Southwest Airlines (LUV) today issued an Investor Update in a form of SEC filing that was reviewed by Idaho Reporter.
Southwest reports that expected cash-burn rate – a closely watched number that paints an image into how much cash an airline is spending to keep operations without a profit-will be lower than expected in Q2.
The Company now estimates its average daily core cash burn to be in the range of $20 million to $25 million in second quarter 2020, with an estimated average daily core cash burn of approximately $20 million in June 2020.Southwest Airlines
This compares favorably with the Southwest’s previous estimate of average daily core cash burn of approximately $25 million in second quarter 2020, and the low-$20 million range in June 2020, primarily due to modest improvements in revenue estimates in second quarter 2020.
The Company currently estimates approximately 24 months of liquidity and according to Southwest:”The Company also has adjusted debt to average invested capital (leverage) of 49 percent and is the only U.S. airline with an investment-grade rating by all three rating agencies.”
LVU stock price is slightly up on Tuesday and Wednesday, however ahead of the Company is a rocky road to recovery.