1 SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 _____________ FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of earliest event reported: April 21, 1999 AMR CORPORATION (Exact name of registrant as specified in its charter) Delaware 1-8400 75-1825172 (State of Incorporation) ( Commission File Number) (IRS Employer Identification No.) 4333 Amon Carter Blvd. Fort Worth, Texas 76155 (Address of principal executive offices) (Zip Code) (817) 963-1234 (Registrant's telephone number)
2 Item 5. Other Events AMR Corporation (the "Company") is filing herewith a press release issued April 21, 1999 by the Company as Exhibit 99.1 which is included herein. This press release was issued to report first quarter 1999 earnings and to announce the acceleration of the retirement of nine DC-10 widebody aircraft and 16 Boeing 727 narrowbody aircraft. Item 7. Financial Statements and Exhibits The following exhibits are included herein: 99.1 Press Release
3 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. AMR CORPORATION /s/ Charles D. MarLett Charles D. MarLett Corporate Secretary Dated: April 22, 1999
4 EXHIBIT INDEX Exhibit Description 99.1 Press Release
5 Exhibit 99.1 Contact: Corporate Communications Fort Worth, Texas 817-967-1577 FOR RELEASE: Wednesday, April 21, 1999 AMR REPORTS FIRST QUARTER EARNINGS OF $56 MILLION BEFORE SPECIAL ITEMS; BOARD ALSO APPROVES FLEET CHANGES FORT WORTH, Texas - AMR Corp., parent of American Airlines Inc., today reported first-quarter net earnings of $56 million, or $0.34 per common share diluted, before gains on the sales of certain assets. This was an 81 percent decrease compared with net earnings of $290 million, or $1.62 per common share diluted and adjusted for AMR's 1998 stock split, during the same period in 1998. Including the gains, AMR earned $158 million, or $0.96 per common share diluted. "We are obviously disappointed that the illegal job action undertaken by the Allied Pilots Association leadership so dramatically impacted our first quarter financial results," said Donald J. Carty, AMR's Chairman and CEO. "At the same time, the American Airlines team, including the thousands of pilots who reported to work during the job action, demonstrated their commitment and professionalism by serving our customers admirably during adverse circumstances." AMR also announced that as it prepares for the growth associated with the delivery of more than 115 new aircraft between 1999 and 2001, American Airlines has decided to accelerate the retirement of nine DC-10 widebody aircraft and 16 Boeing 727 narrowbodies. This will eliminate American's entire DC-10 fleet by the end of 2000. The retirement of the 727 fleet will advance one year to the end of 2003, instead of 2004 as originally planned. The new aircraft deliveries fuel the airline's continued growth plans, but the earlier retirements keep American's capacity in line with expected demand, which has slowed primarily due to weaker growth in international markets. Including the earlier retirements, American is positioned for average annual growth of approximately 3 to 3.5 percent through 2003. -- more --
6 AMR Reports First Quarter Earnings April 21, 1999 Page 2 "We will continue to grow the airline and look for new market opportunities. These accelerated retirements will not affect our total capacity until 2000 and 2001; they do, however underscore our commitment to keep capacity growth in line with global economic growth," said Carty. "This decision also demonstrates the flexibility of American's fleet planning to replace older aircraft with more efficient Boeing aircraft that the company is receiving over the next several years." Among AMR's first-quarter highlights: - -AMR Corp. board of directors authorized management to repurchase up to an additional $500 million of its common stock, bringing the cumulative total of AMR's repurchase programs since 1997 to $2.6 billion. - -American, British Airways, Canadian Airlines, Cathay Pacific and Qantas implemented the oneworld(TM) alliance. - -AA successfully booked its first reservation for the year 2000, validating the airline's extensive planning and investment for the turn of the century. - -American Airlines dedicated the new $120 million Terminal "B" facility at DFW, adding nine gates to its operations. - -AA celebrated the 40th anniversary of transcontinental jet service by announcing a new $1 billion terminal at New York Kennedy. American retraced the first flight from New York- Kennedy to Los Angeles with a new Boeing 757 painted in 1959 livery. - -AA received its first new Boeing 777-200IGW and 737-800, each fitted with the "new-look" interiors for the American fleet. On March 2, American introduced the two new aircraft types into passenger service on the same day - an industry first. - -AA announced it will strengthen its ties with Iberia and Finnair with their incorporation into the oneworld alliance. AA also began codesharing with Fiji's Air Pacific, and expanded codesharing with TAM and Qantas. - -AMR sold three non-airline subsidiaries - AMR Services, AMR Combs and TeleService Resources - to increase focus on its core airline and related technology businesses. The sales resulted in an after tax gain of $64 million. - -AMR sold a portion of its Equant holdings, which resulted in an after tax and minority interest gain of $37 million. --more--
7 AMR Reports First Quarter Earnings April 21, 1999 Page 3 - -AA announced new service between Houston Hobby and Washington's Reagan National Airports, building on the success of its Houston Hobby-New York LaGuardia service. - -AA completed the outfitting of its entire fleet with life-saving defibrillators and enhanced medical kits - an industry first. - -American Eagle began new ERJ-145 Regional Jet (RJ) service between Dallas/Fort Worth and both Knoxville, Tenn., and Jackson, Miss. The airline announced new RJ service between Chicago O'Hare and both Pittsburgh and Greenville/Spartanburg, S.C. It also announced it will in April replace turboprops with RJs between Chicago and both Madison, Wis. and Grand Rapids, Mich. - -American Eagle completed the acquisition of Business Express, a regional airline serving the northeastern United States. - -Nexos, AA's exclusive new Spanish and Portuguese language in- flight magazine, debuted on all Latin American flights. EDITORS: AMR's Chief Financial Officer, Gerard J. Arpey, will be available to answer questions during a telephone news conference today, from 2 p.m. to 2:45 p.m., CDT. Those interested in joining the conference should call 817- 967-1577 for details. ### Other AMR Corp. news releases can be accessed via the Internet. The address is http://www.amrcorp.com/corpcomm.htm
8 AMR CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (In millions, except per share amounts) Three Months Ended March 31, Percent 1999 1998 Change Revenues Airline Group Passenger - American Airlines $3,320 $3,578 (7.2) - AMR Eagle 271 256 5.9 Cargo 145 163 (11.0) Other 255 232 9.9 3,991 4,229 (5.6) Sabre 638 554 15.2 Other revenues 20 17 17.6 Less: Intersegment revenues (166) (166) - Total operating revenues 4,483 4,634 (3.3) Expenses Wages, salaries and benefits 1,665 1,559 6.8 Aircraft fuel 349 415 (15.9) Depreciation and amortization 316 318 (0.6) Commissions to agents 288 301 (4.3) Maintenance, materials and repairs 257 230 11.7 Other rentals and landing fees 240 213 12.7 Food service 167 164 1.8 Aircraft rentals 160 142 12.7 Other operating expenses 883 744 18.7 Total operating expenses 4,325 4,086 5.8 Operating Income 158 548 (71.2) Other Income (Expense) Interest income 25 34 (26.5) Interest expense (92) (97) (5.2) Interest capitalized 33 18 83.3 Minority interest (16) (13) 23.1 Miscellaneous - net 65 (13) * 15 (71) * Income From Continuing Operations Before Income Taxes 173 477 (63.7) Income tax provision 79 192 (58.9) Income From Continuing Operations 94 285 (67.0) Income From Discontinued Operations (net of applicable income taxes) - 5 - Gain on Sale of Discontinued Operations (net of applicable income taxes) 64 - * Net Earnings $ 158 $ 290 (45.5) * Greater Than 100% Continued on next page
9 AMR CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (CONTINUED) (Unaudited) (In millions, except per share amounts) Three Months Ended March 31, 1999 1998 Earnings Per Common Share Basic Before Discontinued Operations $ 0.59 $ 1.65 Discontinued Operations 0.40 0.03 Net Earnings $ 0.99 $ 1.68 Diluted Before Discontinued Operations $ 0.57 $ 1.59 Discontinued Operations 0.39 0.03 Net Earnings $ 0.96 $ 1.62 Number of Shares Used in Computation Basic 159 173 Diluted 164 179
10 AMR CORPORATION BUSINESS SEGMENT FINANCIAL HIGHLIGHTS (Unaudited) (In millions) Three Months Ended March 31, Percent 1999 1998 Change Airline Group Revenues Passenger - American Airlines $3,320 $3,578 (7.2) - AMR Eagle 271 256 5.9 Cargo 145 163 (11.0) Other 255 232 9.9 3,991 4,229 (5.6) Expenses Wages, salaries and benefits 1,462 1,384 5.6 Aircraft fuel 349 415 (15.9) Commissions to agents 288 301 (4.3) Maintenance, materials and repairs 257 229 12.2 Depreciation and amortization 253 258 (1.9) Other rentals and landing fees 228 204 11.8 Food service 167 164 1.8 Aircraft rentals 160 142 12.7 Other operating expenses 790 705 12.1 Total operating expenses 3,954 3,802 4.0 Operating Income 37 427 (91.3) Other Expense (6) (62) (90.3) Earnings Before Income Taxes $ 31 $ 365 (91.5) Pre-tax Margin 0.8% 8.6% (7.8) pts. Sabre Revenues $ 638 $ 554 15.2 Operating Expenses 526 439 19.8 Operating Income 112 115 (2.6) Other Income 37 2 * Earnings Before Income Taxes $ 149 $ 117 27.4 Pre-tax Margin 23.4% 21.1% 2.3 pts. * Greater Than 100%
11 Airline Group Operating Statistics (Unaudited) Three Months Ended March 31, Percent 1999 1998 Change American Airlines Jet Operations: Revenue passenger miles (millions) 25,290 25,388 (0.4) Available seat miles (millions) 37,703 37,707 - Cargo ton miles (millions) 431 496 (13.1) Passenger load factor 67.1% 67.3% (0.2) pts. Breakeven load factor 66.4% 58.3% 8.1 pts. Passenger revenue yield per passenger mile (cents) 13.13 14.09 (6.8) Passenger revenue per available seat mile (cents) 8.81 9.49 (7.2) Cargo revenue yield per ton mile (cents) 33.18 32.55 1.9 Operating expenses per available seat mile (cents) 9.63 9.35 3.0 Fuel consumption (gallons, in millions) 687 681 0.9 Fuel price per gallon (cents) 48.9 58.9 (17.0) Fuel price per gallon, excluding fuel taxes (cents) 44.6 53.9 (17.3) Operating aircraft at period-end 683 639 6.9 AMR Eagle: Revenue passenger miles (millions) 706 615 14.8 Available seat miles (millions) 1,211 1,071 13.1 Passenger load factor 58.3% 57.4% 0.9 pts. Operating aircraft at period-end 256 202 26.7 AMR Corporation Average Equivalent Number of Employees Airline Group: AA Jet Operations 82,500 80,800 Other 11,600 10,200 Total Airline Group 94,100 91,000 Sabre 12,200 10,700 Other 1,400 12,900 Total 107,700 114,600