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AMR Reports Second Quarter Results, Promotes Two Executives

July 21, 2010 By: George Dooley

AMR Corporation, the parent company of American Airlines, reported a net loss of $10.7 million for the second quarter of 2010 compared to a net loss of $390 million in the second quarter of 2009. Capitalizing on the momentum from the granting of antitrust immunity across the Atlantic, and anticipating similar immunity across the Pacific, AMR also announced a reorganization of its senior management team. In addition, the company announced an order for 35 additional Boeing 737-800s to be delivered in 2011 and 2012.

Including the impact of fuel hedging, AMR paid nearly $334 million more for jet fuel in the second quarter, at an average of $2.37 per gallon, than it would have paid at prices prevailing during the second quarter of 2009, when it paid $1.90 per gallon, AMR said. AA’s second quarter consolidated revenues were approximately $5.7 billion, an increase of 16.0 percent year over year.

These results include the impact of significantly higher fuel prices compared to the year-ago quarter. The second quarter 2009 results included the impact of approximately $70 million in non-recurring charges related to the sale of certain aircraft and the grounding of leased Airbus A300 aircraft prior to lease expiration. Excluding those non-recurring charges, the second quarter 2009 loss was $319 million.

AMR Chairman and CEO Gerard Arpey noted substantial progress improving the company's financial performance comparatively, both year-over-year and in sequential quarters. "As we move forward, we remain focused on our primary goals of driving revenue growth, controlling costs, and returning to sustained profitability," said Arpey. "Our plan to achieve these objectives is distinguished by our cornerstone network strategy, the ongoing implementation of our planned joint business agreements in the transatlantic and transpacific markets, additional alliance and network activities, and our ongoing fleet renewal efforts. Taken together, these initiatives are designed to grow revenue, fortify our network, and control our unit costs – all central elements of our Flight Plan 2020. We believe our plan, and these initiatives, are paving the way to a more successful and competitive company."

Tom Horton, previously executive vice president finance and planning and Chief Financial Officer, has been promoted to president of AMR and American Airlines and will continue to report directly to Arpey. With his expanded responsibilities, Horton will oversee the finance, planning, sales and marketing, customer service and information technology organizations. As part of these changes, Bella Goren will assume the role of senior vice president and CFO. Goren, formerly senior vice president of customer relationship marketing, will report to Horton.

Earlier this week American announced it will expand its partnership with JetBlue Airways in the coming months, so that members of American’s AAdvantage program and JetBlue’s TrueBlue customer loyalty program will be able to earn AAdvantage miles or TrueBlue points, respectively, when they fly only on American and JetBlue cooperative interline routes.



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