American Airlines has reported a first-quarter net loss of $2.2 billion, or $5.26 per share. Excluding net special items, first-quarter net losses totaled $1.1 billion. Revenue at the US-based carrier dropped nearly 20 per cent year-on-year to $8.52 billion.
“Never before has our airline, or our industry, faced such a significant challenge,” said American Airlines chief executive, Doug Parker.
“We have moved quickly and aggressively to reduce our costs and bolster our liquidity.
“We are particularly grateful for the $5.8 billion in financial assistance American will receive through the payroll support program, and we appreciate the bipartisan congressional and United States department of the treasury and department of transportation support to protect airline jobs and ensure a strong and competitive United States airline industry.”
American reduced system capacity by approximately 80 per cent in both April and May, and 70 per cent in June, including schedule changes announced today.
During the quarter, American recognised $744 million in fleet impairment charges, which consisted of a $676 million non-cash write-down of aircraft and spare parts and $68 million in write-offs of right-of-use assets and lease return costs associated with the mainline fleet.
Four aircraft types – consisting of 20 Embraer E190s, 34 Boeing 757s, 17 Boeing 767s and nine Airbus A330-300s – were retired, along with a number of older regional aircraft.
These changes remove operating complexity and bring forward cost savings and efficiencies associated with operating fewer aircraft types, the carrier said.
The company also took a $218 million hit in one-time labour contract expenses resulting from the ratification of a new contract with its maintenance and fleet service team members.
American ended the first quarter with $6.8 billion of available liquidity and expects to end second quarter with approximately $11 billion of liquidity.
“We have a lot of difficult work ahead of us,” added Parker.
“And while there is still uncertainty in what’s to come, we are confident that through the dedication of the American Airlines team and our swift actions, we will get through this for our team, our customers and our shareholders.”
