Friday, October 19, 2007

AIRLINES

Southwest profit rises on stronger demand

DALLAS — Southwest Airlines Co., the nation's biggest discount carrier, on Thursday said its third-quarter profit rose because the airline packed planes fuller amid strong demand.

Net income for the three months that ended Sept. 30 rose to $162 million, or 22 cents per share, compared with $48 million, or 6 cents per share, during the same period a year earlier.

Analysts polled by Thomson Financial had been expecting earnings, on average, of 21 cents per share.

The earnings figures include the effect of a $25 million charge to cover early retirement payments for about 7 percent of employees and an $11 million charge related to state taxes in Illinois.

Southwest said the charges, which amounted to about 3 cents per share in total, were not included in analysts' estimates.

Revenue increased to $2.59 billion, up from $2.34 billion during the third quarter last year. Analysts had predicted revenue of $2.58 billion.

British Airways seeking closer ties to American

LONDON — British Airways PLC said it wants to forge closer ties with American Airlines in the longer term but has no plans to seek regulatory approval for a tie-up.

BA and American Airlines, a unit of Fort Worth-based AMR Corp., are members of the Oneworld Alliance of carriers, which allows customers of one airline to earn and redeem frequent-flier miles on most flights operated by alliance partners.

The airlines have twice previously tried to cement a closer relationship through a profit-sharing arrangement covering trans-Atlantic routes. Those attempts failed as U.S. regulators wanted the carriers to cede too many landing slots, particularly at London's Heathrow Airport.

Tony Cane, a BA spokesman, said Thursday that the British carrier would like "a closer relationship" with American but that it won't seek antitrust immunity at this stage. BA and American already have code-sharing agreements for certain flights.

BA and American face tougher competition at Heathrow next April, when a trans-Atlantic aviation treaty comes into force that allows any European airline to fly from all European airports to any destination in the United States and vice versa for U.S. carriers.

At present, BA and American are two of only four British and U.S. carriers allowed to fly to the United States from Heathrow.

Compiled from wire reports