Thursday April 21, 2005
Hammered by high fuel prices, AMR Corp., parent of American Airlines, reported a $162 million net loss for the first quarter ended March 31, which included a tax credit of $69 million.Excluding the credit, the company would have posted a net loss of $230 million. This compares to a net loss of $166 million in the 2004 first quarter. "In many ways, the story for the first quarter is very similar to what we have seen the past several quarters," Chairman and CEO Gerard Arpey said. "The combination of extraordinarily high fuel prices and low fares continues to take a heavy financial toll."
Total operating revenues rose 5.3% to $4.75 billion and operating expenses climbed 5.7% to $4.73 billion. Excluding the tax credit, Arpey said the company paid $346 million more for fuel in the quarter than it did in the year-ago period, and based on current estimates it expects the full-year impact of fuel prices to exceed $1.3 billion. As a result, operating income during the quarter totaled $23 million, down 45.2% from operating income of $42 million in the prior-year period.
Mainline passenger yield declined 2.1% to 11.88 cents on a 6.7% increase in traffic, while passenger RASM climbed 3.7% to 8.96 cents on a 4.3-point gain in load factor. Arpey said the increase in RASM was driven by strong load factors and a number of network adjustments that AA has implemented in recent months, including a reduction in overall domestic capacity and the addition of new international routes. Operating CASM, excluding Regional affiliates, increased 3.3% to 9.80 cents but fell 3.2% on a fuel-neutral basis with the tax credit excluded.
Looking ahead, Arpey said AMR clearly still has a lot of work to do. "Despite fuel and despite fares, however, we are making progress," he said.
by Loren Farrar
ATW-Online
Comment: I wonder how much bigger would have been the loss, if AA would not have a monopoly to the DR. Also I ask myself how much longer can legacy airlines in the US operate without making money?
Hammered by high fuel prices, AMR Corp., parent of American Airlines, reported a $162 million net loss for the first quarter ended March 31, which included a tax credit of $69 million.Excluding the credit, the company would have posted a net loss of $230 million. This compares to a net loss of $166 million in the 2004 first quarter. "In many ways, the story for the first quarter is very similar to what we have seen the past several quarters," Chairman and CEO Gerard Arpey said. "The combination of extraordinarily high fuel prices and low fares continues to take a heavy financial toll."
Total operating revenues rose 5.3% to $4.75 billion and operating expenses climbed 5.7% to $4.73 billion. Excluding the tax credit, Arpey said the company paid $346 million more for fuel in the quarter than it did in the year-ago period, and based on current estimates it expects the full-year impact of fuel prices to exceed $1.3 billion. As a result, operating income during the quarter totaled $23 million, down 45.2% from operating income of $42 million in the prior-year period.
Mainline passenger yield declined 2.1% to 11.88 cents on a 6.7% increase in traffic, while passenger RASM climbed 3.7% to 8.96 cents on a 4.3-point gain in load factor. Arpey said the increase in RASM was driven by strong load factors and a number of network adjustments that AA has implemented in recent months, including a reduction in overall domestic capacity and the addition of new international routes. Operating CASM, excluding Regional affiliates, increased 3.3% to 9.80 cents but fell 3.2% on a fuel-neutral basis with the tax credit excluded.
Looking ahead, Arpey said AMR clearly still has a lot of work to do. "Despite fuel and despite fares, however, we are making progress," he said.
by Loren Farrar
ATW-Online
Comment: I wonder how much bigger would have been the loss, if AA would not have a monopoly to the DR. Also I ask myself how much longer can legacy airlines in the US operate without making money?