Not exactly how that works. Bond interest is market driven and that market is driven by ratings of the bonds from rating agencies vs offered yield. The $2.5 billion that AA sold this summer was rated at junk bond levels and as a consequence they had to offer a coupon of 11,75%. But even at that is didn’t sell at par, meaning a nominal $1000 purchase actually sold for less than that driving the debt service on what did sell up to 12%.
https://www.bloomberg.com/news/artic...l-to-2-billion
While AA has relatively little bond debt maturing this next year (I think one tranche of about $500 million and another of $750 million, IIRC) they will either have to refinance that at market rates or use $1.25 Billion of their current liquidity (a month of operations at current burn rates) to cover those expenses. But is the next year - 2022 - that the existing bonds really start maturing for a lot of the fleet modernization. Those bonds were sold at exceptionally low rates because times were good, the airline industry was doing well, and the bonds were collateralized by the new aircraft themselves. But now the aircraft are no longer new, and with all the airlines that have tanked, a glut of good late model used aircraft and even new ‘white tail’ aircraft have driven down used aircraft value. These bonds were always going to have to either be paid off (which AA won’t have the cash to do) or refinanced at a higher rate, but no one five years ago anticipated the rates would go as high as they are now, meaning AAs debt service, currently $1.3 Billion a year after this summers junk bond sale, is going to go higher.
To put that in perspective, AAs 2019 profit was about $2 Billion on revenues of about $46 Billion, not a profit margin that is going to allow them to pay off many of their maturing bonds. Their situation is analogous to someone with a lot of credit card debt keeping afloat by repeatedly transferring the balance from the old credit credit card to a new credit card, always at a higher interest.
Unless business and international flying comes back quickly - or they can sell those assets to someone else - they are going to find it hard to get refinancing at affordable prices.
Their current strategy, downsizing to profitability, won’t help flow much either...