Victor Cook

Fixing the Airlines: Reconfigure or Reregulate

Waves,

I tracked down Southwest's gains from fuel hedging from 2004 through 2007 in a New York Times article: www.nytimes.com/2007/1.... The 2007 number was for the first 9 months, so I adjusted upward by (9/12).

Combined with the company's Before Tax net, here's how it worked out:

LUV Gains BT Net Difference
2007 $585 $1,058 $473
2006 $675 $790 $115
2005 $892 $779 -$113
2004 $455 $339 -$116
Sum $2,607 $2,966 $359

Over the four years $2.6b gain from fuel hedging compared wiht $3.0b before tax net gave them a $359m profit. But they lost money in 2004 and 2005 as you guessed.

According to the NYT article LUV is hedged through 2009.

~V