Southwest closes on AirTran merger in May, earnings and record metrics posted in 1Q

Southwest CEO Gary Kelly surprised analysts on Thursday by announcing the company will close its merger with AirTran on 02-May-2011. The announcement caught everyone off guard, but it wasn’t until late in the Q&A session that Bank of American/Merrill Lynch Analyst Glenn Engel asked how it could close without receiving approval from the US Department of Justice. The rest of the analysts must have been wondering, as was the press, how they missed a story as important as the DOJ approval. [3604 words]

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This report contains the following subheadings:

• Net down on increased costs, but records set
• Rising fares help
• 1Q2011 results
• Revenues
• Expenses
• Guidance