AMR Q2 loss $286mil

[737823]

I know the big news today is the fleet renewal orders but:

AMR Corporation Reports Second Quarter 2011 Net Loss of $286 Million

Fuel Price Increase of 31 Percent Year-Over-Year Drove $524 Million of Additional Expense

AMR Second Quarter 2011 Revenue Rose 8 Percent Compared to Same Period a Year Ago

AMR takes steps to positIon the company for long-term success, including landmark agreements to transform its narrowbody fleet; intention to move forward with a divestiture of American Eagle regional affiliate; and implementation of additional initiatives

FORT WORTH, Texas, July 20, 2011 /PRNewswire/ -- AMR Corporation (NYSE: AMR), the parent company of American Airlines, Inc., today reported a net loss of $286 million for the second quarter of 2011, or $0.85 per share, compared to a net loss of $11 million, or $0.03 per share, in the second quarter of 2010.

The Company's second quarter performance was negatively impacted by fuel prices that increased 31 percent compared to the second quarter 2010. Including the impact of fuel hedging, AMR paid on average $3.12 per gallon for jet fuel in the second quarter of this year versus $2.37 per gallon in the second quarter 2010. As a result, the Company paid $524 million more for fuel in the second quarter 2011 than it would have paid at prevailing prices from the corresponding prior-year period.

"This past quarter was challenging in many respects," said AMR Chairman and CEO Gerard Arpey. "We remain acutely focused on taking the necessary steps to manage through our near-term challenges while continuing to lay the foundation for long-term success. We believe we have the right framework under our Flight Plan 2020 strategy to achieve our long-term objectives for the benefit of all our stakeholders, and today we took several major steps forward. I would also like to thank all of our employees for their efforts to serve our customers, particularly during the extreme weather conditions and tornadoes in April and May, and for their hard work and dedication during a very busy summer."

Time for further concessions??

The bolded part is for Bob-Arpey DOES appreciate your efforts and dedication and is saying so publicly

Josh

 

[Hopeful]

I know the big news today is the fleet renewal orders but:



Time for further concessions??

The bolded part is for Bob-Arpey DOES appreciate your efforts and dedication and is saying so publicly

Josh

Actions speak louder than words.

 

[Frank Szabo]

I know the big news today is the fleet renewal orders but:



Time for further concessions??

The bolded part is for Bob-Arpey DOES appreciate your efforts and dedication and is saying so publicly

Josh

An old Irish saying is, " 'thank you' doesn't pay the fiddler".

Cha dèan ‘Tapadh leis an fhìdhlear’ am fìdhlear a phàigheadh.


Considering the continued tone of the supposed "negotiations", I believe we, to a man, take his "thanks" as another slap in the face.

Now - be a good little boy and Bugger Off.

 

[Bob Owens]

I know the big news today is the fleet renewal orders but:



Time for further concessions??

The bolded part is for Bob-Arpey DOES appreciate your efforts and dedication and is saying so publicly

Josh

Sure but at the table, where it really counts he is saying F. U.
Its like a guy who tells the world he loves his wife then goes home and beats her.

 

[AANOTOK]

I know the big news today is the fleet renewal orders but:



Time for further concessions??

The bolded part is for Bob-Arpey DOES appreciate your efforts and dedication and is saying so publicly

Josh

Nope, Josh, just time for you to start paying what it really cost to fly you around the world.
Oh, and since you speak for Jacob, tell him what I said!

 

[WorldTraveler]

a few notes from the earnings release...

AMR opened the possibility of capacity reductions later in the year... which is a good thing since RASM was down markedly in the Pacific and Atlantic on significant capacity increases. Latin America for AA showed a very healthy double digit RASM increase but on flat capacity. Domestic was up about 5% on slightly reduced capacity. AA's efforts to add capacity across the Atlantic and Pacific are not financially healthy.
.
AMR has added about 2000 employees in the past year... half at mainline. Thus their non-fuel labor costs went up faster than they have in the past several quarters.

AMR has taken on about $1B more debt than it had this time last year in order to fund operational losses even though its cash on hand remains stable.
.
Fuel now accounts for 36% of AMRs costs.... although they are well hedged, they still expect they will see no meaningful relief in fuel prices for the rest of the year.

 

[eolesen]

Count of employees I saw was closer to 1200 employees. ~ 250 of that is flight attendants (if not more) including the Mandarin speakers. I'm guessing they also had to add some employees internationally to support new flying. The balance must be the 200 supervisors hired just at JFK according to Bob, and personal trainers & drivers for every vice president and managing director....

In seriousness, I think AA realized they let attrition go too far in 2010 and are now just catching up. With record high load factors, operating on a shoestring at the airports hasn't helped things and it shows with AA's DOT numbers for baggage.

DUB Res is closing, but unless that's been offloaded to BA or an outsourcer like Carlson, there may be an offset at the SRO or another call center to manage all the German/Italian/French calls that were going thru DUB...

I'm less worried right now about borrowing money to keep the cash balance up. If fuel spikes again, they need a buffer.

 

[Frank Szabo]

a few notes from the earnings release...

AMR opened the possibility of capacity reductions later in the year... which is a good thing since RASM was down markedly in the Pacific and Atlantic on significant capacity increases. Latin America for AA showed a very healthy double digit RASM increase but on flat capacity. Domestic was up about 5% on slightly reduced capacity. AA's efforts to add capacity across the Atlantic and Pacific are not financially healthy.
.
AMR has added about 2000 employees in the past year... half at mainline. Thus their non-fuel labor costs went up faster than they have in the past several quarters.

AMR has taken on about $1B more debt than it had this time last year in order to fund operational losses even though its cash on hand remains stable.
.
Fuel now accounts for 36% of AMRs costs.... although they are well hedged, they still expect they will see no meaningful relief in fuel prices for the rest of the year.

Wake up and smell the coffee, turkey - people have been hired at the behest of the TWU to provide them with more dues income. There will be a layoff but nowhere near the number that actually would have to go to the street, assuming the company had any intent of running American as a real business.

 

[WorldTraveler]

Count of employees I saw was closer to 1200 employees. ~ 250 of that is flight attendants (if not more) including the Mandarin speakers. I'm guessing they also had to add some employees internationally to support new flying. The balance must be the 200 supervisors hired just at JFK according to Bob, and personal trainers & drivers for every vice president and managing director....

In seriousness, I think AA realized they let attrition go too far in 2010 and are now just catching up. With record high load factors, operating on a shoestring at the airports hasn't helped things and it shows with AA's DOT numbers for baggage.

DUB Res is closing, but unless that's been offloaded to BA or an outsourcer like Carlson, there may be an offset at the SRO or another call center to manage all the German/Italian/French calls that were going thru DUB...

I'm less worried right now about borrowing money to keep the cash balance up. If fuel spikes again, they need a buffer.

yes, AA probably like alot of airlines allowed staffing to slip too much but they probably also know they have to hire to offset attrition. Given AA has plans to cut less capacity, they cannot afford to allow a bunch of employees retire and then wake up understaffed - esp. if the new emplotyees are less experienced. Insomuch as there are cuts within the areas represented by the TWU, then they will get their fare share of new members - at least until the attrition cranks up.
If BK really does apprear to be likely, there will be a mad rush for the exits - that has been the case at other airlines.

 

[Birdman]

AMR has taken on about $1B more debt than it had this time last year in order to fund operational losses even though its cash on hand remains stable.
.
Fuel now accounts for 36% of AMRs costs.... although they are well hedged, they still expect they will see no meaningful relief in fuel prices for the rest of the year.

United claims to have spend $1bil+ more for fuel in the past year, dropped $145mil on United/Cont integration, $100mil on revenue lost from Japan tragedy and still managed a $538mil profit. AMR must be at a greater disadvantage than than they thought.

 

[WorldTraveler]

United claims to have spend $1bil+ more for fuel in the past year, dropped $145mil on United/Cont integration, $100mil on revenue lost from Japan tragedy and still managed a $538mil profit. AMR must be at a greater disadvantage than than they thought.

AMR's non-fuel mainline CASM excluding special items was 8.92 while it was 8.17 for UA. UA also did a better job based on RASM change at matching capacity to what the market could bear - but that is precisely one of the benefits that airlines have said would come from mergers; when you are large enough, you can cut and still not affect your network footprint.

 

[strikeforce]

AMR has taken on about $1B more debt than it had this time last year in order to fund operational losses even though its cash on hand remains stable.

Gee.....use the credit cards to pay your bills and keep the cash in the bank. And, that's a good thing????

Is this concept taught in Finance 101???? No wonder corporate america is in deep sh%t!

 

[Frank Szabo]

Gee.....use the credit cards to pay your bills and keep the cash in the bank. And, that's a good thing????

Is this concept taught in Finance 101???? No wonder corporate america is in deep sh%t!

Hey - it's how his Imperial majesty O'Bummer wants to do things (except there's no cash in the bank) - why not??

 

[strikeforce]

AMR's non-fuel mainline CASM excluding special items was 8.92 while it was 8.17 for UA. UA also did a better job based on RASM change at matching capacity to what the market could bear - but that is precisely one of the benefits that airlines have said would come from mergers; when you are large enough, you can cut and still not affect your network footprint.

Give it TIME, my boy.......AA & TWA merger looked rosy at the beginning, too.

The only thing that airlines get with mergers is......HEADACHES

You, Josh and Eric appear to be experts on this forum with fancy acronyms, numbers, and solutions.......Well, did it ever appear to you that maybe UA's management is MUCH better at running an airline than Arpey & co.???????

 

[Buck]

Hey - it's how his Imperial majesty O'Bummer wants to do things (except there's no cash in the bank) - why not??

Its not a bank, its Obama's stash..........