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Southwest to buy more shares, adding flight to Jamaica

Published:Friday | May 15, 2015 | 12:00 AM

Southwest Airlines Company is raising its dividend, buying back more of its own stock, and announcing new international flights from Houston.

At its annual meeting Wednesday, Southwest announced a new US$1.5-billion share-buyback programme and an increase in the quarterly dividend to 7.5 cents per share from six cents per share.

Southwest expects to add new and used planes this year and grow its fleet to about 700 by yearend, up from 679 on March 31. Analysts expressed concern about the rapid pace of growth, which they fear could drive down average fares.

Some of the airline's ground workers picketed outside the meeting in Houston to protest the lack of a new contract despite four years of negotiations. The pilots' union said on Tuesday that it is starting to prepare for a potential strike if it can't get a deal in the next several months.

Unions say they should share in the success of a company that earned a record US$1.14 billion last year. Shareholders prospered - the value of their stock jumped 125 per cent in 2014. Last month, Southwest reported a record first-quarter profit of US$453 million amid steady travel demand and lower fuel costs.

Later on Wednesday, Southwest announced it would start flying from Houston to Montego Bay in Jamaica, and Liberia, Costa Rica - a new destination for the airline - on November 1. The airline had announced several other international flights from Houston that will start in October.

- AP