Southwest Airlines 2014 Annual Report Download - page 67

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Other
Other (gains) losses, net, primarily includes amounts recorded as a result of the Company’s
hedging activities. See Note 10 to the Consolidated Financial Statements for further information on the
Company’s hedging activities. The following table displays the components of Other (gains) losses,
net, for the years ended December 31, 2014, and 2013:
Year ended December 31,
(in millions) 2014 2013
Mark-to-market impact from fuel contracts settling in future periods $ 251 $ (103)
Ineffectiveness from fuel hedges settling in future periods 5 11
Realized ineffectiveness and mark-to-market (gains) or losses (4) 3
Premium cost of fuel contracts 62 60
Other (5) (3)
$ 309 $ (32)
Income Taxes
The Company’s effective tax rate was approximately 37.4 percent for 2014, compared with
37.6 percent for 2013. On a non-GAAP basis, the Company currently projects a full year 2015
effective tax rate of approximately 37 to 39 percent based on forecasted financial results. However, the
Company’s effective tax rate during interim periods of 2015 may differ significantly from this full-year
estimate.
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