American Airlines Reports Third-Quarter 2020 Financial Results
October 22 2020 - 7:00AM
American Airlines Group Inc. (NASDAQ: AAL) today reported its
third-quarter 2020 financial results, including:
- Third-quarter revenue of
$3.2 billion, down 73%
year-over-year on a 59% year-over-year reduction in total
available seat miles (ASMs).
- Third-quarter pretax loss of
$3.1 billion. Excluding net
special items1,
third-quarter pretax loss of
$3.6 billion.
- Third-quarter net loss of
$2.4 billion, or
($4.71) per share. Excluding net
special items1,
third-quarter net loss of
$2.8 billion, or
($5.54) per share.
- Ended third quarter with approximately $13.6 billion of
total available liquidity. In addition, in October, the company
increased its loan capacity by $2 billion through the CARES Act
loan program to $7.5 billion. With this
increase, the company’s
third-quarter pro forma liquidity balance is
approximately $15.6
billion.
- Announced authorization to issue up to
$1 billion of equity in an at-the-market
offering to further bolster
liquidity.
“During the third quarter, we took action to reduce our costs,
strengthen our financial position, and ensure our customers return
to travel with confidence,” said American Airlines Chairman and CEO
Doug Parker. “The American Airlines team is doing a remarkable job
taking care of our customers and each other during the most
challenging time in our industry’s history.
“We have a long road ahead and our team remains fully engaged
and focused not just on managing through the pandemic, but on
making sure we are prepared for when demand returns. We are
confident that the continued efforts of our team and the actions we
have taken will drive customer confidence and strengthen our
company for the future.”
Supporting team members, customers and
communitiesTo ensure the safety and well-being of its team
members and customers, American:
- Upgraded its Clean Commitment by adding the electrostatic
spraying solution SurfaceWise®2 to its cleaning and safety program.
SurfaceWise2 is approved by the EPA as the first-ever long-lasting
product to help fight the spread of the novel coronavirus and it
will be applied to American’s entire fleet in the coming
months.
- Announced a preflight COVID-19 testing program to help reopen
markets to travel. Testing options are now available to customers
traveling to Hawaii and Costa Rica, with Jamaica and the Bahamas
soon to follow.
- Launched a new travel tool to help customers quickly see the
current COVID-19 travel guidelines for domestic and international
destinations.
- Continues to work with the Global Biorisk Advisory Council for
GBAC STAR® Accreditation for its aircraft and lounges. American is
the first airline to seek the accreditation and expects to receive
the designation by the end of 2020.
To provide its customers additional flexibility, American:
- Eliminated change fees for most domestic and short-haul
international flying. American will also allow customers to keep
the full value of their original tickets if they change their plans
prior to scheduled travel.
- Is giving customers the option to stand by on flights on the
same day at no charge.
- Enhanced its Basic Economy product to give customers the
ability to tailor their travel experience, including upgrades,
Preferred and Main Cabin Extra seats, priority boarding, and
same-day flight changes.
- Is allowing AAdvantage® elite members to apply their current
travel benefits when purchasing a Basic Economy fare.
- Reopened additional Admirals Club lounges with enhanced
cleaning and safety protocols as customers begin planning holiday
travel.
To support the communities it serves, American:
- More than doubled its cargo-only flying from August to
September and operated more than 1,900 flights serving 32
destinations during the third quarter. To date, these cargo flights
have helped the airline’s customers move more than 85 million
pounds of critical goods around the world amidst the COVID-19
outbreak. Through these efforts, the company’s cargo revenue was
$207 million in the third quarter, effectively flat year-over-year
on a 59% reduction in total ASMs.
- Donated more than 1 million pounds of food to fight hunger in
communities around the world since the start of the pandemic.
Through its partnership with Feeding America®, and other charitable
organizations, American has contributed its surplus food to help
provide meals to families in need throughout the U.S., Europe, Asia
and Latin America.
Conserving cashAmerican continues to take
aggressive action to reduce costs and preserve cash. The airline
estimates that it has removed approximately $17 billion from its
operating and capital budgets for 2020. This has been achieved
primarily through cost savings resulting from reduced flying. The
company also:
- Removed more than 150 aircraft from its fleet through early
retirements or by placing aircraft into temporary storage. In
addition to the previously announced retirements of the Boeing 757,
Boeing 767, Embraer E190, Airbus A330-300, Bombardier CRJ-200 and
certain other regional aircraft, the company recently decided to
permanently retire all 15 of its Airbus A330-200 aircraft.
- Reached an agreement with Boeing to secure rights to defer
deliveries of 18 737 MAX aircraft scheduled to be delivered in 2021
and 2022 to 2023 and 2024. The company also finalized a series of
sale-leaseback transactions to finance its remaining Airbus A321
aircraft deliveries in 2021. As a result, the company now has
financing secured for all of its planned deliveries through
2021.
- Made the difficult decision to proceed with furloughs to reduce
headcount absent an extension of the CARES Act Payroll Support
Program (PSP). In total, more than 20,000 team members have opted
for an early out or long-term leave, and 19,000 team members were
furloughed beginning Oct. 1. The company, along with its union
partners, continues to aggressively fight for an extension of the
PSP that would allow the airline to bring back those furloughed
employees and reinstate service to small- and medium-sized markets
that have suffered without the extension of funds.
- Reduced its non-aircraft capital expense — by $700 million in
2020 and another $300 million in 2021 — through reductions in fleet
modification work, the elimination of all new ground service
equipment purchases, and pausing all noncritical facility
investments and IT projects.
Bolstering liquidityIn addition to reducing its
operating and capital expenditures, American continues to
strengthen its liquidity position. The company:
- Finalized a $5.5 billion loan agreement with the U.S.
Department of the Treasury through the CARES Act loan program. In
October, the company increased its loan capacity through the
program to $7.5 billion.
- Closed $1.2 billion of financing with Goldman Sachs Merchant
Bank through two senior secured note transactions. American does
not have any large non-aircraft debt maturities until its $750
million unsecured bonds mature in June 2022.
- Received the final payments of allotted PSP funds, including an
incremental $168 million of previously unallocated funds identified
by the Treasury Department.
- Announced authorization to issue up to $1 billion of equity in
an at-the-market offering to further bolster liquidity.
- Reduced its daily cash burn rate2 to approximately $44 million
per day in the third quarter from approximately $58 million per day
in the second quarter. The company presently expects its
fourth-quarter cash burn rate to be approximately $25 to $30
million per day.
- The company’s third-quarter pro forma liquidity balance is
approximately $15.6 billion and it expects to end the fourth
quarter with more than $13 billion in total available liquidity,
which excludes any proceeds from the $1 billion at-the-market
equity offering.
Demand and capacity outlook American saw
improvements in passenger demand and load factors during the third
quarter, but both continue to be significantly below 2019 levels.
The company will continue to match its forward capacity with
observed bookings trends and currently expects its fourth-quarter
system capacity to be down more than 50% year over year, with
long-haul international capacity down approximately 75% year over
year.
Conference call and webcast detailsThe
company will conduct a live audio webcast of its financial
results call at 7:30 a.m. CDT today. The call will be
available to the public on a listen-only basis at
aa.com/investorrelations. An archive of the webcast will be
available on the website through Nov. 22.
NotesSee the accompanying notes in the
Financial Tables section of this press release for further
explanation, including a reconciliation of all GAAP to non-GAAP
financial information.
- The company recognized $519 million of operating net special
items during the third quarter 2020. Mainline operating special
items, net principally included $1.9 billion of Payroll Support
Program (PSP) financial assistance, offset in part by $871 million
of salary and medical costs associated with certain team members
who opted in to voluntary early retirement programs or who were
involuntarily furloughed starting Oct. 1, 2020, as a result of
reductions to the company's operation due to COVID-19 and $742
million of fleet impairment charges. Regional operating special
items, net totaled $224 million and principally includes the PSP
financial assistance.Third quarter 2020 nonoperating special items,
net totaled $21 million and principally included net unrealized
gains associated with certain equity investments.
- A reconciliation of this calculation can be found in the tables
that follow.
About American Airlines GroupAmerican’s purpose
is to care for people on life’s journey. Shares of American
Airlines Group Inc. trade on Nasdaq under the ticker symbol AAL and
the company’s stock is included in the S&P 500. Learn more
about what’s happening at American by visiting news.aa.com and
connect with American on Twitter @AmericanAir and at
Facebook.com/AmericanAirlines.
Cautionary Statement Regarding Forward-Looking
Statements and InformationCertain of the statements
contained in this report should be considered forward-looking
statements within the meaning of the Securities Act of 1933, as
amended (the Securities Act), the Securities Exchange Act of 1934,
as amended (the Exchange Act), and the Private Securities
Litigation Reform Act of 1995. These forward-looking statements may
be identified by words such as “may,” “will,” “expect,” “intend,”
“anticipate,” “believe,” “estimate,” “plan,” “project,” “could,”
“should,” “would,” “continue,” “seek,” “target,” “guidance,”
“outlook,” “if current trends continue,” “optimistic,” “forecast”
and other similar words. Such statements include, but are not
limited to, statements about the company’s plans, objectives,
expectations, intentions, estimates and strategies for the future,
and other statements that are not historical facts. These
forward-looking statements are based on the company’s current
objectives, beliefs and expectations, and they are subject to
significant risks and uncertainties that may cause actual results
and financial position and timing of certain events to differ
materially from the information in the forward-looking statements.
These risks and uncertainties include, but are not limited to,
those set forth in the company’s Quarterly Report on Form 10-Q for
the quarter ended September 30, 2020 (especially in Part I, Item 2.
Management’s Discussion and Analysis of Financial Condition and
Results of Operations, and Part II, Item 1A. Risk Factors), and
other risks and uncertainties listed from time to time in the
company’s other filings with the Securities and Exchange
Commission. There may be other factors of which the company is not
currently aware that may affect matters discussed in the
forward-looking statements and may also cause actual results to
differ materially from those discussed. In particular, the
consequences of the COVID-19 outbreak to economic conditions and
the travel industry in general and the financial position and
operating results of the company in particular have been material,
are changing rapidly, and cannot be predicted. The company does not
assume any obligation to publicly update or supplement any
forward-looking statement to reflect actual results, changes in
assumptions or changes in other factors affecting these
forward-looking statements other than as required by
law. Forward looking statements speak only as of the date
hereof or as of the dates indicated in the statement.
Corporate
Communicationsmediarelations@aa.com
Investor
Relationsinvestor.relations@aa.com
American
Airlines Group Inc. |
Condensed
Consolidated Statements of Operations |
(In
millions, except share and per share amounts) |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3 Months Ended
September 30, |
|
Percent |
|
9 Months Ended
September 30, |
|
Percent |
|
|
|
2020 |
|
|
|
2019 |
|
|
Change |
|
|
2020 |
|
|
|
2019 |
|
|
Change |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
Passenger |
|
$ |
2,540 |
|
|
$ |
10,995 |
|
|
(76.9 |
) |
|
$ |
11,328 |
|
|
$ |
31,663 |
|
|
(64.2 |
) |
Cargo |
|
|
207 |
|
|
|
208 |
|
|
(0.4 |
) |
|
|
484 |
|
|
|
647 |
|
|
(25.1 |
) |
Other |
|
|
426 |
|
|
|
708 |
|
|
(39.9 |
) |
|
|
1,497 |
|
|
|
2,145 |
|
|
(30.2 |
) |
Total operating revenues |
|
|
3,173 |
|
|
|
11,911 |
|
|
(73.4 |
) |
|
|
13,309 |
|
|
|
34,455 |
|
|
(61.4 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Aircraft fuel and related taxes |
|
|
453 |
|
|
|
1,989 |
|
|
(77.2 |
) |
|
|
2,065 |
|
|
|
5,710 |
|
|
(63.8 |
) |
Salaries, wages and benefits |
|
|
2,705 |
|
|
|
3,219 |
|
|
(16.0 |
) |
|
|
8,384 |
|
|
|
9,509 |
|
|
(11.8 |
) |
Regional expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Fuel |
|
|
158 |
|
|
|
485 |
|
|
(67.4 |
) |
|
|
638 |
|
|
|
1,395 |
|
|
(54.2 |
) |
Depreciation and amortization |
|
|
79 |
|
|
|
84 |
|
|
(6.4 |
) |
|
|
247 |
|
|
|
246 |
|
|
0.3 |
|
Other |
|
|
677 |
|
|
|
1,364 |
|
|
(50.3 |
) |
|
|
2,753 |
|
|
|
3,941 |
|
|
(30.1 |
) |
Maintenance, materials and repairs |
|
|
337 |
|
|
|
610 |
|
|
(44.7 |
) |
|
|
1,253 |
|
|
|
1,745 |
|
|
(28.2 |
) |
Other rent and landing fees |
|
|
367 |
|
|
|
530 |
|
|
(30.8 |
) |
|
|
1,149 |
|
|
|
1,568 |
|
|
(26.7 |
) |
Aircraft rent |
|
|
336 |
|
|
|
335 |
|
|
0.2 |
|
|
|
1,004 |
|
|
|
996 |
|
|
0.8 |
|
Selling expenses |
|
|
70 |
|
|
|
424 |
|
|
(83.5 |
) |
|
|
418 |
|
|
|
1,194 |
|
|
(65.0 |
) |
Depreciation and amortization |
|
|
498 |
|
|
|
499 |
|
|
(0.3 |
) |
|
|
1,557 |
|
|
|
1,469 |
|
|
6.0 |
|
Special items, net |
|
|
(295 |
) |
|
|
228 |
|
|
nm |
|
(1) |
|
(657 |
) |
|
|
487 |
|
|
nm |
|
Other |
|
|
659 |
|
|
|
1,336 |
|
|
(50.7 |
) |
|
|
2,404 |
|
|
|
3,859 |
|
|
(37.7 |
) |
Total operating expenses |
|
|
6,044 |
|
|
|
11,103 |
|
|
(45.6 |
) |
|
|
21,215 |
|
|
|
32,119 |
|
|
(33.9 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss) |
|
|
(2,871 |
) |
|
|
808 |
|
|
nm |
|
|
|
(7,906 |
) |
|
|
2,336 |
|
|
nm |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonoperating
income (expense): |
|
|
|
|
|
|
|
|
|
|
|
|
Interest income |
|
|
5 |
|
|
|
34 |
|
|
(84.9 |
) |
|
|
36 |
|
|
|
103 |
|
|
(64.9 |
) |
Interest expense, net |
|
|
(340 |
) |
|
|
(284 |
) |
|
19.6 |
|
|
|
(851 |
) |
|
|
(830 |
) |
|
2.6 |
|
Other income (expense), net |
|
|
111 |
|
|
|
(1 |
) |
|
nm |
|
|
|
77 |
|
|
|
76 |
|
|
1.2 |
|
Total nonoperating expense, net |
|
|
(224 |
) |
|
|
(251 |
) |
|
(10.8 |
) |
|
|
(738 |
) |
|
|
(651 |
) |
|
13.4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income
(loss) before income taxes |
|
|
(3,095 |
) |
|
|
557 |
|
|
nm |
|
|
|
(8,644 |
) |
|
|
1,685 |
|
|
nm |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
provision (benefit) |
|
|
(696 |
) |
|
|
132 |
|
|
nm |
|
|
|
(1,937 |
) |
|
|
413 |
|
|
nm |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
(2,399 |
) |
|
$ |
425 |
|
|
nm |
|
|
$ |
(6,707 |
) |
|
$ |
1,272 |
|
|
nm |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings
(loss) per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
(4.71 |
) |
|
$ |
0.96 |
|
|
|
|
$ |
(14.76 |
) |
|
$ |
2.85 |
|
|
|
Diluted |
|
$ |
(4.71 |
) |
|
$ |
0.96 |
|
|
|
|
$ |
(14.76 |
) |
|
$ |
2.84 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average shares outstanding (in thousands): |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
509,049 |
|
|
|
441,915 |
|
|
|
|
|
454,523 |
|
|
|
446,291 |
|
|
|
Diluted |
|
|
509,049 |
|
|
|
442,401 |
|
|
|
|
|
454,523 |
|
|
|
447,139 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Percent change may not recalculate due to
rounding. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Not meaningful or
greater than 100% change. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
American
Airlines Group Inc. |
Consolidated
Operating Statistics |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3 Months Ended
September 30, |
|
|
|
|
9 Months Ended
September 30, |
|
|
|
|
|
2020 |
|
2019 |
|
Change |
|
|
2020 |
|
2019 |
|
Change |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mainline |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue passenger miles (millions) |
|
14,789 |
|
57,426 |
|
(74.2 |
) |
% |
|
59,844 |
|
161,184 |
|
(62.9 |
) |
% |
Available
seat miles (ASM) (millions) |
|
25,562 |
|
66,330 |
|
(61.5 |
) |
% |
|
92,398 |
|
187,848 |
|
(50.8 |
) |
% |
Passenger
load factor (percent) |
|
57.9 |
|
86.6 |
|
(28.7 |
) |
pts |
|
64.8 |
|
85.8 |
|
(21.0 |
) |
pts |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Passenger
enplanements (thousands) |
|
14,217 |
|
40,511 |
|
(64.9 |
) |
% |
|
50,030 |
|
117,065 |
|
(57.3 |
) |
% |
Departures
(thousands) |
|
144 |
|
287 |
|
(49.6 |
) |
% |
|
478 |
|
837 |
|
(42.9 |
) |
% |
Aircraft at
end of period (1) |
|
848 |
|
940 |
|
(9.8 |
) |
% |
|
848 |
|
940 |
|
(9.8 |
) |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Block hours
(thousands) |
|
406 |
|
898 |
|
(54.7 |
) |
% |
|
1,385 |
|
2,610 |
|
(46.9 |
) |
% |
Average
stage length (miles) |
|
1,094 |
|
1,234 |
|
(11.4 |
) |
% |
|
1,121 |
|
1,211 |
|
(7.5 |
) |
% |
Fuel
consumption (gallons in millions) |
|
377 |
|
981 |
|
(61.5 |
) |
% |
|
1,338 |
|
2,772 |
|
(51.7 |
) |
% |
Average
aircraft fuel price including related taxes (dollars per
gallon) |
|
1.20 |
|
2.03 |
|
(40.7 |
) |
% |
|
1.54 |
|
2.06 |
|
(25.1 |
) |
% |
Full-time
equivalent employees at end of period |
|
87,700 |
|
103,800 |
|
(15.5 |
) |
% |
|
87,700 |
|
103,800 |
|
(15.5 |
) |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Regional (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
passenger miles (millions) |
|
3,332 |
|
7,448 |
|
(55.3 |
) |
% |
|
10,679 |
|
21,150 |
|
(49.5 |
) |
% |
Available
seat miles (millions) |
|
5,206 |
|
9,490 |
|
(45.1 |
) |
% |
|
17,550 |
|
26,968 |
|
(34.9 |
) |
% |
Passenger
load factor (percent) |
|
64.0 |
|
78.5 |
|
(14.5 |
) |
pts |
|
60.8 |
|
78.4 |
|
(17.6 |
) |
pts |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Passenger
enplanements (thousands) |
|
6,897 |
|
15,420 |
|
(55.3 |
) |
% |
|
21,656 |
|
44,265 |
|
(51.1 |
) |
% |
Aircraft at
end of period (3) |
|
533 |
|
612 |
|
(12.9 |
) |
% |
|
533 |
|
612 |
|
(12.9 |
) |
% |
Fuel
consumption (gallons in millions) |
|
122 |
|
228 |
|
(46.6 |
) |
% |
|
407 |
|
648 |
|
(37.2 |
) |
% |
Average
aircraft fuel price including related taxes (dollars per
gallon) |
|
1.30 |
|
2.13 |
|
(38.9 |
) |
% |
|
1.57 |
|
2.15 |
|
(27.1 |
) |
% |
Full-time
equivalent employees at end of period (4) |
|
22,800 |
|
28,100 |
|
(18.9 |
) |
% |
|
22,800 |
|
28,100 |
|
(18.9 |
) |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Mainline & Regional |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
passenger miles (millions) |
|
18,121 |
|
64,874 |
|
(72.1 |
) |
% |
|
70,523 |
|
182,334 |
|
(61.3 |
) |
% |
Available
seat miles (millions) |
|
30,768 |
|
75,820 |
|
(59.4 |
) |
% |
|
109,948 |
|
214,816 |
|
(48.8 |
) |
% |
Passenger
load factor (percent) |
|
58.9 |
|
85.6 |
|
(26.7 |
) |
pts |
|
64.1 |
|
84.9 |
|
(20.8 |
) |
pts |
Yield
(cents) |
|
14.01 |
|
16.95 |
|
(17.3 |
) |
% |
|
16.06 |
|
17.37 |
|
(7.5 |
) |
% |
Passenger
revenue per ASM (cents) |
|
8.25 |
|
14.50 |
|
(43.1 |
) |
% |
|
10.30 |
|
14.74 |
|
(30.1 |
) |
% |
Total
revenue per ASM (cents) |
|
10.31 |
|
15.71 |
|
(34.4 |
) |
% |
|
12.11 |
|
16.04 |
|
(24.5 |
) |
% |
Cargo ton
miles (millions) |
|
337 |
|
621 |
|
(45.8 |
) |
% |
|
949 |
|
1,889 |
|
(49.8 |
) |
% |
Cargo yield
per ton mile (cents) |
|
61.61 |
|
33.57 |
|
83.6 |
|
% |
|
51.05 |
|
34.24 |
|
49.1 |
|
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Passenger
enplanements (thousands) |
|
21,114 |
|
55,931 |
|
(62.3 |
) |
% |
|
71,686 |
|
161,330 |
|
(55.6 |
) |
% |
Aircraft at
end of period (1) (3) |
|
1,381 |
|
1,552 |
|
(11.0 |
) |
% |
|
1,381 |
|
1,552 |
|
(11.0 |
) |
% |
Fuel
consumption (gallons in millions) |
|
499 |
|
1,209 |
|
(58.7 |
) |
% |
|
1,745 |
|
3,420 |
|
(49.0 |
) |
% |
Average
aircraft fuel price including related taxes (dollars per
gallon) |
|
1.23 |
|
2.05 |
|
(40.1 |
) |
% |
|
1.55 |
|
2.08 |
|
(25.4 |
) |
% |
Full-time
equivalent employees at end of period |
|
110,500 |
|
131,900 |
|
(16.2 |
) |
% |
|
110,500 |
|
131,900 |
|
(16.2 |
) |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
cost per ASM (cents) |
|
19.64 |
|
14.64 |
|
34.2 |
|
% |
|
19.30 |
|
14.95 |
|
29.1 |
|
% |
Operating
cost per ASM excluding net special items (cents) |
|
21.33 |
|
14.33 |
|
48.8 |
|
% |
|
20.17 |
|
14.72 |
|
37.0 |
|
% |
Operating
cost per ASM excluding net special items and fuel (cents) |
|
19.34 |
|
11.07 |
|
74.7 |
|
% |
|
17.72 |
|
11.41 |
|
55.2 |
|
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Excludes 12 Boeing
737-800 mainline aircraft that are in temporary storage. |
|
|
|
|
|
(2) Regional includes wholly-owned regional airline subsidiaries
and operating results from capacity purchase carriers. |
|
|
|
|
|
|
|
(3) Includes aircraft
owned and leased by American as well as aircraft operated by
third-party regional carriers under capacity purchase agreements.
Excludes 29 regional aircraft that are in temporary storage as
follows: 13 Embraer 175, seven Embraer 140, six Embraer 145 and
three Bombardier CRJ900 aircraft. |
(4) Regional full-time
equivalent employees only include our wholly-owned regional airline
subsidiaries. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Amounts may not recalculate due to
rounding. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
American
Airlines Group Inc. |
Consolidated
Revenue Statistics by Region |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3 Months Ended
September 30, |
|
|
|
|
9 Months Ended
September 30, |
|
|
|
|
|
|
2020 |
|
2019 |
|
Change |
|
|
2020 |
|
2019 |
|
Change |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Domestic (1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue passenger miles (millions) |
|
16,508 |
|
41,951 |
|
(60.6 |
) |
% |
|
55,168 |
|
121,144 |
|
(54.5 |
) |
% |
Available seat miles (ASM) (millions) |
|
26,284 |
|
48,821 |
|
(46.2 |
) |
% |
|
85,956 |
|
141,153 |
|
(39.1 |
) |
% |
Passenger load factor (percent) |
|
62.8 |
|
85.9 |
|
(23.1 |
) |
pts |
|
64.2 |
|
85.8 |
|
(21.6 |
) |
pts |
Passenger revenue (dollars in millions) |
|
2,296 |
|
7,814 |
|
(70.6 |
) |
% |
|
9,102 |
|
23,048 |
|
(60.5 |
) |
% |
Yield (cents) |
|
13.91 |
|
18.63 |
|
(25.3 |
) |
% |
|
16.50 |
|
19.03 |
|
(13.3 |
) |
% |
Passenger revenue per ASM (cents) |
|
8.74 |
|
16.00 |
|
(45.4 |
) |
% |
|
10.59 |
|
16.33 |
|
(35.1 |
) |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Latin America (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue passenger miles (millions) |
|
1,133 |
|
7,615 |
|
(85.1 |
) |
% |
|
8,450 |
|
23,795 |
|
(64.5 |
) |
% |
Available seat miles (millions) |
|
1,773 |
|
8,813 |
|
(79.9 |
) |
% |
|
11,541 |
|
28,177 |
|
(59.0 |
) |
% |
Passenger load factor (percent) |
|
63.9 |
|
86.4 |
|
(22.5 |
) |
pts |
|
73.2 |
|
84.4 |
|
(11.2 |
) |
pts |
Passenger revenue (dollars in millions) |
|
172 |
|
1,218 |
|
(85.8 |
) |
% |
|
1,386 |
|
3,829 |
|
(63.8 |
) |
% |
Yield (cents) |
|
15.23 |
|
15.99 |
|
(4.8 |
) |
% |
|
16.41 |
|
16.09 |
|
1.9 |
|
% |
Passenger revenue per ASM (cents) |
|
9.73 |
|
13.82 |
|
(29.6 |
) |
% |
|
12.01 |
|
13.59 |
|
(11.6 |
) |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Atlantic |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue passenger miles (millions) |
|
342 |
|
11,707 |
|
(97.1 |
) |
% |
|
4,716 |
|
26,513 |
|
(82.2 |
) |
% |
Available seat miles (millions) |
|
1,827 |
|
13,914 |
|
(86.9 |
) |
% |
|
8,883 |
|
32,638 |
|
(72.8 |
) |
% |
Passenger load factor (percent) |
|
18.7 |
|
84.1 |
|
(65.4 |
) |
pts |
|
53.1 |
|
81.2 |
|
(28.1 |
) |
pts |
Passenger revenue (dollars in millions) |
|
56 |
|
1,596 |
|
(96.5 |
) |
% |
|
621 |
|
3,677 |
|
(83.1 |
) |
% |
Yield (cents) |
|
16.22 |
|
13.64 |
|
19.0 |
|
% |
|
13.16 |
|
13.87 |
|
(5.1 |
) |
% |
Passenger revenue per ASM (cents) |
|
3.04 |
|
11.47 |
|
(73.5 |
) |
% |
|
6.99 |
|
11.27 |
|
(38.0 |
) |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pacific |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue passenger miles (millions) |
|
138 |
|
3,601 |
|
(96.2 |
) |
% |
|
2,189 |
|
10,882 |
|
(79.9 |
) |
% |
Available seat miles (millions) |
|
884 |
|
4,272 |
|
(79.3 |
) |
% |
|
3,568 |
|
12,848 |
|
(72.2 |
) |
% |
Passenger load factor (percent) |
|
15.6 |
|
84.3 |
|
(68.7 |
) |
pts |
|
61.4 |
|
84.7 |
|
(23.3 |
) |
pts |
Passenger revenue (dollars in millions) |
|
16 |
|
367 |
|
(95.8 |
) |
% |
|
219 |
|
1,109 |
|
(80.3 |
) |
% |
Yield (cents) |
|
11.28 |
|
10.20 |
|
10.6 |
|
% |
|
9.98 |
|
10.19 |
|
(2.0 |
) |
% |
Passenger revenue per ASM (cents) |
|
1.76 |
|
8.59 |
|
(79.6 |
) |
% |
|
6.12 |
|
8.63 |
|
(29.0 |
) |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total International |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue passenger miles (millions) |
|
1,613 |
|
22,923 |
|
(93.0 |
) |
% |
|
15,355 |
|
61,190 |
|
(74.9 |
) |
% |
Available seat miles (millions) |
|
4,484 |
|
26,999 |
|
(83.4 |
) |
% |
|
23,992 |
|
73,663 |
|
(67.4 |
) |
% |
Passenger load factor (percent) |
|
36.0 |
|
84.9 |
|
(48.9 |
) |
pts |
|
64.0 |
|
83.1 |
|
(19.1 |
) |
pts |
Passenger revenue (dollars in millions) |
|
244 |
|
3,181 |
|
(92.3 |
) |
% |
|
2,226 |
|
8,615 |
|
(74.2 |
) |
% |
Yield (cents) |
|
15.10 |
|
13.88 |
|
8.8 |
|
% |
|
14.49 |
|
14.08 |
|
2.9 |
|
% |
Passenger revenue per ASM (cents) |
|
5.43 |
|
11.78 |
|
(53.9 |
) |
% |
|
9.28 |
|
11.70 |
|
(20.7 |
) |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Domestic results
include Canada, Puerto Rico and U.S. Virgin Islands. |
(2) Latin America
results include the Caribbean. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Amounts may not recalculate due to
rounding. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP Financial Information to Non-GAAP
Financial Information |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
American Airlines
Group Inc. (the company) sometimes uses financial measures that are
derived from the condensed consolidated financial statements but
that are not presented in accordance with GAAP to understand and
evaluate its current operating performance and to allow for
period-to-period comparisons. The company believes these non-GAAP
financial measures may also provide useful information to investors
and others. These non-GAAP measures may not be comparable to
similarly titled non-GAAP measures of other companies, and should
be considered in addition to, and not as a substitute for or
superior to, any measure of performance, cash flow or liquidity
prepared in accordance with GAAP. The company is providing a
reconciliation of reported non-GAAP financial measures to their
comparable financial measures on a GAAP basis. The tables below
present the reconciliations of the following GAAP measures to their
non-GAAP measures:
- Pre-Tax Income (Loss) (GAAP measure) to Pre-Tax Income (Loss)
Excluding Net Special Items (non-GAAP measure)
- Pre-Tax Margin (GAAP measure) to Pre-Tax Margin Excluding Net
Special Items (non-GAAP measure)
- Net Income (Loss) (GAAP measure) to Net Income (Loss) Excluding
Net Special Items (non-GAAP measure)
- Basic and Diluted Earnings (Loss) Per Share (GAAP measure) to
Basic and Diluted Earnings (Loss) Per Share Excluding Net Special
Items (non-GAAP measure)
- Operating Income (Loss) (GAAP measure) to Operating Income
(Loss) Excluding Net Special Items (non-GAAP measure)
Management uses these non-GAAP financial measures to evaluate the
company's current operating performance and to allow for
period-to-period comparisons. As net special items may vary from
period-to-period in nature and amount, the adjustment to exclude
net special items allows management an additional tool to
understand the company’s core operating performance. Additionally,
the tables below present the reconciliations of total operating
costs (GAAP measure) to total operating costs excluding net special
items and fuel (non-GAAP measure). Management uses total operating
costs excluding net special items and aircraft fuel to evaluate the
company's current operating performance and for period-to-period
comparisons. The price of fuel, over which the company has no
control, impacts the comparability of period-to-period financial
performance. The adjustment to exclude aircraft fuel and net
special items allows management an additional tool to understand
and analyze the company’s non-fuel costs and core operating
performance. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3 Months Ended
September 30, |
|
Percent Change |
|
9 Months Ended
September 30, |
|
Percent Change |
|
Reconciliation of Pre-Tax Income (Loss) Excluding Net
Special Items |
|
|
2020 |
|
|
|
2019 |
|
|
|
|
2020 |
|
|
|
2019 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in millions, except
per share amounts) |
|
|
|
(in millions, except
per share amounts) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pre-tax income (loss) as reported |
|
$ |
(3,095 |
) |
|
$ |
557 |
|
|
|
|
$ |
(8,644 |
) |
|
$ |
1,685 |
|
|
|
|
Pre-tax net
special items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Mainline operating special items, net (1) |
|
|
(295 |
) |
|
|
228 |
|
|
|
|
|
(657 |
) |
|
|
487 |
|
|
|
|
Regional operating special items, net (2) |
|
|
(224 |
) |
|
|
6 |
|
|
|
|
|
(309 |
) |
|
|
6 |
|
|
|
|
Nonoperating special items, net (3) |
|
|
(21 |
) |
|
|
44 |
|
|
|
|
|
207 |
|
|
|
43 |
|
|
|
|
Total
pre-tax net special items |
|
|
(540 |
) |
|
|
278 |
|
|
|
|
|
(759 |
) |
|
|
536 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pre-tax
income (loss) excluding net special items |
|
$ |
(3,635 |
) |
|
$ |
835 |
|
|
nm |
|
$ |
(9,403 |
) |
|
$ |
2,221 |
|
|
nm |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Calculation of Pre-Tax Margin |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pre-tax
income (loss) as reported |
|
$ |
(3,095 |
) |
|
$ |
557 |
|
|
|
|
$ |
(8,644 |
) |
|
$ |
1,685 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
operating revenues as reported |
|
$ |
3,173 |
|
|
$ |
11,911 |
|
|
|
|
$ |
13,309 |
|
|
$ |
34,455 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pre-tax
margin |
|
|
-97.6 |
% |
|
|
4.7 |
% |
|
|
|
|
-64.9 |
% |
|
|
4.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Calculation of Pre-Tax Margin Excluding Net Special
Items |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pre-tax
income (loss) excluding net special items |
|
$ |
(3,635 |
) |
|
$ |
835 |
|
|
|
|
$ |
(9,403 |
) |
|
$ |
2,221 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
operating revenues as reported |
|
$ |
3,173 |
|
|
$ |
11,911 |
|
|
|
|
$ |
13,309 |
|
|
$ |
34,455 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pre-tax
margin excluding net special items |
|
|
-114.6 |
% |
|
|
7.0 |
% |
|
|
|
|
-70.7 |
% |
|
|
6.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Net Income (Loss) Excluding Net Special
Items |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss) as reported |
|
$ |
(2,399 |
) |
|
$ |
425 |
|
|
|
|
$ |
(6,707 |
) |
|
$ |
1,272 |
|
|
|
|
Net special
items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total pre-tax net special items (1), (2), (3) |
|
|
(540 |
) |
|
|
278 |
|
|
|
|
|
(759 |
) |
|
|
536 |
|
|
|
|
Net tax effect of net special items |
|
|
121 |
|
|
|
(73 |
) |
|
|
|
|
165 |
|
|
|
(131 |
) |
|
|
|
Net income
(loss) excluding net special items |
|
$ |
(2,818 |
) |
|
$ |
630 |
|
|
nm |
|
$ |
(7,301 |
) |
|
$ |
1,677 |
|
|
nm |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Basic and Diluted Earnings (Loss) Per Share
Excluding Net Special Items |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss) excluding net special items |
|
$ |
(2,818 |
) |
|
$ |
630 |
|
|
|
|
$ |
(7,301 |
) |
|
$ |
1,677 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares used
for computation (in thousands): |
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
509,049 |
|
|
|
441,915 |
|
|
|
|
|
454,523 |
|
|
|
446,291 |
|
|
|
|
Diluted |
|
|
509,049 |
|
|
|
442,401 |
|
|
|
|
|
454,523 |
|
|
|
447,139 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings
(loss) per share excluding net special items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
(5.54 |
) |
|
$ |
1.43 |
|
|
|
|
$ |
(16.06 |
) |
|
$ |
3.76 |
|
|
|
|
Diluted |
|
$ |
(5.54 |
) |
|
$ |
1.42 |
|
|
|
|
$ |
(16.06 |
) |
|
$ |
3.75 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3 Months Ended
September 30, |
|
|
|
9 Months Ended
September 30, |
|
|
|
Reconciliation of Operating Income (Loss) Excluding Net
Special Items |
|
|
2020 |
|
|
|
2019 |
|
|
|
|
|
2020 |
|
|
|
2019 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in millions) |
|
|
|
(in millions) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income (loss) as reported |
|
$ |
(2,871 |
) |
|
$ |
808 |
|
|
|
|
$ |
(7,906 |
) |
|
$ |
2,336 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
net special items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Mainline operating special items, net (1) |
|
|
(295 |
) |
|
|
228 |
|
|
|
|
|
(657 |
) |
|
|
487 |
|
|
|
|
Regional operating special items, net (2) |
|
|
(224 |
) |
|
|
6 |
|
|
|
|
|
(309 |
) |
|
|
6 |
|
|
|
|
Operating
income (loss) excluding net special items |
|
$ |
(3,390 |
) |
|
$ |
1,042 |
|
|
|
|
$ |
(8,872 |
) |
|
$ |
2,829 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Total Operating Cost per ASM Excluding
Net Special Items and Fuel |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
operating expenses as reported |
|
$ |
6,044 |
|
|
$ |
11,103 |
|
|
|
|
$ |
21,215 |
|
|
$ |
32,119 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
net special items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Mainline operating special items, net (1) |
|
|
295 |
|
|
|
(228 |
) |
|
|
|
|
657 |
|
|
|
(487 |
) |
|
|
|
Regional operating special items, net (2) |
|
|
224 |
|
|
|
(6 |
) |
|
|
|
|
309 |
|
|
|
(6 |
) |
|
|
|
Total
operating expenses, excluding net special items |
|
|
6,563 |
|
|
|
10,869 |
|
|
|
|
|
22,181 |
|
|
|
31,626 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fuel: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Aircraft fuel and related taxes - mainline |
|
|
(453 |
) |
|
|
(1,989 |
) |
|
|
|
|
(2,065 |
) |
|
|
(5,710 |
) |
|
|
|
Aircraft fuel and related taxes - regional |
|
|
(158 |
) |
|
|
(485 |
) |
|
|
|
|
(638 |
) |
|
|
(1,395 |
) |
|
|
|
Total
operating expenses, excluding net special items and fuel |
|
$ |
5,952 |
|
|
$ |
8,395 |
|
|
|
|
$ |
19,478 |
|
|
$ |
24,521 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in cents) |
|
|
|
(in cents) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
operating expenses per ASM as reported |
|
|
19.64 |
|
|
|
14.64 |
|
|
|
|
|
19.30 |
|
|
|
14.95 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
net special items per ASM: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Mainline operating special items, net (1) |
|
|
0.96 |
|
|
|
(0.30 |
) |
|
|
|
|
0.60 |
|
|
|
(0.23 |
) |
|
|
|
Regional operating special items, net (2) |
|
|
0.73 |
|
|
|
(0.01 |
) |
|
|
|
|
0.28 |
|
|
|
- |
|
|
|
|
Total
operating expenses per ASM, excluding net special items |
|
|
21.33 |
|
|
|
14.33 |
|
|
|
|
|
20.17 |
|
|
|
14.72 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fuel per
ASM: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Aircraft fuel and related taxes - mainline |
|
|
(1.47 |
) |
|
|
(2.62 |
) |
|
|
|
|
(1.88 |
) |
|
|
(2.66 |
) |
|
|
|
Aircraft fuel and related taxes - regional |
|
|
(0.51 |
) |
|
|
(0.64 |
) |
|
|
|
|
(0.58 |
) |
|
|
(0.65 |
) |
|
|
|
Total
operating expenses per ASM, excluding net special items and
fuel |
|
|
19.34 |
|
|
|
11.07 |
|
|
|
|
|
17.72 |
|
|
|
11.41 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Amounts may not recalculate due to
rounding. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FOOTNOTES: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
The 2020 third quarter mainline operating special items, net
principally included $1.9 billion of Payroll Support Program (PSP)
financial assistance, offset in part by $871 million of salary and
medical costs associated with certain team members who opted in to
voluntary early retirement programs or who were notified in the
third quarter of 2020 they were being involuntarily furloughed
starting October 1, 2020, subsequent to the expiration of the PSP
requirement against involuntary furloughs, as a result of
reductions to the company's operation due to COVID-19 and $742
million of fleet impairment charges. The 2020 nine month period
mainline operating special items, net principally included $3.7
billion of PSP financial assistance, offset in part by $1.5 billion
of fleet impairment charges, $1.4 billion of salary and medical
costs associated with the voluntary early retirement programs and
involuntary furlough notifications discussed above and $228 million
of one-time labor contract expenses resulting from the ratification
of a new contract with the company's maintenance and fleet service
team members, including signing bonuses and adjustments to vacation
accruals resulting from pay rate increases. Cash payments related
to the special charges for salary and medical costs associated with
the voluntary early retirement programs and involuntary furlough
notifications discussed above were approximately $120 million and
$170 million for the 2020 third quarter and nine month period,
respectively. Fleet impairment charges resulted from the company's
decision to retire certain aircraft earlier than planned driven by
the decline in air travel due to COVID-19. Aircraft retired include
Airbus A330-200, Boeing 757, Boeing 767, Airbus A330-300 and
Embraer 190 aircraft. The 2020 third quarter fleet impairment
charges included a $709 million non-cash write-down of Airbus
A330-200 aircraft and spare parts and $33 million in cash charges
primarily for lease return and other costs. The 2020 nine month
period fleet impairment charges included a $1.4 billion non-cash
write-down of mainline aircraft and spare parts and $102 million in
cash charges primarily for impairment of right-of-use assets and
lease return costs. The 2019 third quarter mainline operating
special items, net principally included a $201 million non-cash
impairment charge related to the retirement of the company's
Embraer 190 fleet, $72 million of fleet restructuring expenses and
$29 million of merger integration expenses, offset in part by a $53
million credit to reduce certain litigation reserves. The 2019 nine
month period mainline operating special items, net principally
included $232 million of fleet restructuring expenses, the $201
million non-cash fleet impairment charge discussed above and $106
million of merger integration expenses, offset in part by the $53
million credit to reduce certain litigation reserves. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2) |
The 2020 third quarter regional operating special items, net
primarily included $228 million of PSP financial assistance. The
2020 nine month period regional operating special items, net
included $444 million of PSP financial assistance, offset in part
by $117 million of fleet impairment charges and $18 million of
salary and medical costs associated with certain team members who
opted in to voluntary early retirement programs or who were
involuntarily furloughed starting October 1, 2020 as a result of
reductions to the company's operation due to COVID-19. The fleet
impairment charges principally included a non-cash write-down of
regional aircraft and spare parts resulting from the company’s
decision to retire certain aircraft earlier than planned driven by
the decline in air travel due to COVID-19. Aircraft retired include
certain Embraer 140 and Bombardier CRJ200 aircraft. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(3) |
Principally included mark-to-market net unrealized gains and losses
associated with certain equity investments and treasury rate lock
derivative instruments as well as charges associated with debt
refinancings and extinguishments. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average Daily Cash Burn |
|
|
|
|
|
|
|
|
|
|
|
The company's
average daily cash burn is presented in the table below, which is a
non-GAAP measure that management believes is useful information to
investors and others in evaluating the company's liquidity position
and cash flows from its core operating performance. The company
defines cash burn as net cash provided by (used in) operating
activities, net cash provided by (used in) investing activities and
net cash provided by (used in) financing activities, adjusted for
(1) CARES Act Payroll Support Program grant proceeds, (2) net
purchases (proceeds from sale) of short-term investments and
restricted short-term investments, (3) proceeds from issuance of
long-term debt, net of deferred financing costs, but excluding
aircraft financing, (4) proceeds from issuance of equity, (5)
prepayments of long-term debt and (6) other cash flows that are not
representative of our core operating performance. This non-GAAP
measure may not be comparable to similarly titled non-GAAP measures
of other companies, and should be considered in addition to, and
not as a substitute for or superior to, any measure of performance,
cash flow or liquidity prepared in accordance with GAAP. |
|
|
|
|
|
|
|
|
|
3 Months Ended September 30, 2020 |
|
3 Months Ended June 30, 2020 |
|
|
|
|
|
|
|
|
|
(in millions, except
days in period) |
|
|
|
|
|
|
|
Net cash used in operating activities |
|
$ |
(2,604 |
) |
|
$ |
(908 |
) |
|
Net cash
provided by (used in) investing activities |
|
|
923 |
|
|
|
(6,799 |
) |
|
Net cash
provided by financing activities |
|
|
1,511 |
|
|
|
7,688 |
|
|
|
|
|
|
|
|
Adjustments: |
|
|
|
|
|
CARES Act Payroll Support Program grant proceeds |
|
|
(525 |
) |
|
|
(3,693 |
) |
|
Net purchases (proceeds from sale) of short-term investments and
restricted short-term investments |
|
|
(1,391 |
) |
|
|
6,608 |
|
|
Proceeds from issuance of non-aircraft long-term debt, net of
deferred financing costs |
|
|
(1,926 |
) |
|
|
(7,714 |
) |
|
Proceeds from issuance of equity |
|
|
- |
|
|
|
(1,525 |
) |
|
Prepayments of long-term debt |
|
|
- |
|
|
|
1,047 |
|
|
Other |
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
Total cash
burn (1) |
|
$ |
(4,012 |
) |
|
$ |
(5,296 |
) |
|
|
|
|
|
|
|
Days in
period |
|
|
92 |
|
|
|
91 |
|
|
|
|
|
|
|
|
Average
daily cash burn |
|
$ |
(44 |
) |
|
$ |
(58 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: Amounts may not recalculate due to
rounding. |
|
|
|
|
|
|
|
|
|
|
(1) |
Of the total cash burn for each of the three months ended September
30, 2020 and June 30, 2020, approximately $540 million and $505
million were cash payments for debt amortization, respectively, and
approximately $120 million and $50 million were cash payments for
salary and medical costs for our voluntary early retirement
programs, respectively, totaling an equivalent of approximately $8
million per day and $6 million per day, respectively. |
|
|
American
Airlines Group Inc. |
Condensed
Consolidated Balance Sheets |
(In
millions) |
|
|
|
|
|
|
September 30, 2020 |
|
|
December 31, 2019 |
|
|
|
|
|
|
|
|
(unaudited) |
|
|
Assets |
|
|
|
|
|
|
|
Current
assets |
|
|
|
Cash |
$ |
253 |
|
|
$ |
280 |
|
Short-term investments |
|
8,031 |
|
|
|
3,546 |
|
Restricted cash and short-term investments |
|
508 |
|
|
|
158 |
|
Accounts receivable, net |
|
1,135 |
|
|
|
1,750 |
|
Aircraft fuel, spare parts and supplies, net |
|
1,633 |
|
|
|
1,851 |
|
Prepaid expenses and other |
|
780 |
|
|
|
621 |
|
Total current assets |
|
12,340 |
|
|
|
8,206 |
|
|
|
|
|
Operating
property and equipment |
|
|
|
Flight equipment |
|
37,576 |
|
|
|
42,537 |
|
Ground property and equipment |
|
9,451 |
|
|
|
9,443 |
|
Equipment purchase deposits |
|
1,899 |
|
|
|
1,674 |
|
Total property and equipment, at cost |
|
48,926 |
|
|
|
53,654 |
|
Less accumulated depreciation and amortization |
|
(16,670 |
) |
|
|
(18,659 |
) |
Total property and equipment, net |
|
32,256 |
|
|
|
34,995 |
|
|
|
|
|
Operating
lease right-of-use assets |
|
7,979 |
|
|
|
8,737 |
|
|
|
|
|
Other
assets |
|
|
|
Goodwill |
|
4,091 |
|
|
|
4,091 |
|
Intangibles, net |
|
2,039 |
|
|
|
2,084 |
|
Deferred tax asset |
|
2,425 |
|
|
|
645 |
|
Other assets |
|
1,643 |
|
|
|
1,237 |
|
Total other assets |
|
10,198 |
|
|
|
8,057 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets |
$ |
62,773 |
|
|
$ |
59,995 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities
and Stockholders’ Equity (Deficit) |
|
|
|
|
|
|
|
Current
liabilities |
|
|
|
Current maturities of long-term debt and finance leases |
$ |
2,710 |
|
|
$ |
2,861 |
|
Accounts payable |
|
1,077 |
|
|
|
2,062 |
|
Accrued salaries and wages |
|
1,919 |
|
|
|
1,541 |
|
Air traffic liability |
|
4,903 |
|
|
|
4,808 |
|
Loyalty program liability |
|
2,051 |
|
|
|
3,193 |
|
Operating lease liabilities |
|
1,736 |
|
|
|
1,708 |
|
Other accrued liabilities |
|
2,188 |
|
|
|
2,138 |
|
Total current liabilities |
|
16,584 |
|
|
|
18,311 |
|
|
|
|
|
Noncurrent
liabilities |
|
|
|
Long-term debt and finance leases, net of current maturities |
|
30,076 |
|
|
|
21,454 |
|
Pension and postretirement benefits |
|
6,310 |
|
|
|
6,052 |
|
Loyalty program liability |
|
7,043 |
|
|
|
5,422 |
|
Operating lease liabilities |
|
6,683 |
|
|
|
7,421 |
|
Other liabilities |
|
1,605 |
|
|
|
1,453 |
|
Total noncurrent liabilities |
|
51,717 |
|
|
|
41,802 |
|
|
|
|
|
Stockholders' equity (deficit) |
|
|
|
Common stock |
|
5 |
|
|
|
4 |
|
Additional paid-in capital |
|
5,430 |
|
|
|
3,945 |
|
Accumulated other comprehensive loss |
|
(6,476 |
) |
|
|
(6,331 |
) |
Retained earnings (deficit) |
|
(4,487 |
) |
|
|
2,264 |
|
Total stockholders' deficit |
|
(5,528 |
) |
|
|
(118 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and stockholders’ equity (deficit) |
$ |
62,773 |
|
|
$ |
59,995 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
American
Airlines Group Inc. |
Condensed
Consolidated Statements of Cash Flows |
(In
millions)(Unaudited) |
|
|
|
|
|
|
|
9 Months Ended
September 30, |
|
|
|
2020 |
|
|
|
2019 |
|
|
|
|
|
|
Net cash provided by (used in) operating
activities |
$ |
(3,680 |
) |
|
$ |
3,215 |
|
Cash flows from investing activities: |
|
|
|
Capital expenditures and aircraft purchase deposits |
|
(1,810 |
) |
|
|
(3,129 |
) |
Proceeds from sale-leaseback transactions |
|
433 |
|
|
|
629 |
|
Proceeds from sale of property and equipment |
|
251 |
|
|
|
42 |
|
Purchases of short-term investments |
|
(7,086 |
) |
|
|
(2,878 |
) |
Sales of short-term investments |
|
2,603 |
|
|
|
2,524 |
|
Increase in restricted short-term investments |
|
(317 |
) |
|
|
(2 |
) |
Other investing activities |
|
(112 |
) |
|
|
(68 |
) |
Net cash used in investing activities |
|
(6,038 |
) |
|
|
(2,882 |
) |
Cash flows from financing activities: |
|
|
|
Proceeds from issuance of long-term debt |
|
11,564 |
|
|
|
3,550 |
|
Payments on long-term debt and finance leases |
|
(3,018 |
) |
|
|
(2,835 |
) |
Proceeds from issuance of equity |
|
1,527 |
|
|
|
- |
|
Deferred financing costs |
|
(132 |
) |
|
|
(51 |
) |
Treasury stock repurchases |
|
(173 |
) |
|
|
(825 |
) |
Dividend payments |
|
|
(43 |
) |
|
|
(135 |
) |
Net cash provided by (used in) financing activities |
|
9,725 |
|
|
|
(296 |
) |
Net increase in cash and restricted cash |
|
7 |
|
|
|
37 |
|
Cash and restricted cash at beginning of period |
|
290 |
|
|
|
286 |
|
Cash and restricted cash at end of period (1) |
$ |
297 |
|
|
$ |
323 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) The following table provides a reconciliation of cash and
restricted cash to amounts reported within the condensed
consolidated balance sheets: |
|
|
|
|
|
Cash |
|
$ |
253 |
|
|
$ |
312 |
|
Restricted
cash included in restricted cash and short-term investments |
|
|
44 |
|
|
|
11 |
|
Total cash and restricted cash |
$ |
297 |
|
|
$ |
323 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
American Airlines (NASDAQ:AAL)
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