Path to Recovery: American Airlines Reports Record Quarterly Revenues
American Airlines today reported its financial and operating results for the third quarter of 2022.
“The American Airlines team continues to deliver on our goals of running a reliable operation and returning to profitability”, said Robert Isom, the company’s CEO. “Demand remains strong and it’s clear that customers in the United States and other parts of the world continue to value air travel and the ability to reconnect post-pandemic”, he added.
The company said that despite a “challenging operating environment” because of hurricanes that affected operations in Florida and the Caribbean and flooding in Dallas-Fort Worth, it was able to “restore its operational reliability” thanks to a good on-time arrival rate and completion factor
American Airlines third quarter 2022 key financial and operating results
- Record quarterly revenue for the company totalled 13.5 billion dollars. The figure represents a 13 percent increase over the same period in 2019, despite recording 9.6 percent less capacity compared to the third quarter of 2019.
- Net income of 483 million dollars, or 0.69 dollars per diluted share.
- Fuel expenses of 3.8 billion dollars, 97.1 percent higher than in the same period of 2021.
- Operating margin, excluding net special items, of 7.2 percent.
- Liquidity of 14.3 billion dollars, more than double that of the same period in 2019.
- The company made approximately 380 million dollars in scheduled debt and lease payments between July and September.
- As of 30 September 2022, it had reduced its total debt by 5.6 billion dollars from peak levels, reported in the second quarter of 2021.
- “Debt reduction continues to be a top priority”, the company said. In that regard, it stressed that it would continue to pursue its plan to reduce total debt levels by 15 billion dollars by the end of 2025.
- American Airlines and its regional partners operated more than 500.000 flights in the third quarter of this year.
- The average occupancy rate reached 85.3 percent, up 6.6 percentage points from the same period in 2021.
Projections for the last quarter of the year
Based on current trends, the company expects its total revenue for the fourth quarter to be 11 to 13 percent higher than that reported in the fourth quarter of 2019. However, it expects total capacity to still be 5 to 7 percent lower. The airline maintains a schedule that includes more than five thousand daily operations on average until the end of the year.
With the current demand trends and fuel price forecast, American Airlines expects to have a positive operating margin of between 5.5 and 7.5 percent between October and December this year. In addition, it forecasts its diluted earnings per share, excluding net special items, to be between 0.50 and 0.70 dollars.