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October 17, 2012

AMR posts $238 million third-quarter loss

AMR Corp., reported a third-quarter loss of $238 million as the parent company of American Airlines paid millions in employee-related severance costs.

The loss was larger than the $162 million loss AMR posted in the third quarter of 2011. Revenues at the carrier grew 0.8 percent to $6.4 billion.

Although AMR had thousands of flight cancellations and delays in the last two weeks of the quarter, the company said the impact of the operational disruption was "not material" to its third-quarter financial results.

Excluding one-time accounting charges that totaled $348 million, AMR would have posted a net profit of $110 million. The carrier said $211 million in special charges is related to employee severance costs and another $137 million were reorganization items made in bankruptcy, such as refinancing aircraft and paying professional fees to consultants.

"I want to thank my American colleagues for their efforts in delivering another profitable quarter, excluding reorganization and special items," said AMR chief executive Tom Horton in a statement. "These results were driven by the best unit revenue growth in the industry in each month of the quarter, and by record load factor, as we continue to make progress in our restructuring for a successful future."

AMR said that average fares paid by customers increased 3.5 percent compared to the previous third quarter. The company cut American Airlines' capacity by 2.5 percent which resulted in AMR posting a record high consolidated load factor of 84.7 percent. AMR said it expects fourth-quarter capacity to be up less than half of a percent compared to the fourth quarter of 2011.

The company said it ended the third quarter with $4.2 billion in cash not including a restricted cash balance of $847 million.

American also announced on Wednesday that it plans to hire 1,500 new flight attendants over the next year. The carrier needed to add more flight crew members as over 2,200 current flight attendants offered to take the company's voluntary early-out offer.

-Andrea Ahles

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Comments

RL

I just read above this article that Tom Horton said American Airlines is making great progress - Did I miss something?

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