Executive Level Financial Report Southwest Airlines
Finance 330

CEO
Southwest Airlines
P.O. Box 36611

2702 Love Field Drive

Dallas, TX 75235

Southwest Airlines began its career, serving customers throughout Texas. Over the years it has grown into one of the largest domestic airlines in the United States. It is recognized in the United States' as the “most successful low fare, high frequency, point-to-point carrier”(www.southwest.com). It services 72 cities in 37 states with about 550 Boeing 737 aircraft.

Southwest took a big hit during the economic crisis in 2008 and 2009, but has seen a significant turn around in 2010.

This report will evaluate the financial and stock performance of Southwest Airlines for 2008, 2009, and 2010, as well as a comparative evaluation of Southwest’s financial and stock performance against its industry. A look into Southwest Airlines past and present stock performance will also be included. Based off the collected data a better understanding of Southwest Airline’s financial strength and the possibility of a long-term commitment can be concluded.

FINANCIAL CONDITION COMPANY INDUSTRY
Debt/Equity Ratio 0.59 0.77
Current Ratio 1 1
Quick Ratio 0.9 0.9
Interest Coverage 5.9 6.6
Leverage Ratio 2.6 3.7
Book Value/Share 8.96 9.96
MANAGEMENT EFFICIENCY COMPANY INDUSTRY
Inventory Turnover 33.3 262.4
The current ratio for Southwest Airlines is 1.0. So, for every dollar Southwest owes in short-term debts, it has a $1.00 available in assets that can be switched to cash that can go towards its short-term debts. Compared to their industry, Southwest is meeting short-term financing much like its competition. The debt/equity ratio is 0.59, which shows that equity finances most of Southwest’s debt. This leaves less of a risk for the company since they do not have to worry about interest rates from debt