eolesen
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- Jul 23, 2003
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From DMN's aviation blog... Still haven't seen the official release
When the new American Airlines Group launched itself with more than $10 billion in cash, investors wanted to know what it was going to do with so much money on hand.
On Thursday, the company provided an answer.
It announced that it would begin paying a quarterly dividend of 10 cents a share as well as:
Prepay more than $2.8 billion in debt and aircraft leases.
Devote $1 billion to repurchase its shares
Contribute an extra $600 million to its pension plans.
The company said it ended the second quarter June 30 with about $10.3 million in cash and short-term investments, even though it had repaid about $502 million in debt during the three months.
The announcement was part of its report of second quarter earnings of $1.5 billion excluding items and special charges. Including those items, it earned $864 million.
American Airlines chairman and CEO Doug Parker said the dividend was the first paid by American since 1980, before it transformed itself into AMR Corp. in 1982, filed for bankruptcy in 2011 or merged Dec. 9, 2013, with US Airways.
We are very pleased to report the highest quarterly profit in the history of American Airlines. Our merger is off to a great start and our 100,000 team members are doing a wonderful job working together to take care of our customers, Parker said.
We are also pleased to announce a capital deployment program that reduces our debt, provides additional pension contributions and returns capital to shareholders, he said.
The fact that we are able to implement this program while still funding our significant product improvements, fleet renewal program and integration costs is further evidence of the success of our merger. We have much hard work ahead, but we are extremely encouraged by the great work being done by our team members, Parker said.