AA Updates Shareholders on Distribution Issues

AMR Corporation, the parent company of American Airlines, offered its shareholders an update on controversial distribution issues as part of its annual financial report.

American said it is currently in "business discussions with Expedia and Orbitz, two online travel agencies, and in litigation with Travelport and Sabre, Global Distribution Systems (GDS) that provide American's and other airlines' fare and schedule information to its travel agency subscribers."

"The Company's goal is to have broad cost-efficient distribution channels, offer good fares to customers, and provide extensive choices of products and services. While American continues to take steps to resolve these matters, American Airlines fares and schedules – including all international and domestic classes of service – continue to be widely available through a number of outlets, including American's own website, AA.com, American's reservations agents, thousands of travel agencies in locations worldwide, online travel agencies such as Priceline.com, and search engines such as Kayak.com,” AMR said.

On the financial front, AMR reported a net loss of $97 million for the fourth quarter of 2010. The fourth quarter 2010 results include the impact of approximately $28 million in a non-cash impairment charge to write down certain route authorities in Colombia as a result of a recent open skies agreement, AA said. Excluding this special item, AA said it lost $69 million. Results include a $35 million tax benefit primarily related to The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 passed in late December.

The results for the fourth quarter of 2010 compare to a loss of $344 million for the fourth quarter of 2009. The fourth quarter 2009 results include the positive net impact of $71 million in non-cash special items and a non-cash tax item. Excluding these special items and the non-cash tax item, the company lost $415 million in the fourth quarter of 2009.

For all of 2010, AMR recorded a net loss of $471 million compared to a loss of $1.5 billion for 2009. Excluding special items and non-cash tax items, the Company lost $389 million in 2010, compared to a loss of $1.4 billion in 2009.

2010 has been a year of significant improvement for American Airlines, said Gerard Arpey, AMR's CEO. "It was a year of major progress, as we have implemented both our domestic cornerstone strategy and our joint trans-Atlantic business with British Airways and Iberia – and we look forward to launching a similar joint business with Japan Airlines across the Pacific in April of this year."

Arpey added, "We have set the stage for success – and our efforts are starting to produce meaningful results. In 2011, American will continue to enhance its own network and expand its relationship with quality carriers in the markets that are important to our customers. American is well positioned to capitalize on the opportunities unfolding in the marketplace. While the road forward is not without challenges, as we begin 2011, we are enthusiastic about the possibilities we see ahead."

AA also reported an agreement with Boeing to acquire two Boeing 777-300ER Widebody aircraft. The two aircraft are expected to be delivered in late 2012.

Visit www.AA.com.


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