United, Southwest Make Bank in Fourth Quarter Earnings

PHOTO: Profits are up at Southwest and United, as both carriers announced fourth quarter earnings.

United Continental Holdings Inc. and Southwest Airlines Co. both announced considerable 2013 fourth quarter profits this morning, a boon to the respective airlines, the industry and what many analysts believe to be a foreshadowing of what’s to come in 2014.

Revenue at United rose 7 percent to $9.3 billion, resulting in a fourth quarter profit of $140 million. That not only beat Wall Street expectations – profits were up 78 cents per share without special charges, beating analysts predictions of 66 cents per share profit – but it reversed last year’s dismal report when United lost $723 million as it struggled to integrate following the 2010 merger with Continental.

The airline said it expects to finish 2013 with $571 million to the good.

Lower fuel costs were one reason why United was able to turn a profit, as it was with Southwest. The Dallas-based carrier said this morning it saved almost 30 cents a gallon on fuel in 2013 compared to 2012, saving it $138 million in operating costs. Southwest’s $212 million in net income in the fourth quarter was up from $78 million year over year compared to 2012’s Q4.