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Southwest Airlines shares down premarket after warning natural disasters to hit third quarter revenue

Last updated: 14:14 28 Sep 2017 BST, First published: 09:14 28 Sep 2017 BST

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The company expects third-quarter operating revenue per available seat mile however to be flat to down 1%.

Southwest Airlines Co. (NYSE:LUV) has warned investors that the recent spate of natural disasters, including the hurricanes is expected to slice off around US$100mln its third quarter operating revenue.

In a statement, the airline said third-quarter available seat miles, a measure of capacity, is expected to increase about 3% from the year-earlier period.

The company expects third-quarter operating revenue per available seat mile however to be flat to down 1%.

Operating expense per available seat mile, excluding fuel costs, special items and profit-sharing costs, is expected to rise 3% to 4%.
Southwest is still expecting fuel costs of US$2.00 to US$2.05 a gallon, based on derivative contracts and market prices as of Sept. 22.

The airline had to cancel about 5,000 flights through September 28 because of several natural disasters, including hurricanes Harvey, Irma and Maria, and the earthquake in Mexico.

In premarket trade, its shares dropped 0.14% at US$55.80.

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