UNITED
STATES
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:
July 16, 2008
|
American
Airlines, Inc.
|
|
(Exact
name of registrant as specified in its
charter)
|
|
Delaware
|
1-2691
|
13-1502798
|
|
(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)
|
(Former
name or former address, if changed since last report.)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
[
] Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
[
] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
[
] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[
] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
|
Item
2.02
|
Results of Operations
and Financial Condition
|
American
Airlines, Inc. is furnishing herewith a press release issued on July 16, 2008 by
its parent company, AMR Corporation (AMR), as Exhibit 99.1, which is included
herein. This press release was issued to report AMR’s second quarter
2008 results.
|
Item 9.01
|
Financial Statements
and Exhibits
|
|||
|
(c)
Exhibits
|
||||
|
Exhibit
99.1
|
Press
Release of AMR dated July 16, 2008
|
|||
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.
|
American
Airlines, Inc.
|
|
|
/s/ Kenneth W. Wimberly
|
|
|
Kenneth
W. Wimberly
|
|
|
Corporate
Secretary
|
Dated: July
16, 2008
EXHIBIT
INDEX
|
Exhibit
|
Description
|
|
|
99.1
|
Press
Release
|
CONTACT:
Andy Backover
Corporate
Communications
Fort
Worth, Texas
817-967-1577
corp.comm@aa.com
FOR
RELEASE: Wednesday, July 16, 2008
Editor's
Note: A live Webcast reporting second quarter results will be
broadcast on the Internet on July 16 at 2 p.m. EDT (Windows Media Player
required for viewing)
AMR
CORPORATION REPORTS SECOND QUARTER 2008 LOSS OF $284 MILLION EXCLUDING SPECIAL
ITEMS, AS RECORD FUEL PRICES DROVE $838 MILLION IN HIGHER COSTS COMPARED TO A
YEAR AGO
Second
Quarter Net Loss Of $1.4 Billion Includes $1.2 Billion In Non-Cash Impairment
Charges And Severance-Related Charges
Company
Ends Second Quarter With $5.5 Billion In Total Cash And Announces $500 Million
In Additional Financing To Further Bolster Liquidity
In
Response To Fuel And Economic Challenges, AMR Plans To Reduce 2009 Capacity
Through Early Retirement Of A300 Fleet And Expects Additional Capacity
Reductions Next Year
FORT
WORTH, Texas – AMR Corporation, the parent company of American Airlines, Inc.,
today reported a net loss of $1.4 billion for the second quarter of 2008, or
$5.77 per share.
The
second quarter results include special charges as previously disclosed in AMR’s
Form 8-K filing with the Securities and Exchange Commission on July 2. These
include a $1.1 billion non-cash accounting charge to write down the value of
certain aircraft and related long-lived assets to their estimated fair value and
a charge of approximately $55 million of a total $70 million expected for
severance-related costs resulting from the Company’s system-wide capacity
reductions in the fourth quarter of this year. The remainder of the
severance-related charge is expected to be taken in the third quarter. Excluding
these special charges, AMR reported a second quarter net loss of $284 million,
or $1.13 per share.
The
current quarter results compare to a net profit of $317 million for the second
quarter of 2007, or $1.08 per diluted share.
Record
jet fuel prices contributed significantly to the Company’s loss in the second
quarter of 2008. AMR paid $3.19 per gallon for jet fuel in the second quarter
compared to $2.09 a gallon in the second quarter of 2007, a 53 percent increase.
As a result, the Company paid $838 million more for fuel in the second quarter
of 2008 than it would have paid at prevailing prices from the prior-year
period.
“Our
company continues to be severely challenged by the fuel crisis that has
afflicted our entire industry, and we expect these difficulties to continue for
the foreseeable future,” said AMR Chairman and CEO Gerard Arpey. “Clearly, our
second quarter results were disappointing, but I am also pleased with our
efforts as a company to take difficult but necessary steps to manage through
this uncertainty. While we believe the airline industry cannot continue in its
current form at today’s record fuel prices, we also believe our decisions and
hard work by employees in recent years have better prepared us to face these
challenges. We remain committed to taking action – whether that relates to
capacity reductions, revenue enhancements, fleet changes or other efforts to
improve our financial foundation – as we work to secure our long-term
future.”
AMR
highlighted additional actions it has taken in response to the ongoing
challenges of record fuel prices and a softer economy. The Company has obtained
$720 million in new financing through a number of transactions, including the
sale of certain aircraft that will remain in the Company’s fleet through a lease
agreement, and through newly issued mortgage debt that is secured by aircraft.
Of the new financing, approximately $500 million was received in July and will
be recorded in the Company’s cash balance in the third quarter of
2008.
In
addition, AMR has decided to retire all 34 of its A300 aircraft by the end of
2009, compared to the previous retirement schedule that extended through 2012.
In 2008, AMR will retire 30 MD-80s, 10 A300s and 26 Saab turbo-prop aircraft,
and will retire or remove from service 37 regional jets. The remaining A300s
will be retired in 2009, which is expected to result in capacity reductions next
year. As it begins to replace its MD-80 fleet, the Company continues to expect
to take delivery of 70 more-fuel-efficient 737-800 aircraft in 2009 and
2010.
Given the
current industry environment, AMR has decided to place on hold its planned
divestiture of American Eagle, its regional affiliate, until industry conditions
are more stable and favorable. AMR continues to believe that a divestiture makes
sense in the long term for AMR, American, American Eagle and their stakeholders
but AMR also believes that a divestiture is not sensible amid current
conditions.
Operational
Performance
AMR
reported second quarter consolidated revenues of approximately $6.2 billion, an
increase of 5.1 percent year over year.
American’s
mainline passenger revenue per available seat mile (unit revenue) increased by
7.0 percent in the second quarter compared to the year-ago quarter. (Please
refer to the reconciliation tables at the end of this press release for a
calculation of the impact of the recent reclassification of AAdvantage revenue
received from the sale of third-party miles from Passenger Revenue to Other
Revenue.)
Mainline
capacity, or total available seat miles, in the second quarter decreased by 2.2
percent compared to the same period in 2007.
American's
mainline load factor – or the percentage of total seats filled – was 82.5
percent during the second quarter, compared to 83.6 percent in the second
quarter of 2007. American’s second-quarter yield, which represents average fares
paid, increased 8.5 percent compared to the second quarter of 2007, its 13th
consecutive quarter of year-over-year yield increases.
American's
mainline cost per available seat mile (unit cost), excluding special items,
increased 19.3 percent in the second quarter compared to the same period in
2007, largely due to higher fuel expense. Excluding fuel and special items,
mainline unit costs in the second quarter of 2008 increased by 5.1 percent year
over year.
Balance
Sheet Update
AMR ended
the second quarter with $5.5 billion in cash and short-term investments,
including a restricted balance of $434 million. The second quarter 2008 cash
balance includes $220 million received through financings involving aircraft
mortgage and sale-leaseback transactions. As referred to above, the $500 million
in additional aircraft financing was received after the second quarter ended
and, as such, will be applied to AMR’s third quarter 2008 cash balance. AMR
continues to expect the previously announced sale of American Beacon Advisors,
Inc., valued at $480 million in total consideration, to be completed in the
third quarter of 2008. At the end of the second quarter of 2007 AMR had $6.4
billion in cash and short-term investments, including a restricted balance of
$470 million.
AMR’s
Total Debt, which it defines as the aggregate of its long-term debt, capital
lease obligations, the principal amount of airport facility tax-exempt bonds,
and the present value of aircraft operating lease obligations, was $15.2 billion
at the end of the second quarter of 2008, compared to $17.3 billion at the end
of the second quarter of 2007. AMR’s Net Debt, which it defines as Total Debt
less unrestricted cash and short-term investments, was $10.1 billion at the end
of the second quarter of 2008, compared to $11.4 billion at the end of the
second quarter of 2007.
As of
July 15, AMR had contributed $78 million to its employees’ defined benefit
pension plans in 2008. AMR has contributed more than $2 billion to its employee
defined benefit pension plans since the beginning of 2002.
Second
Quarter and Other Recent Highlights
|
·
|
AMR
announced that it recently signed a new multi-year contract with Citibank,
its valued AAdvantage program partner. The Company said it expects to see
some of the benefits of this new agreement immediately, with the full
benefits being phased in by 2010.
|
|
·
|
American
Airlines Cargo Division (AA Cargo) received the “Customer Excellence and
Innovation” award from Descartes Systems Group, a global logistics
solutions provider. American was recognized for its excellence and
innovation in the implementation of the company’s electronic cargo booking
system.
|
|
·
|
American
began a new chapter in its more than 80-year history by launching its
first flight from the United States to Russia. American became
the first U.S. air carrier to fly directly out of Chicago O’Hare
International Airport to Moscow’s Domodedovo International Airport
(DME).
|
|
·
|
American
took another significant step to enhance the overall travel experience for
customers by adding thousands of additional hotel properties to AA.com.
The additions make AA.com a compelling resource for booking hotel
stays.
|
Guidance
Mainline and Consolidated
Capacity
Following
its capacity reduction announcement in May, AMR expects its full-year mainline
capacity to decrease by 3.4 percent in 2008 compared to 2007, with a 5.7 percent
reduction in domestic capacity and a 0.7 percent increase in international
capacity compared to 2007 levels. On a consolidated basis, AMR
expects full-year capacity to decrease by 3.7 percent in 2008 compared to
2007.
AMR
expects mainline capacity in the third quarter of 2008 to decrease by 2.7
percent year over year. It expects consolidated capacity to decrease by 3.0
percent in the third quarter of 2008 compared to the prior-year
period.
As
disclosed on May 21, AMR expects system-wide capacity to decline by 7 percent to
8 percent in the fourth quarter of 2008 compared to fourth quarter 2007 levels,
with fourth quarter mainline domestic capacity expected to decline by 11 percent
to 12 percent and fourth quarter regional affiliate capacity expected to decline
by 10 percent to 11 percent compared to the same period in 2007.
Beyond
the expected 2009 capacity reductions resulting from the retirement of the
A300s, given current fuel price and economic trends, the Company expects to make
additional capacity reductions in 2009.
Fuel Expense and
Hedging
While the
cost of jet fuel remains very volatile, AMR is planning for an average system
price of $3.81 per gallon in the third quarter of 2008 and $3.42 a gallon for
all of 2008. AMR has 35 percent of its anticipated third quarter 2008 fuel
consumption capped at an average crude equivalent of $95 per barrel (jet fuel
equivalent of $2.92 per gallon), with 34 percent of its anticipated full-year
consumption capped at an average crude equivalent of $82 per barrel (jet fuel
equivalent of $2.60 per gallon). Consolidated consumption for the third quarter
is expected to be 772 million gallons of jet fuel.
Mainline and Consolidated
Unit Costs (excluding special items)
For the
third quarter of 2008, mainline unit costs are expected to increase 26.1 percent
compared to the third quarter of 2007, while third quarter consolidated unit
costs are expected to increase 25.7 percent compared to the third quarter of
2007.
In the
third quarter of 2008, mainline unit costs excluding fuel are expected to
increase 3.6 percent year over year while consolidated unit costs excluding fuel
are expected to increase 3.9 percent from the third quarter of
2007.
Full-year
mainline unit costs are expected to increase 21.5 percent in 2008 compared to
2007, while full-year consolidated unit costs are expected to increase 21.2
percent in 2008 compared to 2007.
AMR
expects mainline unit costs excluding fuel to be 4.1 percent higher in 2008
versus 2007, while 2008 consolidated unit costs excluding fuel are expected to
increase 4.6 percent year over year.
Editor’s
Note: AMR’s Chairman and Chief Executive Officer, Gerard Arpey, and
its Executive Vice President and Chief Financial Officer, Thomas Horton, will
make a presentation to analysts during a teleconference on Wednesday, July 16,
at 2 p.m. EDT. Following the analyst call, they will hold a
question-and-answer conference call for media. Reporters interested
in listening to the presentation or participating in the media Q&A should
call 817-967-1577.
Statements
in this release contain various forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended, which represent the Company's
expectations or beliefs concerning future events. When used in this
release, the words "expects," "plans," "anticipates," “indicates,” “believes,”
“forecast,” “guidance,” “outlook,” "may," "will," "should," “seeks,” “targets”
and similar expressions are intended to identify forward-looking
statements. Similarly, statements that describe the Company's
objectives, plans or goals are forward-looking
statements. Forward-looking statements include, without limitation,
the Company’s expectations concerning operations and financial conditions,
including changes in capacity, revenues and costs; future financing plans and
needs; fleet plans; overall economic and industry conditions; plans and
objectives for future operations; and the impact on the Company of its results
of operations in recent years and the sufficiency of its financial resources to
absorb that impact. Other forward-looking statements include statements which do
not relate solely to historical facts, such as, without limitation, statements
which discuss the possible future effects of current known trends or
uncertainties or which indicate that the future effects of known trends or
uncertainties cannot be predicted, guaranteed or assured. All
forward-looking statements in this release are based upon information available
to the Company on the date of this release. The Company undertakes no obligation
to publicly update or revise any forward-looking
statement, whether as a result of new information, future events, or
otherwise.
Forward-looking
statements are subject to a number of factors that could cause the Company’s
actual results to differ materially from the Company’s
expectations. The following factors, in addition to other possible
factors not listed, could cause the Company’s actual results to differ
materially from those expressed in forward-looking statements: the
materially weakened financial condition of the Company, resulting from its
significant losses in recent years; the ability of the Company to generate
additional revenues and reduce its costs; changes in economic and other
conditions beyond the
Company’s
control, and the volatile results of the Company’s operations; the Company’s
substantial indebtedness and other obligations; the ability of the Company to
satisfy existing financial or other covenants in certain of its credit
agreements; continued high and volatile fuel prices and further increases in the
price of fuel, and the availability of fuel; the
fiercely
and increasingly competitive business environment faced by the Company; industry
consolidation; competition with reorganized carriers; low fare levels by
historical standards and the Company’s reduced pricing power; the Company’s need
to raise additional funds and its ability to do so on acceptable terms; changes
in the Company’s corporate or business strategy; government regulation of the
Company’s business; conflicts overseas or terrorist attacks; uncertainties with
respect to the Company’s international operations; outbreaks of a disease (such
as SARS or avian flu) that affects travel behavior; labor costs that are higher
than those of the Company’s competitors; uncertainties with respect to the
Company’s relationships with unionized and other employee work groups; increased
insurance costs and potential reductions of available insurance coverage; the
Company’s ability to retain key management personnel; potential failures or
disruptions of the Company’s computer, communications or other technology
systems; changes in the price of the Company’s common stock; and the ability of
the Company to reach acceptable agreements with third
parties. Additional information concerning these and other factors is
contained in the Company’s Securities and Exchange Commission filings, including
but not limited to the Company’s Annual Report on Form 10-K for the year ended
December 31, 2007.
Detailed
financial information follows:
AMR
CORPORATION
CONSOLIDATED
STATEMENTS OF OPERATIONS
(as
reclassified)
(in
millions, except per share amounts)
(Unaudited)
|
Three
Months Ended June 30,
|
Percent
|
|||||||||||
|
2008
|
2007
|
Change
|
||||||||||
|
Revenues
|
||||||||||||
|
Passenger
- American Airlines
|
$ | 4,735 | $ | 4,525 | 4.6 | |||||||
|
-
Regional Affiliates
|
683 | 658 | 3.8 | |||||||||
|
Cargo
|
233 | 200 | 16.5 | |||||||||
|
Other
revenues
|
528 | 496 | 6.5 | |||||||||
|
Total
operating revenues
|
6,179 | 5,879 | 5.1 | |||||||||
|
Expenses
|
||||||||||||
|
Aircraft
fuel
|
2,423 | 1,644 | 47.4 | |||||||||
|
Wages,
salaries and benefits
|
1,658 | 1,655 | 0.2 | |||||||||
|
Other
rentals and landing fees
|
318 | 313 | 1.6 | |||||||||
|
Depreciation
and amortization
|
324 | 295 | 9.8 | |||||||||
|
Maintenance,
materials and repairs
|
323 | 268 | 20.5 | |||||||||
|
Commissions,
booking fees and credit card expense
|
259 | 268 | (3.4 | ) | ||||||||
|
Aircraft
rentals
|
125 | 152 | (17.8 | ) | ||||||||
|
Food
service
|
133 | 133 | - | |||||||||
|
Special
charges
|
1,164 | - | * | |||||||||
|
Other
operating expenses
|
742 | 684 | 8.5 | |||||||||
|
Total
operating expenses
|
7,469 | 5,412 | 38.0 | |||||||||
|
Operating
Income
|
(1,290 | ) | 467 | * | ||||||||
|
Other
Income (Expense)
|
||||||||||||
|
Interest
income
|
48 | 90 | (46.7 | ) | ||||||||
|
Interest
expense
|
(185 | ) | (235 | ) | (21.3 | ) | ||||||
|
Interest
capitalized
|
8 | 5 | 60.0 | |||||||||
|
Miscellaneous
– net
|
(29 | ) | (10 | ) | * | |||||||
| (158 | ) | (150 | ) | 5.3 | ||||||||
|
Income/(Loss)
Before Income Taxes
|
(1,448 | ) | 317 | * | ||||||||
|
Income
tax
|
- | - | - | |||||||||
|
Net
Income
|
$ | (1,448 | ) | $ | 317 | * | ||||||
|
Earnings/(Loss)
Per Share
|
||||||||
|
Basic
|
$ | (5.77 | ) | $ | 1.28 | |||
|
Diluted
|
$ | (5.77 | ) | $ | 1.08 | |||
|
Number
of Shares Used in Computation
|
||||||||
|
Basic
|
251 | 246 | ||||||
|
Diluted
|
251 | 299 | ||||||
* Greater
than 100%
AMR
CORPORATION
OPERATING
STATISTICS
(as
reclassified)
(Unaudited)
|
Three
Months Ended
June
30,
|
Percent
|
|||||||||||
|
2008
|
2007
|
Change
|
||||||||||
|
American
Airlines, Inc. Mainline Jet Operations
|
||||||||||||
|
Revenue
passenger miles (millions)
|
34,399 | 35,669 | (3.6 | ) | ||||||||
|
Available
seat miles (millions)
|
41,718 | 42,647 | (2.2 | ) | ||||||||
|
Cargo
ton miles (millions)
|
533 | 536 |
(0.6
|
) | ||||||||
|
Passenger
load factor
|
82.5 | % | 83.6 | % |
(1.1)
|
pts | ||||||
|
Passenger
revenue yield per passenger mile (cents)
|
13.76 | 12.68 | 8.5 | |||||||||
|
Passenger
revenue per available seat mile (cents)
|
11.35 | 10.61 | 7.0 | |||||||||
|
Cargo
revenue yield per ton mile (cents)
|
43.74 | 37.25 | 17.4 | |||||||||
|
Operating expenses per available seat mile, excluding Regional
Affiliates (cents) (1)
|
15.80 | 11.14 | 41.8 | |||||||||
|
Fuel
consumption (gallons, in millions)
|
688 | 713 | (3.5 | ) | ||||||||
|
Fuel
price per gallon (cents)
|
317.3 | 207.5 | 52.9 | |||||||||
|
Regional
Affiliates
|
||||||||||||
|
Revenue
passenger miles (millions)
|
2,400 | 2,595 | (7.5 | ) | ||||||||
|
Available
seat miles (millions)
|
3,274 | 3,380 | (3.1 | ) | ||||||||
|
Passenger
load factor
|
73.3 | % | 76.8 | % |
(3.5)
|
pts | ||||||
|
AMR
Corporation
|
||||||||||||
|
Average
Equivalent Number of Employees
|
||||||||||||
|
American
Airlines
|
72,200 | 71,800 | ||||||||||
|
Other
|
13,500 | 13,700 | ||||||||||
|
Total
|
85,700 | 85,500 | ||||||||||
|
(1)
|
Excludes
$904 million and $710 million of expense incurred related to Regional
Affiliates in 2008 and 2007,
respectively.
|
AMR
CORPORATION
OPERATING
STATISTICS
(Unaudited)
OPERATING
STATISTICS BY REGIONAL ENTITY
|
American
Airlines, Inc.
|
Three
Months Ended June 30, 2008
|
|||||||||||||||
|
Entity
Results
|
RASM1
(cents)
|
Y-O-Y
Change
|
ASMs2
(billions)
|
Y-O-Y
Change
|
||||||||||||
|
DOT
Domestic
|
11.27 | 5.9 | % | 26.1 | (3.6 | )% | ||||||||||
|
International
|
11.49 | 8.7 | 15.6 | 0.3 | ||||||||||||
|
DOT
Latin America
|
11.73 | 10.2 | 7.4 | 2.8 | ||||||||||||
|
DOT
Atlantic
|
11.29 | 6.0 | 6.5 | (2.2 | ) | |||||||||||
|
DOT
Pacific
|
11.20 | 12.8 | 1.7 | (0.8 | ) | |||||||||||
|
American
Airlines, Inc.
|
Three
Months Ended June 30, 2008
|
|||||||||||||||
|
Entity
Results
|
Load
Factor
(pts)
|
Y-O-Y
Change
(pts)
|
Yield
(cents)
|
Y-O-Y
Change
|
||||||||||||
|
DOT
Domestic
|
84.4 | (1.6 | ) | 13.35 | 8.0 | % | ||||||||||
|
International
|
79.2 | (0.3 | ) | 14.51 | 9.1 | |||||||||||
|
DOT
Latin America
|
76.3 | 0.6 | 15.38 | 9.4 | ||||||||||||
|
DOT
Atlantic
|
81.2 | (1.2 | ) | 13.90 | 7.6 | |||||||||||
|
DOT
Pacific
|
84.1 | 0.4 | 13.31 | 12.2 | ||||||||||||
1 Revenue
per Available Seat Mile
2
Available Seat Miles
AMR
CORPORATION
NON-GAAP
AND OTHER RECONCILIATIONS
(Unaudited)
|
American
Airlines, Inc. Mainline Jet Operations
|
Three
Months Ended June 30,
|
|||||||
|
(in
millions, except as noted)
|
2008
|
2007
|
||||||
|
Total operating expenses
|
$ | 7,494 | $ | 5,460 | ||||
|
Less: Operating expenses
incurred related to Regional Affiliates
|
904 | 710 | ||||||
|
Operating expenses excluding expenses incurred related to Regional
Affiliates
|
$ | 6,590 | $ | 4,750 | ||||
|
American
mainline jet operations available seat miles
|
41,718 | 42,647 | ||||||
|
Operating expenses per available seat mile, excluding Regional Affiliates
(cents)
|
15.80 | 11.14 | ||||||
|
Percent change
|
41.8 | % | ||||||
|
American
Airlines, Inc. Mainline Jet Operations
|
Three
Months Ended June 30,
|
|||||||
|
(in
millions, except as noted)
|
2008
|
2007
|
||||||
|
Total
operating expenses
|
$ | 7,494 | $ | 5,460 | ||||
|
Less: Operating expenses incurred related to Regional
Affiliates
|
904 | 710 | ||||||
|
Operating expenses excluding expenses incurred related to Regional
Affiliates
|
$ | 6,590 | $ | 4,750 | ||||
|
American
mainline jet operations available seat miles
|
41,718 | 42,647 | ||||||
|
Operating expenses per available seat mile, excluding Regional Affiliates
(cents)
|
15.80 | 11.14 | ||||||
|
Less: Impact of special items
|
2.51 | - | ||||||
|
Operating expenses per available seat mile, excluding impact of special
items (cents)
|
13.29 | 11.14 | ||||||
|
Percent change
|
19.3 | % | ||||||
AMR
CORPORATION
NON-GAAP
AND OTHER RECONCILIATIONS
(Unaudited)
|
American
Airlines, Inc. Mainline Jet Operations
|
Three
Months Ended June 30,
|
|||||||
|
(in
millions, except as noted)
|
2008
|
2007
|
||||||
|
Total
operating expenses
|
$ | 7,494 | $ | 5,460 | ||||
|
Less: Operating expenses incurred related to Regional
Affiliates
|
904 | 710 | ||||||
|
Operating expenses excluding expenses incurred related to Regional
Affiliates
|
$ | 6,590 | $ | 4,750 | ||||
|
American
mainline jet operations available seat miles
|
41,718 | 42,647 | ||||||
|
Operating expenses per available seat mile, excluding Regional Affiliates
(cents)
|
15.80 | 11.14 | ||||||
|
Less: Fuel cost per available seat mile (cents)
|
5.23 | 3.47 | ||||||
|
Less: Impact of special items
|
2.51 | - | ||||||
|
Operating expenses per available seat mile, excluding impact of special
items and the cost of fuel (cents)
|
8.06 | 7.67 | ||||||
|
Percent change
|
5.1 | % | ||||||
Note: The
Company believes that operating expenses per available seat mile, excluding the
cost of fuel and special items assists investors in understanding the impact of
fuel prices and special items on the Company’s operations.
AMR
CORPORATION
NON-GAAP
AND OTHER RECONCILIATIONS
(Unaudited)
|
AMR
Corporation
Calculation
of Net Debt
|
As
of June 30
|
|||||||
|
(in
millions, except as noted)
|
2008
|
2007
|
||||||
|
Current
and long-term debt
|
$ | 10,133 | $ | 11,705 | ||||
|
Current and long-term capital lease obligations
|
756 | 854 | ||||||
|
Principal
amount of certain airport facility tax-exempt bonds and the present value
of aircraft operating lease obligations
|
4,295 | 4,691 | ||||||
| 15,184 | 17,250 | |||||||
|
Less: Unrestricted cash and short-term
investments
|
5,069 | 5,900 | ||||||
|
Net Debt
|
$ | 10,115 | $ | 11,350 | ||||
Note: The
Company believes the net debt metric assists investors in understanding changes
in the Company’s liquidity and the results of its efforts to build a financial
foundation under the Company’s Turnaround Plan.
AMR
CORPORATION
NON-GAAP
AND OTHER RECONCILIATIONS
(Unaudited)
|
American
Airlines, Inc. Mainline Jet Operations
|
Estimate
for
Year
Ended December 31,
|
|||||||
|
(in
millions, except as noted)
|
2008
|
2007
|
||||||
|
Operating
expenses per available seat mile, excluding Regional Affiliates
(cents)
|
14.39 | 11.38 | ||||||
|
Less:
Impact of special items (cents)
|
0.64 | 0.06 | ||||||
|
Operating expenses per available seat mile, excluding Regional Affiliates
and impact of special items (cents)
|
13.75 | 11.32 | ||||||
|
Percent change
|
21.5 | % | ||||||
|
American
Airlines, Inc. Mainline Jet Operations
|
Estimate
for
Year
Ended December 31,
|
|||||||
|
(in
millions, except as noted)
|
2008
|
2007
|
||||||
|
Operating
expenses per available seat mile, excluding Regional Affiliates
(cents)
|
14.39 | 11.38 | ||||||
|
Less:
Impact of special items (cents)
|
0.64 | 0.06 | ||||||
|
Less: Fuel expense per available seat mile (cents)
|
5.64 | 3.53 | ||||||
|
Operating expenses per available seat mile, excluding Regional Affiliates,
impact of special items and fuel expense (cents)
|
8.11 | 7.79 | ||||||
|
Percent change
|
4.1 | % | ||||||
|
American
Airlines, Inc. Mainline Jet Operations
|
Estimate
for
Three
Months Ended September 30,
|
|||||||
|
(in
millions, except as noted)
|
2008
|
2007
|
||||||
|
Operating
expenses per available seat mile, excluding Regional Affiliates
(cents)
|
14.33 | 11.45 | ||||||
|
Less:
Impact of special items (cents)
|
- | 0.09 | ||||||
|
Operating expenses per available seat mile, excluding Regional Affiliates
and impact of special items (cents)
|
14.33 | 11.36 | ||||||
|
Percent change
|
26.1 | % | ||||||
|
American
Airlines, Inc. Mainline Jet Operations
|
Estimate
for
Three
Months Ended September 30,
|
|||||||
|
(in
millions, except as noted)
|
2008
|
2007
|
||||||
|
Operating
expenses per available seat mile, excluding Regional Affiliates
(cents)
|
14.33 | 11.45 | ||||||
|
Less:
Impact of special items (cents)
|
- | 0.09 | ||||||
|
Less: Fuel expense per available seat mile (cents)
|
6.32 | 3.63 | ||||||
|
Operating expenses per available seat mile, excluding Regional Affiliates,
impact of special items and fuel expense (cents)
|
8.01 | 7.73 | ||||||
|
Percent change
|
3.6 | % | ||||||
AMR
CORPORATION
NON-GAAP
AND OTHER RECONCILIATIONS
(Unaudited)
|
AMR
Corporation
|
Estimate
for
Year
Ended December 31,
|
|||||||
|
(in
millions, except as noted)
|
2008
|
2007
|
||||||
|
Operating
expenses per available seat mile (cents)
|
15.12 | 11.98 | ||||||
|
Less:
Impact of special items (cents)
|
0.66 | 0.05 | ||||||
|
Operating expenses per available seat mile, excluding impact of special
items (cents)
|
14.46 | 11.93 | ||||||
|
Percent change
|
21.2 | % | ||||||
|
AMR
Corporation
|
Estimate
for
Year
Ended December 31,
|
|||||||
|
(in
millions, except as noted)
|
2008
|
2007
|
||||||
|
Operating
expenses per available seat mile (cents)
|
15.12 | 11.98 | ||||||
|
Less:
Impact of special items (cents)
|
0.66 | 0.05 | ||||||
|
Less: Fuel expense per available seat mile (cents)
|
5.79 | 3.64 | ||||||
|
Operating expenses per available seat mile, excluding impact of special
items and fuel expense (cents)
|
8.67 | 8.29 | ||||||
|
Percent change
|
4.6 | % | ||||||
|
AMR
Corporation
|
Estimate
for
Three
Months Ended September 30,
|
|||||||
|
(in
millions, except as noted)
|
2008
|
2007
|
||||||
|
Operating
expenses per available seat mile (cents)
|
15.03 | 12.05 | ||||||
|
Less:
Impact of special items (cents)
|
- | 0.09 | ||||||
|
Operating expenses per available seat mile, excluding impact of special
items (cents)
|
15.03 | 11.96 | ||||||
|
Percent change
|
25.7 | % | ||||||
|
AMR
Corporation
|
Estimate
for
Three
Months Ended September 30,
|
|||||||
|
(in
millions, except as noted)
|
2008
|
2007
|
||||||
|
Operating
expenses per available seat mile (cents)
|
15.03 | 12.05 | ||||||
|
Less:
Impact of special items (cents)
|
- | 0.09 | ||||||
|
Less: Fuel expense per available seat mile (cents)
|
6.48 | 3.73 | ||||||
|
Operating expenses per available seat mile, excluding impact of special
items and fuel expense (cents)
|
8.55 | 8.23 | ||||||
|
Percent change
|
3.9 | % | ||||||
AMR
CORPORATION
NON-GAAP
AND OTHER RECONCILIATIONS
(Unaudited)
|
AMR
Corporation
|
Three
Months Ended June 30,
|
|||||||
|
(in
millions, except as noted)
|
2008
|
2007
|
||||||
|
Operating
expenses per available seat mile (cents)
|
16.60 | 11.76 | ||||||
|
Less: Impact of special items (cents)
|
2.59 | - | ||||||
|
Operating expenses per available seat mile, excluding impact of special
items (cents)
|
14.01 | 11.76 | ||||||
|
Percent change
|
19.1 | % | ||||||
|
AMR
Corporation
|
Three
Months Ended June 30,
|
|||||||
|
(in
millions, except as noted)
|
2008
|
2007
|
||||||
|
Operating
expenses per available seat mile (cents)
|
16.60 | 11.76 | ||||||
|
Less: Fuel expense per available seat mile (cents)
|
5.39 | 3.57 | ||||||
|
Less: Impact of special items (cents)
|
2.59 | - | ||||||
|
Operating expenses per available seat mile, excluding fuel expense and
impact of special items (cents)
|
8.62 | 8.19 | ||||||
|
Percent change
|
5.3 | % | ||||||
|
AMR
Corporation
|
Three
Months Ended June 30,
|
|||||||
|
(in
millions, except as noted)
|
2008
|
2007
|
||||||
|
Net
Income/(Loss)
|
(1,448 | ) | 317 | |||||
|
Less: Impact of special items
|
(1,164 | ) | - | |||||
|
Net Income/(Loss), excluding impact of special items
|
(284 | ) | 317 | |||||
|
Earnings/(Loss)
Per Share
|
||||||||
|
Basic
|
(1.13 | ) | 1.28 | |||||
|
Diluted
|
(1.13 | ) | 1.08 | |||||
AMR
CORPORATION
NON-GAAP
AND OTHER RECONCILIATIONS
(Unaudited)
|
AMR
Corporation
|
||||||||
|
Reclassification
of AAdvantage Mileage Third-Party Sales Revenue
|
||||||||
|
Three
Months Ended March 31, 2007
|
||||||||
|
(in
millions, except as noted)
|
As
Reported
|
Reclassified
|
||||||
|
Passenger
revenue - American Airlines
|
$ | 4,326 | $ | 4,176 | ||||
|
Other
revenues
|
342 | 492 | ||||||
|
Total
|
$ | 4,668 | $ | 4,668 | ||||
|
Available
seat miles
|
41,691 | 41,691 | ||||||
|
Passenger
revenue per available seat mile (cents)
|
10.38 | 10.02 | ||||||
|
Three
Months Ended June 30, 2007
|
||||||||
|
(in
millions, except as noted)
|
As
Reported
|
Reclassified
|
||||||
|
Passenger
revenue - American Airlines
|
$ | 4,673 | $ | 4,525 | ||||
|
Other
revenues
|
348 | 496 | ||||||
|
Total
|
$ | 5,021 | $ | 5,021 | ||||
|
Available
seat miles
|
42,647 | 42,647 | ||||||
|
Passenger
revenue per available seat mile (cents)
|
10.96 | 10.61 | ||||||
|
Three
Months Ended September 30, 2007
|
||||||||
|
(in
millions, except as noted)
|
As
Reported
|
Reclassified
|
||||||
|
Passenger
revenue - American Airlines
|
$ | 4,750 | $ | 4,598 | ||||
|
Other
revenues
|
352 | 504 | ||||||
|
Total
|
$ | 5,102 | $ | 5,102 | ||||
|
Available
seat miles
|
43,271 | 43,271 | ||||||
|
Passenger
revenue per available seat mile (cents)
|
10.98 | 10.63 | ||||||
|
Three
Months Ended December 31, 2007
|
||||||||
|
(in
millions, except as noted)
|
As
Reported
|
Reclassified
|
||||||
|
Passenger
revenue - American Airlines
|
$ | 4,486 | $ | 4,352 | ||||
|
Other
revenues
|
363 | 497 | ||||||
|
Total
|
$ | 4,849 | $ | 4,849 | ||||
|
Available
seat miles
|
42,297 | 42,297 | ||||||
|
Passenger
revenue per available seat mile (cents)
|
10.61 | 10.29 | ||||||
AMR
CORPORATION
CONSOLIDATED
STATEMENTS OF OPERATIONS
(in
millions, except per share amounts)
(Unaudited)
|
Six
Months Ended June 30,
|
Percent
|
|||||||||||
|
2008
|
2007
|
Change
|
||||||||||
|
Revenues
|
||||||||||||
|
Passenger
- American Airlines
|
$ | 9,114 | $ | 8,701 | 4.7 | |||||||
|
-
Regional Affiliates
|
1,264 | 1,216 | 3.9 | |||||||||
|
Cargo
|
448 | 401 | 11.7 | |||||||||
|
Other
revenues
|
1,050 | 988 | 6.3 | |||||||||
|
Total
operating revenues
|
11,876 | 11,306 | 5.0 | |||||||||
|
Expenses
|
||||||||||||
|
Aircraft
fuel
|
4,473 | 3,054 | 46.5 | |||||||||
|
Wages,
salaries and benefits
|
3,302 | 3,326 | (0.7 | ) | ||||||||
|
Other
rentals and landing fees
|
641 | 642 | (0.2 | ) | ||||||||
|
Depreciation
and amortization
|
633 | 585 | 8.2 | |||||||||
|
Commissions,
booking fees and credit card expense
|
516 | 517 | (0.2 | ) | ||||||||
|
Maintenance,
materials and repairs
|
638 | 516 | 23.6 | |||||||||
|
Aircraft
rentals
|
250 | 303 | (17.5 | ) | ||||||||
|
Food
service
|
260 | 260 | - | |||||||||
|
Special
charges
|
1,164 | - | * | |||||||||
|
Other
operating expenses
|
1,476 | 1,388 | 6.3 | |||||||||
|
Total
operating expenses
|
13,353 | 10,591 | 26.1 | |||||||||
|
Operating
Income
|
(1,477 | ) | 715 | * | ||||||||
|
Other
Income (Expense)
|
||||||||||||
|
Interest
income
|
101 | 167 | (39.5 | ) | ||||||||
|
Interest
expense
|
(379 | ) | (476 | ) | (20.4 | ) | ||||||
|
Interest
capitalized
|
13 | 14 | (7.1 | ) | ||||||||
|
Miscellaneous
– net
|
(34 | ) | (22 | ) | 54.5 | |||||||
| (299 | ) | (317 | ) | (5.7 | ) | |||||||
|
Income
Before Income Taxes
|
(1,776 | ) | 398 | * | ||||||||
|
Income
tax
|
- | - | - | |||||||||
|
Net
Income
|
$ | (1,776 | ) | $ | 398 | * | ||||||
|
Earnings
Per Share
|
||||||||
|
Basic
|
$ | (7.10 | ) | $ | 1.65 | |||
|
Diluted
|
$ | (7.10 | ) | $ | 1.38 | |||
|
Number
of Shares Used in Computation
|
||||||||
|
Basic
|
250 | 241 | ||||||
|
Diluted
|
250 | 299 | ||||||
|
|
*
|
Greater
than 100%
|
AMR
CORPORATION
OPERATING
STATISTICS
(Unaudited)
|
Six
Months Ended
June
30,
|
Percent
|
|||||||||||
|
2008
|
2007
|
Change
|
||||||||||
|
American
Airlines, Inc. Mainline Jet Operations
|
||||||||||||
|
Revenue
passenger miles (millions)
|
66,887 | 68,244 | (2.0 | ) | ||||||||
|
Available
seat miles (millions)
|
82,770 | 84,338 | (1.9 | ) | ||||||||
|
Cargo
ton miles (millions)
|
1,038 | 1,060 | (2.1 | ) | ||||||||
|
Passenger
load factor
|
80.8 | % | 80.9 | % |
(0.1)
|
pts | ||||||
|
Passenger
revenue yield per passenger mile (cents)
|
13.63 | 12.75 | 6.9 | |||||||||
|
Passenger
revenue per available seat mile (cents)
|
11.01 | 10.32 | 6.7 | |||||||||
|
Cargo
revenue yield per ton mile (cents)
|
43.17 | 37.80 | 14.2 | |||||||||
|
Operating expenses per available seat mile, excluding Regional Affiliates
(cents) (1)
|
14.23 | 11.03 | 29.0 | |||||||||
|
Fuel
consumption (gallons, in millions)
|
1,368 | 1,405 | (2.6 | ) | ||||||||
|
Fuel
price per gallon (cents)
|
295.4 | 196.0 | 50.7 | |||||||||
|
Regional
Affiliates
|
||||||||||||
|
Revenue
passenger miles (millions)
|
4,542 | 4,857 | (6.5 | ) | ||||||||
|
Available
seat miles (millions)
|
6,380 | 6,654 | (4.1 | ) | ||||||||
|
Passenger
load factor
|
71.2 | % | 73.0 | % |
(1.8)
|
pts | ||||||
|
(1)
|
Excludes
$1.6 billion and $1.4 billion of expense incurred related to Regional
Affiliates in 2008 and 2007,
respectively.
|
AMR
CORPORATION
OPERATING
STATISTICS
(Unaudited)
OPERATING
STATISTICS BY REGIONAL ENTITY
|
American
Airlines, Inc.
|
Six
Months Ended June 30, 2008
|
|||||||||||||||
|
Entity
Results
|
RASM1
(cents)
|
Y-O-Y
Change
|
ASMs2
(billions)
|
Y-O-Y
Change
|
||||||||||||
|
DOT
Domestic
|
10.91 | 6.4 | % | 52.0 | (3.6 | )% | ||||||||||
|
International
|
11.19 | 7.2 | 30.8 | 1.2 | ||||||||||||
|
DOT
Latin America
|
11.91 | 9.1 | 15.5 | 3.2 | ||||||||||||
|
DOT
Atlantic
|
10.44 | 3.1 | 12.0 | (0.5 | ) | |||||||||||
|
DOT
Pacific
|
10.51 | 11.9 | 3.3 | (1.6 | ) | |||||||||||
1 Revenue
per Available Seat Mile
2
Available Seat Miles
|
American
Airlines, Inc.
|
Six
Months Ended June 30, 2008
|
|||||||||||||||
|
Entity
Results
|
Load
Factor
(pts)
|
Y-O-Y
Change
(pts)
|
Yield
(cents)
|
Y-O-Y
Change
|
||||||||||||
|
DOT
Domestic
|
82.3 | (0.6 | ) | 13.26 | 7.2 | % | ||||||||||
|
International
|
78.3 | 0.8 | 14.28 | 6.0 | ||||||||||||
|
DOT
Latin America
|
77.8 | 2.0 | 15.31 | 6.2 | ||||||||||||
|
DOT
Atlantic
|
77.7 | (0.4 | ) | 13.42 | 3.6 | |||||||||||
|
DOT
Pacific
|
83.0 | 0.1 | 12.66 | 11.7 | ||||||||||||
AMR
CORPORATION
NON-GAAP
AND OTHER RECONCILIATIONS
(Unaudited)
|
American
Airlines, Inc. Mainline Jet Operations
|
Six
Months Ended June 30,
|
|||||||
|
(in
millions, except as noted)
|
2008
|
2007
|
||||||
|
Total
operating expenses
|
$ | 13,400 | $ | 10,678 | ||||
|
Less: Operating expenses incurred related to Regional
Affiliates
|
1,625 | 1,378 | ||||||
|
Operating expenses excluding expenses incurred related to Regional
Affiliates
|
$ | 11,775 | $ | 9,300 | ||||
|
American
mainline jet operations available seat miles
|
82,770 | 84,338 | ||||||
|
Operating expenses per available seat mile, excluding Regional Affiliates
(cents)
|
14.23 | 11.03 | ||||||
|
Percent change
|
29.0 | % | ||||||
|
American
Airlines, Inc. Mainline Jet Operations
|
Six
Months Ended June 30,
|
|||||||
|
(in
millions, except as noted)
|
2008
|
2007
|
||||||
|
Total
operating expenses
|
$ | 13,400 | $ | 10,678 | ||||
|
Less: Operating expenses incurred related to Regional
Affiliates
|
1,625 | 1,378 | ||||||
|
Operating expenses excluding expenses incurred related to Regional
Affiliates
|
$ | 11,775 | $ | 9,300 | ||||
|
American
mainline jet operations available seat miles
|
82,770 | 84,338 | ||||||
|
Operating expenses per available seat mile, excluding Regional Affiliates
(cents)
|
14.23 | 11.03 | ||||||
|
Less: Impact of special items (cents)
|
1.27 | - | ||||||
|
Operating expenses per available seat mile, excluding impact of special
items (cents)
|
12.96 | 11.03 | ||||||
|
Percent change
|
17.5 | % | ||||||
AMR
CORPORATION
NON-GAAP
AND OTHER RECONCILIATIONS
(Unaudited)
|
American
Airlines, Inc. Mainline Jet Operations
|
Six
Months Ended June 30,
|
|||||||
|
(in
millions, except as noted)
|
2008
|
2007
|
||||||
|
Total
operating expenses
|
$ | 13,400 | $ | 10,678 | ||||
|
Less: Operating expenses incurred related to Regional
Affiliates
|
1,625 | 1,378 | ||||||
|
Operating expenses excluding expenses incurred related to Regional
Affiliates
|
$ | 11,775 | $ | 9,300 | ||||
|
American
mainline jet operations available seat miles
|
82,770 | 84,338 | ||||||
|
Operating expenses per available seat mile, excluding Regional Affiliates
(cents)
|
14.23 | 11.03 | ||||||
|
Less: Fuel cost per available seat mile (cents)
|
4.88 | 3.27 | ||||||
|
Less: Impact of special items (cents)
|
1.27 | |||||||
|
Operating expenses per available seat mile, excluding impact of special
items and the cost of fuel (cents)
|
8.08 | 7.76 | ||||||
|
Percent change
|
4.1 | % | ||||||
|
AMR
Corporation
|
Six
Months Ended June 30,
|
|||||||
|
(in
millions, except as noted)
|
2008
|
2007
|
||||||
|
Operating
expenses per available seat mile (cents)
|
14.98 | 11.64 | ||||||
|
Less: Impact of special items (cents)
|
1.31 | - | ||||||
|
Operating expenses per available seat mile, excluding impact of special
items (cents)
|
13.67 | 11.64 | ||||||
|
Percent change
|
17.4 | % | ||||||
|
AMR
Corporation
|
Six
Months Ended June 30,
|
|||||||
|
(in
millions, except as noted)
|
2008
|
2007
|
||||||
|
Operating
expenses per available seat mile (cents)
|
14.98 | 11.64 | ||||||
|
Less: Fuel expense per available seat mile (cents)
|
5.02 | 3.36 | ||||||
|
Less: Impact of special items (cents)
|
1.31 | - | ||||||
|
Operating expenses per available seat mile, excluding fuel expense and
impact of special items (cents)
|
8.65 | 8.28 | ||||||
|
Percent change
|
4.5 | % | ||||||
Current
AMR Corp. news releases can be accessed on the Internet.
The
address is: http://www.aa.com
###