AMR reports consolidated PRASM growth of 10.3% in Q1

[FWAAA]

AMR reported first quarter consolidated PRASM gain of 10.3% compared to first quarter of last year; no doubt not as large a gain as that special Atlanta-based airline, but impressive nonetheless.

Net loss, excluding special items and reorg expenses, shrinks to $248 million in first quarter, compared to $405 million in first quarter of 2011:

http://aa.mediaroom.com/index.php?s=43&item=3493

Mainline yield was up more than a penny a mile to 15.21 cents; I think that's the highest it's ever been (in nominal terms, not real terms).

Total revenue was up $500 million compared to Q12011 - at that rate, revenue for 2012 should be about $2 billion higher than last year. That one billion of revenue improvement target in Horton's plan shouldn't be too difficult to achieve as AMR is halfway there after just the first quarter.

Generally, bankruptcy causes some bookaway and decreased revenue, but so far, that doesn't seem to be hurting AA. Should have filed Ch 11 earlier.

 

[WorldTraveler]

These are exactly the type of revenue numbers AA needs to show to prove it can successfully restructure, esp. when you consider that DL cut capacity more than AA... but that's exactly what they are able to do because of the larger size of their network which does provide a lot of redundancy.
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As you have noted to Owens many times, though, fuel is going up just as fast as revenue increases are - so AMR has to generate a billion dollars MORE in revenue above costs... .right now they are slightly improving their performance relative to costs - but given that their costs are not fully being paid while in BK, they are far from 1/2 way to their cost goal unless AA has figured out a way to get fuel at last year's costs.
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Still, I think this says that AA has not lost its grip on revenue and is demonstrating that it is so far possible to be smaller than DL and UA. But let's also keep in mind that UA has had a rough quarter and it isn't certain how much of AA"s revenue gain is attributable to UA's problems.
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AA has clearly passed a critical phase in demonstrating it is capable of exiting as a standalone carrier.

 

[FWAAA]

I wouldn't say that AA is out of the woods just yet but the first quarter numbers are much better than I expected. If AA can keep it up on the revenue side for the next several months, it's just a matter of achieving its labor cost targets.

 

[WorldTraveler]

I wouldn't say that AA is out of the woods just yet but the first quarter numbers are much better than I expected. If AA can keep it up on the revenue side for the next several months, it's just a matter of achieving its labor cost targets.

precisely... there is alot of work to do, including defending AA's network from competitive assaults which continue to grow. But since BK gives a company a huge amount of latitude to control costs but very little over revenue production, if AA can demonstrate that it can generate revenue at levels necessary to remain a viable force in the industry, then the business plan will come together.