• 80 percent increase in retaining walls identified, as well as bridges and connecting roads.
• Redesign to accommodate poor ground conditions along the length of the corridor.
• Redesign to accommodate wetlands, flood plains and drainage areas, primarily in Eden Prairie.
• Acquire 137 acres of property, up by 11 acres from 126.
• Redesign to address rail safety requirements, including five gated LRT crossings and five shared freight rail and LRT crossings.
Gov. Mark Dayton said he was "shocked and appalled" to learn of the big jump in the line's expected cost.
"The continuing escalation of the costs to design and build this line raise serious questions about its viability and affordability," Dayton said in a statement, adding the Met Council board "should quickly review other options for providing much-needed public transit to this region of the metro area."
Duininck said he has asked planners to look for cost savings on the project to reduce the increase.
Trains are now expected to start rolling on the Minneapolis-to-Eden Prairie line by 2020 instead of 2019.
The ballooning costs are the latest in a series of obstacles for the project, which had an estimated price tag of $1.25 billion just two years ago. Since then, it has faced a series of delays due to opposition from Minneapolis residents concerned it would harm nearby lakes and a popular recreation trail.
The city and the Metropolitan Council eventually agreed to bury the trains in a $130 million dollar tunnel as they pass between Cedar Lake and Lake of the Isles. The Met Council struck a separate deal with the Minneapolis Park Board, which was concerned that the trains would detract from the scenic channel of waters between two lakes.
In addition to the problems raised by the latest cost estimates, the project also faces two lawsuits — one from a group of Minneapolis residents, and another from the owner of a Minnetonka apartment complex.
The new details and cost estimates are scheduled to be included in a Supplemental Draft Environmental Impact Statement, originally scheduled for January of 2014, now expected in May.
The Met Council has already spent $59 million on project planning.
Light rail is still the best option to meet transit needs in the southwest metro, but the project's expenses need to be reduced, Hennepin County Commissioner Peter McLaughlin said.
McLaughlin supports the southwest light rail project but acknowledged the jump in expected cost is a "huge setback. We're going to have to find ways to make the thing work."
Published: April 28, 2015 2:36 pm
Southwest Airlines canceled nine early-morning Baltimore flights Tuesday — five departures and four arrivals – in reaction to the civil unrest that hit the city Monday evening, the carrier said.
“This allowed us to ensure adequate staffing and gave Southwest employees (and customers) the opportunity to make arrangements for school being cancelled, and potentially, that transit could be closed,” a Southwest spokeswoman said Tuesday afternoon.
“Operations and staffing are business-as-usual now, and we do not anticipate additional cancellations,” she said.
Southwest operates between 215 and 220 weekday departures at Baltimore-Washington International Thurgood Marshall Airport.
Rioting and looting broke out Monday in Baltimore after the funeral of a black man who suffered injuries while in police custody and subsequently died. The Maryland governor has called out the Maryland National Guard, and a curfew is in effect. Public schools, other institutions and some businesses were closed Tuesday.
HOUSTON (KTRK) --
Police are investigating a murder at southwest Houston hotel.The crime scene is located at the Sun Suites Inn in the 3100 block of West Sam Houston Parkway South.
Witnesses tell Eyewitness News they heard an argument followed by four gunshots.
Detectives are still trying to piece together details of the shooting.
Keep checking back on this page to get real-time updates as this story unfolds. To get alerts for breaking news, download the ABC-13 news app for iPhone or Android. You can also get breaking news alerts sent to you by email.
(Copyright ©2015 KTRK-TV/DT. All Rights Reserved.)
Chairman and CEO Gary Kelly listens to a question during the opening last year of Southwest Airlines’ system operations center in Dallas. (Terry Maxon/DMN)
Naysayers may point out that Southwest Airlines chairman, president and CEO Gary Kelly was paid more than $5 million in cash, stock and other compensiation in 2014.
Related
Fortune Magazine offers the counterpoint: His pay is modest compared to heads of other companies.
As a result, Fortune put him at the top of five CEOs that it calls the most underrated.
“Kelly’s pay is still relatively modest,” Fortune said. “His base salary is well below his peers, at his request. And the company has the chutzpah to award a discretionary cash bonus, recognizing, as many companies do, that sometimes things come along that aren’t recognized by ‘official’ objective bonus plans. The discretionary bonus is not large, a few hundred thousand dollars. This all adds up to restrained pay for exceptional performance.”
The magazine noted that he got a 25 percent pay raise in 2014, while total stockholder return was 126 percent, net income grew 51 percent and the return on capital was 16 percent,.
“Since Gary Kelly was appointed as CEO, Southwest has outperformed every one of its rivals: Jet Blue, United Continental, American Airlines, Virgin America, Delta,” Fortune said.
Although Fortune doesn’t mention it, Kelly is having to deal with the unhappiness of labor groups that have been negotiating new contracts for years. But it noted that Southwest employees will divide up $355 milllion in profit sharing based on 2014 profits.
“That’s the equivalent of five weeks’ pay for the average employee and represents the largest total dollar amount Southwest has ever allocated to the plan,” the magazine said.
As it so happens, CEO #2 on Fortune’s list is Brad Tilden, Alaska Air Group’s president and CEO.
“Who is responsible for Alaska Air’s good fortune? Bradley Tilden, who has been piloting the company as CEO for almost three years. The stellar performance at Alaska Air has led to a pay bump for Tilden of only 18%, from $2.9 million to $3.5 million in 2014, according to figures provided by Equilar.,” Fortune said.
“Tilden’s base salary is set below the 25th percentile for the industry; in other words, three-quarters of his peers are paid more than he is. Most companies target their CEO’s pay in the 50th percentile or higher,” it noted.
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Between 2011 and 2014, Southwest Airlines (NYSE: LUV) took a hiatus from growth. It increased its capacity less than 2% over that three-year period as it struggled with high fuel prices and focused on integrating its AirTran acquisition.
Having more or less completed the AirTran acquisition by the end of 2014, Southwest has returned to growth in 2015. Fortuitously, Southwest is doing so just as it is reaping a big tailwind from lower fuel costs. In other words, Southwest couldn't have picked a better time to start growing again.
Return to growth
Last fall, Southwest revealed plans to accelerate its capacity growth rate to 6% in 2015. To some extent, this growth plan was driven by the company's ability to return to a more normal aircraft usage pattern after having many planes out of service due to the AirTran integration. But it also reflected attractive growth opportunities.
The biggest of these -- representing about half of Southwest's projected 2015 growth -- was the opening of Dallas Love Field to long-haul flights, which occurred last October. American Airlines (NASDAQ: AAL) has absolutely dominated the Dallas-Fort Worth air travel market for the past decade because of restrictions that sharply limited long-haul flights at Love Field, Southwest's home airport.
However, Southwest was convinced that there was massive pent-up demand for long-haul flights out of Love Field. The new routes performed so well in their first few months that Southwest acquired two more Love Field gates in late January in order to expand further. In a classic version of the "Southwest Effect," lower prices have also stimulated traffic for American Airlines in the Dallas-Fort Worth market.
As a result of getting the extra gates in Dallas, Southwest now expects its full-year capacity to rise about 7% year over year. It also expects to grow capacity by at least 5% next year because of the impact of annualizing the new routes added during 2015.
Rising profitability
Growth usually puts pressure on an airline's profitability in the short run. It can take a couple of years for demand to fully ramp up as customers discover the new flights and change their travel patterns.
However, thanks to the massive drop in fuel prices -- and to a lesser extent, improved efficiency -- Southwest reported a stellar 17.4% operating margin last quarter. This was up by more than 10 percentage points year over year despite Southwest increasing its capacity by 6.0%.
A great time to grow
Southwest's stellar Q1 results show the wisdom of targeted growth in the current domestic airline market. Costs are falling because of the sharp drop in oil prices since last summer, while domestic travel demand remains robust.
Southwest hopes to hold unit revenue flat this year. Even if it falls short of this ambitious target, it will still be better off than if it had adopted a modest growth rate. After all, it is earning a very high 25.6% return on invested capital. When a company is earning a very strong return on invested capital like that, investing in growth is clearly in shareholders' best interests.
There are still plenty of doubters
Not all Wall Street analysts see it that way, though. Southwest Airlines CEO Gary Kelly still had to fend off a couple of questions during the earnings call about why the company was growing so quickly.
What really seems to be happening is that American Airlines and its legacy peers have reduced their capacity plans recently in order to bolster their unit revenue, and some analysts were hoping Southwest would follow suit.
Southwest isn't facing the same pressures as the legacy carriers, though. For example, passenger unit revenue declined 1.7% last quarter at American Airlines, whereas it was flat at Southwest. For Q2, American expects its passenger unit revenue to decline 4%-6%, while Southwest expects a more modest decline of perhaps 2%.
American Airlines has been fairly up-front about the fact that Southwest's rapid growth in Dallas (and elsewhere, to a lesser extent) is one of the factors depressing its unit revenue right now. But from Southwest's perspective, this is very profitable growth. As long as it is earning a better than 20% return on invested capital, Southwest should keep pushing the pace on expansion -- regardless of the impact on its competitors.
This $19 trillion industry could destroy the Internet
One bleeding-edge technology is about to put the World Wide Web to bed. And if you act right away, it could make you wildly rich. Experts are calling it the single largest business opportunity in the history of capitalism... The Economist is calling it "transformative"... but you'll probably just call it "how I made my millions." Don't be too late to the party -- click here for one stock to own when the Web goes dark.
Adam Levine-Weinberg has no position in any stocks mentioned.
The Southwest Corridor light rail project is now expected to cost $2 billion — $341 million more than the prior estimate, the Metropolitan Council said Monday.
Most of the additional cost was attributed to ground conditions along the route and soil contamination in St. Louis Park and Hopkins.
"The additional costs for the Southwest LRT Project pose significant challenges for our funding partners and taxpayers," Met Council Chair Adam Duininck said in a statement on the new cost estimate. "I will be talking to our funding partners, local communities and legislative leaders to determine the future of this project — all options are on the table."
The Met Council said that additional testing and engineering work filled in planning for the project, from a 1 percent level of detail to a 30 percent level of detail. Those new details include:
• 80 percent increase in retaining walls identified, as well as bridges and connecting roads.
• Redesign to accommodate poor ground conditions along the length of the corridor.
• Redesign to accommodate wetlands, flood plains and drainage areas, primarily in Eden Prairie.
• Acquire 137 acres of property, up by 11 acres from 126.
• Redesign to address rail safety requirements, including five gated LRT crossings and five shared freight rail and LRT crossings.
Gov. Mark Dayton said he was "shocked and appalled" to learn of the big jump in the line's expected cost.
"The continuing escalation of the costs to design and build this line raise serious questions about its viability and affordability," Dayton said in a statement, adding the Met Council board "should quickly review other options for providing much-needed public transit to this region of the metro area."
Duininck said he has asked planners to look for cost savings on the project to reduce the increase.
Trains are now expected to start rolling on the Minneapolis-to-Eden Prairie line by 2020 instead of 2019.
The ballooning costs are the latest in a series of obstacles for the project, which had an estimated price tag of $1.25 billion just two years ago. Since then, it has faced a series of delays due to opposition from Minneapolis residents concerned it would harm nearby lakes and a popular recreation trail.
The city and the Metropolitan Council eventually agreed to bury the trains in a $130 million dollar tunnel as they pass between Cedar Lake and Lake of the Isles. The Met Council struck a separate deal with the Minneapolis Park Board, which was concerned that the trains would detract from the scenic channel of waters between two lakes.
In addition to the problems raised by the latest cost estimates, the project also faces two lawsuits — one from a group of Minneapolis residents, and another from the owner of a Minnetonka apartment complex.
The new details and cost estimates are scheduled to be included in a Supplemental Draft Environmental Impact Statement, originally scheduled for January of 2014, now expected in May.
The Met Council has already spent $59 million on project planning.
Light rail is still the best option to meet transit needs in the southwest metro, but the project's expenses need to be reduced, Hennepin County Commissioner Peter McLaughlin said.
McLaughlin supports the southwest light rail project but acknowledged the jump in expected cost is a "huge setback. We're going to have to find ways to make the thing work."
Published: April 28, 2015 2:36 pm
Southwest Airlines canceled nine early-morning Baltimore flights Tuesday — five departures and four arrivals – in reaction to the civil unrest that hit the city Monday evening, the carrier said.
“This allowed us to ensure adequate staffing and gave Southwest employees (and customers) the opportunity to make arrangements for school being cancelled, and potentially, that transit could be closed,” a Southwest spokeswoman said Tuesday afternoon.
“Operations and staffing are business-as-usual now, and we do not anticipate additional cancellations,” she said.
Southwest operates between 215 and 220 weekday departures at Baltimore-Washington International Thurgood Marshall Airport.
Rioting and looting broke out Monday in Baltimore after the funeral of a black man who suffered injuries while in police custody and subsequently died. The Maryland governor has called out the Maryland National Guard, and a curfew is in effect. Public schools, other institutions and some businesses were closed Tuesday.
HOUSTON (KTRK) --
Police are investigating a murder at southwest Houston hotel.The crime scene is located at the Sun Suites Inn in the 3100 block of West Sam Houston Parkway South.
Witnesses tell Eyewitness News they heard an argument followed by four gunshots.
Detectives are still trying to piece together details of the shooting.
Keep checking back on this page to get real-time updates as this story unfolds. To get alerts for breaking news, download the ABC-13 news app for iPhone or Android. You can also get breaking news alerts sent to you by email.
(Copyright ©2015 KTRK-TV/DT. All Rights Reserved.)
Chairman and CEO Gary Kelly listens to a question during the opening last year of Southwest Airlines’ system operations center in Dallas. (Terry Maxon/DMN)
Naysayers may point out that Southwest Airlines chairman, president and CEO Gary Kelly was paid more than $5 million in cash, stock and other compensiation in 2014.
Related
Fortune Magazine offers the counterpoint: His pay is modest compared to heads of other companies.
As a result, Fortune put him at the top of five CEOs that it calls the most underrated.
“Kelly’s pay is still relatively modest,” Fortune said. “His base salary is well below his peers, at his request. And the company has the chutzpah to award a discretionary cash bonus, recognizing, as many companies do, that sometimes things come along that aren’t recognized by ‘official’ objective bonus plans. The discretionary bonus is not large, a few hundred thousand dollars. This all adds up to restrained pay for exceptional performance.”
The magazine noted that he got a 25 percent pay raise in 2014, while total stockholder return was 126 percent, net income grew 51 percent and the return on capital was 16 percent,.
“Since Gary Kelly was appointed as CEO, Southwest has outperformed every one of its rivals: Jet Blue, United Continental, American Airlines, Virgin America, Delta,” Fortune said.
Although Fortune doesn’t mention it, Kelly is having to deal with the unhappiness of labor groups that have been negotiating new contracts for years. But it noted that Southwest employees will divide up $355 milllion in profit sharing based on 2014 profits.
“That’s the equivalent of five weeks’ pay for the average employee and represents the largest total dollar amount Southwest has ever allocated to the plan,” the magazine said.
As it so happens, CEO #2 on Fortune’s list is Brad Tilden, Alaska Air Group’s president and CEO.
“Who is responsible for Alaska Air’s good fortune? Bradley Tilden, who has been piloting the company as CEO for almost three years. The stellar performance at Alaska Air has led to a pay bump for Tilden of only 18%, from $2.9 million to $3.5 million in 2014, according to figures provided by Equilar.,” Fortune said.
“Tilden’s base salary is set below the 25th percentile for the industry; in other words, three-quarters of his peers are paid more than he is. Most companies target their CEO’s pay in the 50th percentile or higher,” it noted.
The Southwest light-rail line, already the state’s largest transportation project, may be in peril now that its price tag has ballooned to close to $2 billion.
The escalating costs for the controversial 16-mile line from Minneapolis to Eden Prairie provoked a “shocked and appalled” Gov. Mark Dayton to express “serious questions about its viability and affordability.” Metropolitan Council Chair Adam Duininck did not rule out the possibility that the project could be scuttled.
“When I say all options are on the table, I really mean that,” said Duininck, who won Senate confirmation Monday to run the regional planning agency. “We need to take a pause to see how to proceed because this project is on uncertain ground right now.”
An analysis released Monday by the Metropolitan Council indicated that the transit project, which has been dogged by disputes over its route out of Minneapolis, would cost an additional $341 million. Opening day would be delayed a year, to sometime in 2020.The escalating costs are driven by poor ground conditions along its pathway from downtown Minneapolis to Eden Prairie, as well as soil contamination in St. Louis Park and Hopkins.
The fate of metro area transit projects is already uncertain at the State Capitol. A bill passed by the Republican-controlled House last week caps spending on Twin Cities transit projects, while a Senate bill calls for an increase in the metro-area sales tax for transit, as did Dayton’s initial transportation package.
On Monday, Senate Majority Leader Tom Bakk, DFL-Cook, described the turn of events as “very problematic. I’m interested in exploring the option of additional bus routes, doing a little cost comparison. Is that more feasible?”
Dayton and Duininck also questioned whether the southwestern suburbs could be better served by other modes of transit.
House Transportation Committee Chair Tim Kelly, R-Red Wing, said the news means “maybe we need to go back and try to get buy-in from the whole community before we go any further.”
$59 million spent so far
To date, $59 million has been spent on the project, according to Metro Transit. Of that amount, a local government group, the Counties Transit Improvement Board (CTIB), has spent $37 million, raised through a five-county metro sales tax. Another $11 million came from the state and the Hennepin County Regional Railroad Authority.
Dayton also said he will hold off recommending additional public money for the project “until I am satisfied that its cost can be justified and properly managed.”
Duininck, a Dayton appointee, said he will spend the coming weeks meeting with “funding partners, local communities and legislative leaders to determine the future of this project.”
In addition, Duininck said he has ordered the council’s engineers and contractors “to pursue every possible efficiency to achieve cost savings.” He conceded that if substantial changes to the project are needed, it would likely push out the timeline even further. And that could require cities and counties along the line to consent once again to the project, a time-consuming and unpredictable process.
“This could be an opportunity to determine whether this is the right corridor, the right service, and whether the region has a commitment to transit,” he said at a news conference. “It’s a time for reflection.”
Peter McLaughlin, a Hennepin County commissioner who leads the CTIB, said “$2 billion dollars is a big number, no question about it. We need to go back to our experience with the Hiawatha and Central Corridor lines and find ways to tighten down on the budget. It’s time for the sharpest of pencils now.”
Opponents feel ‘vindicated’
Not everyone was discouraged by the news, however.
A spokeswoman for the Lakes and Parks Alliance, which filed suit in U.S. District Court last fall to block the line, said the group feels “vindicated” by the development.
Chairman and CEO Gary Kelly listens to a question during the opening last year of Southwest Airlines’ system operations center in Dallas. (Terry Maxon/DMN)
Naysayers may point out that Southwest Airlines chairman, president and CEO Gary Kelly was paid more than $5 million in cash, stock and other compensiation in 2014.
Related
Fortune Magazine offers the counterpoint: His pay is modest compared to heads of other companies.
As a result, Fortune put him at the top of five CEOs that it calls the most underrated.
“Kelly’s pay is still relatively modest,” Fortune said. “His base salary is well below his peers, at his request. And the company has the chutzpah to award a discretionary cash bonus, recognizing, as many companies do, that sometimes things come along that aren’t recognized by ‘official’ objective bonus plans. The discretionary bonus is not large, a few hundred thousand dollars. This all adds up to restrained pay for exceptional performance.”
The magazine noted that he got a 25 percent pay raise in 2014, while total stockholder return was 126 percent, net income grew 51 percent and the return on capital was 16 percent,.
“Since Gary Kelly was appointed as CEO, Southwest has outperformed every one of its rivals: Jet Blue, United Continental, American Airlines, Virgin America, Delta,” Fortune said.
Although Fortune doesn’t mention it, Kelly is having to deal with the unhappiness of labor groups that have been negotiating new contracts for years. But it noted that Southwest employees will divide up $355 milllion in profit sharing based on 2014 profits.
“That’s the equivalent of five weeks’ pay for the average employee and represents the largest total dollar amount Southwest has ever allocated to the plan,” the magazine said.
As it so happens, CEO #2 on Fortune’s list is Brad Tilden, Alaska Air Group’s president and CEO.
“Who is responsible for Alaska Air’s good fortune? Bradley Tilden, who has been piloting the company as CEO for almost three years. The stellar performance at Alaska Air has led to a pay bump for Tilden of only 18%, from $2.9 million to $3.5 million in 2014, according to figures provided by Equilar.,” Fortune said.
“Tilden’s base salary is set below the 25th percentile for the industry; in other words, three-quarters of his peers are paid more than he is. Most companies target their CEO’s pay in the 50th percentile or higher,” it noted.
It's a great time to be an airline these days, thanks to lower jet fuel costs and strong demand. It also helped that carriers did not witness any severe weather conditions that have often plagued first quarter results. Southwest Airlines (NYSE:LUV), one of the biggest U.S. airlines, was the latest to report its quarterly results that came in ahead of market's estimates.
The 44 year old Dallas-based Southwest pioneered the low-cost-carrier model which is followed by dozens of airlines all over the world, including ultra-low-cost-carriers like Ryanair (NASDAQ:RYAAY) and Spirit Airlines (NASDAQ:SAVE) who took Southwest's idea to create a new niche. For the three months ending March, Southwest reported 6.2% year-over-year increase in passenger revenues to $4.18 billion while operating expenses dropped by 8% to $3.6 billion due in large part to the 33% drop in fuel spending to $877 million. Consequently, the company's operating income jumped by 263% to a first quarter record $780 million while net income also increased to a record of $453 million. In adjusted terms, this translated into a profit of $0.66 per share, up from $0.18 per share a year earlier. Analysts, on the other hand, were expecting earnings of $0.65 per share, as per data from FactSet.
Moreover, the record first-quarter load factor of 80.1%, which increased by 0.8 percentage points from last year, shows that Southwest is enjoying robust demand. The significant drop in oil prices, however, played a major role in lifting the company's profits to their highest levels ever. The economic fuel costs were $2 per gallon, down from $3.08 a year earlier. This translated into economic fuel cost savings of $450 million - that's about 80% of the increase in operating profits.
The lower fuel costs did the heavy lifting for the triple-digit earnings growth, but let's not take anything away from Southwest - it has done a remarkable job of keeping a lid on costs. During the quarter, the company's unit revenues were flat from last year while its core unit costs, which excludes fuel costs, special items and profit sharing expenses, declined by 3.6%. This means that if the fuel prices hadn't changed, then the company's earnings would still have gone up by 80%.
Besides, Southwest has taken a number of strategic initiatives that are playing an important role in driving its growth, which is a testament to this well run company. This includes the integration with AirTran which made Southwest the leading domestic airline, in terms of number of passenger flown, and put the company in a better position to compete against Delta Airlines (NYSE:DAL), United Continental (NYSE:UAL) and American Airlines (NASDAQ:AAL). Southwest has also ramped up competition against American by flying routes from Dallas Love Field, which is the reason behind the latter's decision to slash fares. Besides, Southwest has also increased capacity at Washington Reagan and New York LaGuardia. The company is also eying international expansion, particularly after AirTran's acquisition, as a key driver for future growth over the long-term.
In addition to being a well-run airline, what I particularly like about Southwest is that it is a shareholder friendly company. Southwest is a free cash flow generation machine and uses these resources to reward shareholders through dividends and buybacks. In the last two fiscal years, the company generated more than $2 billion in free cash flows, and returned 78% of those to shareholders through dividends and share repurchases. In the last quarter, with support from lower crude prices, Southwest generated $879 million in free cash flows -- that's a first quarter record and greater than $712 million for the full fiscal year 2012. With this kind of momentum, it is safe to assume that Southwest will report its highest-ever free cash flows in the current fiscal year and return more than 50% of this to shareholders, as per its promise. In a report emailed to me, Credit Suisse's analyst Julie Yates, forecast that Southwest will report $2.23 billion in free cash flows in 2015, of which 95% will be returned to shareholders, just as it did in 2014.
Although it is true the Southwest's growth is being driven in large part by the weakness in crude prices, it is still a very well run and a shareholder friendly company. This is evident in its various strategic decisions that have fueled Southwest's growth over the last few years and its promise to return a majority of the annual free cash flow to shareholders. In this context, the company's May 13 board meeting in which Southwest will provide an update on dividend and possibly announce a new buyback program could act as a catalyst for upside. The company's current $1 billion buyback authorization will conclude next month.
Southwest was the top performing S&P-500 stock in 2014. Over the last six months, the company's shares have climbed 28.4%, easily outperforming S&P-500 which climbed 7.7% in the same period. I am bullish on this stock and expect the shares to continue to outperform as the company moves forward with strong earnings and cash flow growth.
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The Southwest light-rail line, already the state’s largest transportation project, may be in peril now that its price tag has ballooned to close to $2 billion.
The escalating costs for the controversial 16-mile line from Minneapolis to Eden Prairie provoked a “shocked and appalled” Gov. Mark Dayton to express “serious questions about its viability and affordability.” Metropolitan Council Chair Adam Duininck did not rule out the possibility that the project could be scuttled.
“When I say all options are on the table, I really mean that,” said Duininck, who won Senate confirmation Monday to run the regional planning agency. “We need to take a pause to see how to proceed because this project is on uncertain ground right now.”
An analysis released Monday by the Metropolitan Council indicated that the transit project, which has been dogged by disputes over its route out of Minneapolis, would cost an additional $341 million. Opening day would be delayed a year, to sometime in 2020.The escalating costs are driven by poor ground conditions along its pathway from downtown Minneapolis to Eden Prairie, as well as soil contamination in St. Louis Park and Hopkins.
The fate of metro area transit projects is already uncertain at the State Capitol. A bill passed by the Republican-controlled House last week caps spending on Twin Cities transit projects, while a Senate bill calls for an increase in the metro-area sales tax for transit, as did Dayton’s initial transportation package.
On Monday, Senate Majority Leader Tom Bakk, DFL-Cook, described the turn of events as “very problematic. I’m interested in exploring the option of additional bus routes, doing a little cost comparison. Is that more feasible?”
Dayton and Duininck also questioned whether the southwestern suburbs could be better served by other modes of transit.
House Transportation Committee Chair Tim Kelly, R-Red Wing, said the news means “maybe we need to go back and try to get buy-in from the whole community before we go any further.”
$59 million spent so far
To date, $59 million has been spent on the project, according to Metro Transit. Of that amount, a local government group, the Counties Transit Improvement Board (CTIB), has spent $37 million, raised through a five-county metro sales tax. Another $11 million came from the state and the Hennepin County Regional Railroad Authority.
Dayton also said he will hold off recommending additional public money for the project “until I am satisfied that its cost can be justified and properly managed.”
Duininck, a Dayton appointee, said he will spend the coming weeks meeting with “funding partners, local communities and legislative leaders to determine the future of this project.”
In addition, Duininck said he has ordered the council’s engineers and contractors “to pursue every possible efficiency to achieve cost savings.” He conceded that if substantial changes to the project are needed, it would likely push out the timeline even further. And that could require cities and counties along the line to consent once again to the project, a time-consuming and unpredictable process.
“This could be an opportunity to determine whether this is the right corridor, the right service, and whether the region has a commitment to transit,” he said at a news conference. “It’s a time for reflection.”
Peter McLaughlin, a Hennepin County commissioner who leads the CTIB, said “$2 billion dollars is a big number, no question about it. We need to go back to our experience with the Hiawatha and Central Corridor lines and find ways to tighten down on the budget. It’s time for the sharpest of pencils now.”
Opponents feel ‘vindicated’
Not everyone was discouraged by the news, however.
A spokeswoman for the Lakes and Parks Alliance, which filed suit in U.S. District Court last fall to block the line, said the group feels “vindicated” by the development.
The task ahead for Southwest to accomplish may be reminiscent of Sisyphus, but the Dragons have a chance to win District 28-6A.
In Greek mythology, Sisyphus was sentenced to push a boulder up a steep hill, only to have it roll back down. Southwest’s equivalent would involve winning four games in the final week of the season, two of which were rescheduled from April 22 and April 24.
Pitching depth is possibly the greatest strength for the Dragons (10-9, 3-3) and it will be put to the test with games scheduled at home April 27 against South San (3-15, 0-6) and April 28 against Corpus Christi Ray (11-5, 5-1) and road games Thursday, April 30, against Corpus Christi King (13-6, 5-1) and Friday, May 1, versus Corpus Christi Carroll (13-3-1, 4-3).
“We have more quality pitching depth than we’ve had in the past,” Southwest coach John Velasquez said. “The question is whether they can take the grind, physically and mentally. If we win all four, we have a chance to be district champion.”
In Southwest’s only game of the previous seven days, the Dragons defeated East Central (11-8, 2-5) 3-1 April 21. The Hornets also lost 7-3 to Carroll on April 23 in Corpus Christi.
East Central will finish its regular season with games at home against Ray on April 27, versus King on April 28 in Corpus Christi and Friday, May 1 at home against South San.
“Without a doubt, those three games will be tough,” East Central Coach Joe Gutierrez said, “but if we had to play four, that would be even more difficult. This is going to come down to the last day.”
East Central and Southwest may be fighting for the final postseason spot in 28-6A. Entering the final week, the area playoff qualifiers were Burbank (13-7, 11-3), Central Catholic (9-11-1, 3-2), Harlandale (14-5-1, 12-2), Holy Cross (15-7, 9-2), Highlands (11-7-1, 9-5) and McCollum (14-5, 14-0).
Southwest senior Joseph Cerda, who signed to play next year at Oklahoma Panhandle State University, pitched a five-hitter against East Central.
“It’s a really good win,” Cerda said. “We’re hoping we get on a roll. If we can win out, we’ll put pressure on everyone.”
Cerda, Zachary Ponce (squeeze bunt) and Juan Carlos Hernandez (triple) drove in runs for Southwest. East Central pulled within 2-1 in the fifth on Kyle Wildman’s single.
Holy Cross 8, Cornerstone Christian 4
The Knights (16-7, 10-2) not only secured Holy Cross coach Polo Botello’s 250th career win over 22 years, but took over first place with a TAPPS District 4-4A victory over Cornerstone Christian (13-5, 10-2) April 23 at Wolff Stadium.
“They’ve gone through a lot of growing pains,” Botello said. “They’ve played close to 100 games together.”
Although it reportedly struck a truck on the tarmac Sunday afternoon, a Southwest jet aircraft was able to take off for Atlanta as planned.
According to Southwest officials, Flight 1717 was backing up along the Orlando International Airport tarmac when the right wing of the aircraft hit a provisioning truck.
The plane was scheduled to take off at 5:20 p.m., as stated on the flight tracking site FlightAware.
Though no one reported an injury from the incident, the "very light contact" caused about an hour delay to Atlanta for the 143 passengers and five crew members aboard, said Southwest spokesperson Chris Mainz.
Flight 1717 was unable to take off until 6:50 p.m., according to FlightAware, which put the plane's arrival at Hartsfield-Jackson International at 8:02 p.m. instead of 6:32 p.m.
"Our maintenance crew did a thorough inspection of the impact areas and found no damage," Mainz stated in an email.
According to Mainz, neither the aircraft or truck sustained damage.
Jinman@OrllandoSentinel.com or 407-420-5002
Copyright © 2015, Orlando SentinelThe Southwest light-rail line, already the state’s largest transportation project, may be in peril now that its price tag has ballooned to close to $2 billion.
The escalating costs for the controversial 16-mile line from Minneapolis to Eden Prairie provoked a “shocked and appalled” Gov. Mark Dayton to express “serious questions about its viability and affordability.” Metropolitan Council Chair Adam Duininck did not rule out the possibility that the project could be scuttled.
“When I say all options are on the table, I really mean that,” said Duininck, who won Senate confirmation Monday to run the regional planning agency. “We need to take a pause to see how to proceed because this project is on uncertain ground right now.”
An analysis released Monday by the Metropolitan Council indicated that the transit project, which has been dogged by disputes over its route out of Minneapolis, would cost an additional $341 million. Opening day would be delayed a year, to sometime in 2020.The escalating costs are driven by poor ground conditions along its pathway from downtown Minneapolis to Eden Prairie, as well as soil contamination in St. Louis Park and Hopkins.
The fate of metro area transit projects is already uncertain at the State Capitol. A bill passed by the Republican-controlled House last week caps spending on Twin Cities transit projects, while a Senate bill calls for an increase in the metro-area sales tax for transit, as did Dayton’s initial transportation package.
On Monday, Senate Majority Leader Tom Bakk, DFL-Cook, described the turn of events as “very problematic. I’m interested in exploring the option of additional bus routes, doing a little cost comparison. Is that more feasible?”
Dayton and Duininck also questioned whether the southwestern suburbs could be better served by other modes of transit.
House Transportation Committee Chair Tim Kelly, R-Red Wing, said the news means “maybe we need to go back and try to get buy-in from the whole community before we go any further.”
$59 million spent so far
To date, $59 million has been spent on the project, according to Metro Transit. Of that amount, a local government group, the Counties Transit Improvement Board (CTIB), has spent $37 million, raised through a five-county metro sales tax. Another $11 million came from the state and the Hennepin County Regional Railroad Authority.
Dayton also said he will hold off recommending additional public money for the project “until I am satisfied that its cost can be justified and properly managed.”
Duininck, a Dayton appointee, said he will spend the coming weeks meeting with “funding partners, local communities and legislative leaders to determine the future of this project.”
In addition, Duininck said he has ordered the council’s engineers and contractors “to pursue every possible efficiency to achieve cost savings.” He conceded that if substantial changes to the project are needed, it would likely push out the timeline even further. And that could require cities and counties along the line to consent once again to the project, a time-consuming and unpredictable process.
“This could be an opportunity to determine whether this is the right corridor, the right service, and whether the region has a commitment to transit,” he said at a news conference. “It’s a time for reflection.”
Peter McLaughlin, a Hennepin County commissioner who leads the CTIB, said “$2 billion dollars is a big number, no question about it. We need to go back to our experience with the Hiawatha and Central Corridor lines and find ways to tighten down on the budget. It’s time for the sharpest of pencils now.”
Opponents feel ‘vindicated’
Not everyone was discouraged by the news, however.
A spokeswoman for the Lakes and Parks Alliance, which filed suit in U.S. District Court last fall to block the line, said the group feels “vindicated” by the development.
Chairman and CEO Gary Kelly listens to a question during the opening last year of Southwest Airlines’ system operations center in Dallas. (Terry Maxon/DMN)
Naysayers may point out that Southwest Airlines chairman, president and CEO Gary Kelly was paid more than $5 million in cash, stock and other compensiation in 2014.
Related
Fortune Magazine offers the counterpoint: His pay is modest compared to heads of other companies.
As a result, Fortune put him at the top of five CEOs that it calls the most underrated.
“Kelly’s pay is still relatively modest,” Fortune said. “His base salary is well below his peers, at his request. And the company has the chutzpah to award a discretionary cash bonus, recognizing, as many companies do, that sometimes things come along that aren’t recognized by ‘official’ objective bonus plans. The discretionary bonus is not large, a few hundred thousand dollars. This all adds up to restrained pay for exceptional performance.”
The magazine noted that he got a 25 percent pay raise in 2014, while total stockholder return was 126 percent, net income grew 51 percent and the return on capital was 16 percent,.
“Since Gary Kelly was appointed as CEO, Southwest has outperformed every one of its rivals: Jet Blue, United Continental, American Airlines, Virgin America, Delta,” Fortune said.
Although Fortune doesn’t mention it, Kelly is having to deal with the unhappiness of labor groups that have been negotiating new contracts for years. But it noted that Southwest employees will divide up $355 milllion in profit sharing based on 2014 profits.
“That’s the equivalent of five weeks’ pay for the average employee and represents the largest total dollar amount Southwest has ever allocated to the plan,” the magazine said.
As it so happens, CEO #2 on Fortune’s list is Brad Tilden, Alaska Air Group’s president and CEO.
“Who is responsible for Alaska Air’s good fortune? Bradley Tilden, who has been piloting the company as CEO for almost three years. The stellar performance at Alaska Air has led to a pay bump for Tilden of only 18%, from $2.9 million to $3.5 million in 2014, according to figures provided by Equilar.,” Fortune said.
“Tilden’s base salary is set below the 25th percentile for the industry; in other words, three-quarters of his peers are paid more than he is. Most companies target their CEO’s pay in the 50th percentile or higher,” it noted.
It's a great time to be an airline these days, thanks to lower jet fuel costs and strong demand. It also helped that carriers did not witness any severe weather conditions that have often plagued first quarter results. Southwest Airlines (NYSE:LUV), one of the biggest U.S. airlines, was the latest to report its quarterly results that came in ahead of market's estimates.
The 44 year old Dallas-based Southwest pioneered the low-cost-carrier model which is followed by dozens of airlines all over the world, including ultra-low-cost-carriers like Ryanair (NASDAQ:RYAAY) and Spirit Airlines (NASDAQ:SAVE) who took Southwest's idea to create a new niche. For the three months ending March, Southwest reported 6.2% year-over-year increase in passenger revenues to $4.18 billion while operating expenses dropped by 8% to $3.6 billion due in large part to the 33% drop in fuel spending to $877 million. Consequently, the company's operating income jumped by 263% to a first quarter record $780 million while net income also increased to a record of $453 million. In adjusted terms, this translated into a profit of $0.66 per share, up from $0.18 per share a year earlier. Analysts, on the other hand, were expecting earnings of $0.65 per share, as per data from FactSet.
Moreover, the record first-quarter load factor of 80.1%, which increased by 0.8 percentage points from last year, shows that Southwest is enjoying robust demand. The significant drop in oil prices, however, played a major role in lifting the company's profits to their highest levels ever. The economic fuel costs were $2 per gallon, down from $3.08 a year earlier. This translated into economic fuel cost savings of $450 million - that's about 80% of the increase in operating profits.
The lower fuel costs did the heavy lifting for the triple-digit earnings growth, but let's not take anything away from Southwest - it has done a remarkable job of keeping a lid on costs. During the quarter, the company's unit revenues were flat from last year while its core unit costs, which excludes fuel costs, special items and profit sharing expenses, declined by 3.6%. This means that if the fuel prices hadn't changed, then the company's earnings would still have gone up by 80%.
Besides, Southwest has taken a number of strategic initiatives that are playing an important role in driving its growth, which is a testament to this well run company. This includes the integration with AirTran which made Southwest the leading domestic airline, in terms of number of passenger flown, and put the company in a better position to compete against Delta Airlines (NYSE:DAL), United Continental (NYSE:UAL) and American Airlines (NASDAQ:AAL). Southwest has also ramped up competition against American by flying routes from Dallas Love Field, which is the reason behind the latter's decision to slash fares. Besides, Southwest has also increased capacity at Washington Reagan and New York LaGuardia. The company is also eying international expansion, particularly after AirTran's acquisition, as a key driver for future growth over the long-term.
In addition to being a well-run airline, what I particularly like about Southwest is that it is a shareholder friendly company. Southwest is a free cash flow generation machine and uses these resources to reward shareholders through dividends and buybacks. In the last two fiscal years, the company generated more than $2 billion in free cash flows, and returned 78% of those to shareholders through dividends and share repurchases. In the last quarter, with support from lower crude prices, Southwest generated $879 million in free cash flows -- that's a first quarter record and greater than $712 million for the full fiscal year 2012. With this kind of momentum, it is safe to assume that Southwest will report its highest-ever free cash flows in the current fiscal year and return more than 50% of this to shareholders, as per its promise. In a report emailed to me, Credit Suisse's analyst Julie Yates, forecast that Southwest will report $2.23 billion in free cash flows in 2015, of which 95% will be returned to shareholders, just as it did in 2014.
Although it is true the Southwest's growth is being driven in large part by the weakness in crude prices, it is still a very well run and a shareholder friendly company. This is evident in its various strategic decisions that have fueled Southwest's growth over the last few years and its promise to return a majority of the annual free cash flow to shareholders. In this context, the company's May 13 board meeting in which Southwest will provide an update on dividend and possibly announce a new buyback program could act as a catalyst for upside. The company's current $1 billion buyback authorization will conclude next month.
Southwest was the top performing S&P-500 stock in 2014. Over the last six months, the company's shares have climbed 28.4%, easily outperforming S&P-500 which climbed 7.7% in the same period. I am bullish on this stock and expect the shares to continue to outperform as the company moves forward with strong earnings and cash flow growth.
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The task ahead for Southwest to accomplish may be reminiscent of Sisyphus, but the Dragons have a chance to win District 28-6A.
In Greek mythology, Sisyphus was sentenced to push a boulder up a steep hill, only to have it roll back down. Southwest’s equivalent would involve winning four games in the final week of the season, two of which were rescheduled from April 22 and April 24.
Pitching depth is possibly the greatest strength for the Dragons (10-9, 3-3) and it will be put to the test with games scheduled at home April 27 against South San (3-15, 0-6) and April 28 against Corpus Christi Ray (11-5, 5-1) and road games Thursday, April 30, against Corpus Christi King (13-6, 5-1) and Friday, May 1, versus Corpus Christi Carroll (13-3-1, 4-3).
“We have more quality pitching depth than we’ve had in the past,” Southwest coach John Velasquez said. “The question is whether they can take the grind, physically and mentally. If we win all four, we have a chance to be district champion.”
In Southwest’s only game of the previous seven days, the Dragons defeated East Central (11-8, 2-5) 3-1 April 21. The Hornets also lost 7-3 to Carroll on April 23 in Corpus Christi.
East Central will finish its regular season with games at home against Ray on April 27, versus King on April 28 in Corpus Christi and Friday, May 1 at home against South San.
“Without a doubt, those three games will be tough,” East Central Coach Joe Gutierrez said, “but if we had to play four, that would be even more difficult. This is going to come down to the last day.”
East Central and Southwest may be fighting for the final postseason spot in 28-6A. Entering the final week, the area playoff qualifiers were Burbank (13-7, 11-3), Central Catholic (9-11-1, 3-2), Harlandale (14-5-1, 12-2), Holy Cross (15-7, 9-2), Highlands (11-7-1, 9-5) and McCollum (14-5, 14-0).
Southwest senior Joseph Cerda, who signed to play next year at Oklahoma Panhandle State University, pitched a five-hitter against East Central.
“It’s a really good win,” Cerda said. “We’re hoping we get on a roll. If we can win out, we’ll put pressure on everyone.”
Cerda, Zachary Ponce (squeeze bunt) and Juan Carlos Hernandez (triple) drove in runs for Southwest. East Central pulled within 2-1 in the fifth on Kyle Wildman’s single.
Holy Cross 8, Cornerstone Christian 4
The Knights (16-7, 10-2) not only secured Holy Cross coach Polo Botello’s 250th career win over 22 years, but took over first place with a TAPPS District 4-4A victory over Cornerstone Christian (13-5, 10-2) April 23 at Wolff Stadium.
“They’ve gone through a lot of growing pains,” Botello said. “They’ve played close to 100 games together.”
The Southwest light-rail line, already the state’s largest transportation project, may be in peril now that its price tag has ballooned to close to $2 billion.
The escalating costs for the controversial 16-mile line from Minneapolis to Eden Prairie provoked a “shocked and appalled” Gov. Mark Dayton to express “serious questions about its viability and affordability.” Metropolitan Council Chair Adam Duininck did not rule out the possibility that the project could be scuttled.
“When I say all options are on the table, I really mean that,” said Duininck, who won Senate confirmation Monday to run the regional planning agency. “We need to take a pause to see how to proceed because this project is on uncertain ground right now.”
An analysis released Monday by the Metropolitan Council indicated that the transit project, which has been dogged by disputes over its route out of Minneapolis, would cost an additional $341 million. Opening day would be delayed a year, to sometime in 2020.The escalating costs are driven by poor ground conditions along its pathway from downtown Minneapolis to Eden Prairie, as well as soil contamination in St. Louis Park and Hopkins.
The fate of metro area transit projects is already uncertain at the State Capitol. A bill passed by the Republican-controlled House last week caps spending on Twin Cities transit projects, while a Senate bill calls for an increase in the metro-area sales tax for transit, as did Dayton’s initial transportation package.
On Monday, Senate Majority Leader Tom Bakk, DFL-Cook, described the turn of events as “very problematic. I’m interested in exploring the option of additional bus routes, doing a little cost comparison. Is that more feasible?”
Dayton and Duininck also questioned whether the southwestern suburbs could be better served by other modes of transit.
House Transportation Committee Chair Tim Kelly, R-Red Wing, said the news means “maybe we need to go back and try to get buy-in from the whole community before we go any further.”
$59 million spent so far
To date, $59 million has been spent on the project, according to Metro Transit. Of that amount, a local government group, the Counties Transit Improvement Board (CTIB), has spent $37 million, raised through a five-county metro sales tax. Another $11 million came from the state and the Hennepin County Regional Railroad Authority.
Dayton also said he will hold off recommending additional public money for the project “until I am satisfied that its cost can be justified and properly managed.”
Duininck, a Dayton appointee, said he will spend the coming weeks meeting with “funding partners, local communities and legislative leaders to determine the future of this project.”
In addition, Duininck said he has ordered the council’s engineers and contractors “to pursue every possible efficiency to achieve cost savings.” He conceded that if substantial changes to the project are needed, it would likely push out the timeline even further. And that could require cities and counties along the line to consent once again to the project, a time-consuming and unpredictable process.
“This could be an opportunity to determine whether this is the right corridor, the right service, and whether the region has a commitment to transit,” he said at a news conference. “It’s a time for reflection.”
Peter McLaughlin, a Hennepin County commissioner who leads the CTIB, said “$2 billion dollars is a big number, no question about it. We need to go back to our experience with the Hiawatha and Central Corridor lines and find ways to tighten down on the budget. It’s time for the sharpest of pencils now.”
Opponents feel ‘vindicated’
Not everyone was discouraged by the news, however.
A spokeswoman for the Lakes and Parks Alliance, which filed suit in U.S. District Court last fall to block the line, said the group feels “vindicated” by the development.
Although it reportedly struck a truck on the tarmac Sunday afternoon, a Southwest jet aircraft was able to take off for Atlanta as planned.
According to Southwest officials, Flight 1717 was backing up along the Orlando International Airport tarmac when the right wing of the aircraft hit a provisioning truck.
The plane was scheduled to take off at 5:20 p.m., as stated on the flight tracking site FlightAware.
Though no one reported an injury from the incident, the "very light contact" caused about an hour delay to Atlanta for the 143 passengers and five crew members aboard, said Southwest spokesperson Chris Mainz.
Flight 1717 was unable to take off until 6:50 p.m., according to FlightAware, which put the plane's arrival at Hartsfield-Jackson International at 8:02 p.m. instead of 6:32 p.m.
"Our maintenance crew did a thorough inspection of the impact areas and found no damage," Mainz stated in an email.
According to Mainz, neither the aircraft or truck sustained damage.
Jinman@OrllandoSentinel.com or 407-420-5002
Copyright © 2015, Orlando SentinelA Southwest Airlines plane traveling from Las Vegas to Milwaukee was diverted to Denver Friday night because of "a pressurization issue," according to the Denver International Airport.
Upon landing at the new destination, some passengers of flight 100 requested medical attention and were met by ambulances, but only one passenger needed to be transported to the hospital due to a "slip and fall," according to a statement from the airport.
The flight with six crew and 175 passengers landed safely in Denver at 8:30 p.m. local time, according to a statement from Southwest. The airline said the aircraft would be taken out of service to be inspected, and passengers would be transported to Milwaukee on another plane, scheduled to arrive about two hours late.
First published April 24 2015, 11:17 PM
In this May 15, 2014 photo, a Southwest Airlines Boeing 737-700 takes off from Tampa International Airport in Tampa, Fla. Southwest Airlines reports quarterly financial results on Thursday, Oct. 23, 2014. (AP Photo/Chris O'Meara) ORG XMIT: NYBZ189(Photo: Chris O'Meara, AP)
The lower fuel prices buoying the airline industry helped low-cost giant Southwest (LUV) post record profits in the first quarter.
The airline saw a profit of $453 million, or 66 cents per share, counting special items, a new high for the quarter. That was up from the $152 million profit, or 22 cents per share the airline earned during the start of 2014.
Southwest shares are up 1.69% to $43.57 in mid-day trading.
.
Not counting special items, Southwest also posted a record profit of $451 million, or 66 cents per share. That was just $34 million short of being an all-time record for any quarter,Tammy Romo, Southwest's chief financial officer said during an earnings call on Thursday.
"It was a great first quarter,'' Gary Kelly, Southwest's president and CEO said during the call. "Lower fuel prices were a big part of the first quarter story.''
The airline's earnings beat the consensus of 64 cents per share, as noted by Zacks Investment Research.
Souhwest also saw a first quarter peak in operating income, with $780 million. Not counting special items, the airline also saw an operating income record for the first three months of a year, with $770 million.
S&P Capital IQ boosted its 2015 and 2016 earnings per share estimates for Southwest to $3.52 and $3.80 from $3.12 and $3.43. "We are positive on moves (Southwest) has made to accelerate revenue growth as well,'' analyst Jim Corridore said in an investors note.
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A three-vehicle accident on US-59 northbound/eastbound at the 610 Loop West caused gridlock in the area on Friday just as the afternoon rush hour began.
The accident happened just after 4:30 p.m. Friday on the Southwest Freeway just west of the Loop. Lanes reopened at 5:34, according to TranStar.
The wreck is affecting several lanes of both the eastbound freeway and northbound Loop in the area.
No details are available on what led to the accident.
A widow is suing Southwest airlines after he husband died in a plane bathroom.(Photo: LM Otero, AP)
Richard Ilczyszyn, a financial analyst and contributor to CNBC's "Futures Now", was on a Southwest flight last September when he fell ill, suffering what was later determined to be a fatal pulmonary embolism.
He collapsed in the plane's bathroom about 10 minutes before the flight was scheduled to land at John Wayne Airport in Orange County, California, and according to the Sheriff's report, the flight crew discovered him "slumped over," "groaning" and "crying."
When the flight landed, a crew member called the police, allegedly believing that Ilczyszyn was a disruptive passenger. In a phone call, a Southwest employee told the dispatcher:
"Apparently there's a passenger in – locked himself in the lav and is screaming and yelling."
All of the passengers were instructed to leave the plane before the officers boarded the aircraft, discovering an "unresponsive" Ilczyszyn in the bathroom. The paramedics were then called to the scene.
That delayed response to Ilczyszyn's condition – and the fact that Southwest crew members called the Sheriff instead of an ambulance – is why his widow, Kelly Ilczyszyn has filed a wrongful death suit against the airline. Ilczyszyn, who has worked as a Southwest flight attendant for 16 years, believes that her husband would have survived if he had received immediate medical attention. She told CBS News:
One flight attendant said she opened the door and she saw the top of my husband's head and his head was down and he was just whimpering, and [she] left him there […] Somebody that's head is down and there's no communication is somebody that's in distress, that needs help. That doesn't need a police officer. They need paramedics.
In a statement, representatives for Southwest said that the crew acted "appropriately and professionally" when handling the "unfortunate medical event." Road Warrior Voices reached out to Southwest for further comment, and will update this piece accordingly if the airline responds.
Sara Nelson, the International President of the Association of Flight Attendants-CWA, AFL-CIO, told CBS that flight crews are trained to treat any kind of disruption during a flight as a potential threat to security – or as a diversion to distract crews while a more dangerous incident takes place. She said:
It's possible that they could not determine that there was not a serious security risk to the flight.
Kelly Ilczyszyn believes otherwise. "They dropped the ball," she told the Los Angeles Times.
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