Southwest Airlines 2002 Annual Report Download - page 64

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SOUTHWEST AIRLINES CO. 2002 10-K | 45
counterparty. At December 31, 2002, the
Company had agreements with seven counter-
parties containing early termination rights
and/or bilateral collateral provisions whereby
security is required if market risk exposure
exceeds a specified threshold amount or
credit ratings fall below certain levels. The
Company is in the process of negotiating
similar agreements with other counterparties.
The carrying amounts and estimated fair
values of the Company’s long-term debt at
December 31, 2002, were as follows:
(In thousands) Carrying value Estimated fair value
8 3/4% Notes due 2003 $ 100,000 $ 104,380
Aircraft Secured Notes due 2004 175,000 175,000
8% Notes due 2005 100,000 109,222
Pass Through Certificates 585,661 603,953
7 7/8% Notes due 2007 100,000 112,872
French Credit Agreements 50,024 50,024
6 1/2% Notes due 2012 385,000 402,213
7 3/8% Debentures due 2027 100,000 104,446
The estimated fair values of the Company’s long-term debt were based on quoted market prices.
The carrying values of all other financial instruments approximate their fair value.
10. Comprehensive Income
Comprehensive income includes changes
in the fair value of certain financial derivative
instruments, which qualify for hedge
accounting, and unrealized gains and losses
on certain investments. Comprehensive
income totaled $326.2 million and
$479.6 million for 2002 and 2001,
respectively. The differences between Net
income and Comprehensive income for 2002
and 2001 are as follows:
(In thousands) 2002 2001
Net income $ 240,969 $ 511,147
Unrealized gain (loss) on derivative instruments,
net of deferred taxes of $56,338 and ($20,719) 87,213 (31,063)
Other, net of deferred taxes of ($1,302) and
($320) (2,017) (475)
Total other comprehensive income (loss) 85,196 (31,538)
Comprehensive income $ 326,165 $ 479,609