Originally Posted by
El Peso
The key point here is that for the month of June AA was cash positive excluding special items and including principle debt payments. But yes Q2 will post an operating loss of about 1.1B.
Raising the question of whether or not they HAD any debt principle payments in the second quarter. I think they only have two relatively small bond issuances maturing this year, one for $500 million and one for $750 million. They are unlikely to pay off either of these, most likely just selling new bonds to pay off the old ones, but I think those might both be in later quarters.
We know they had interest payments. They had $371 million in interest expense last quarter which was up $120 million YOY.
Second quarter interest expense for 2021 will likely be higher still since they’ve increased their borrowing since 2020.
. American Airlines Group Inc. raised $10 billion of debt last week to repay government loans and keep its business running as the economy recovers. The deal also boosted the company’s debt by about 20%, transferring much of that risk onto debt investors.
American has survived the pandemic by taking on $22 billion of new debt, bringing its total obligations to $50 billion. Borrowing saved the company—and others like Carnival Corp. and AMC Entertainment Holdings Inc.—from bankruptcy, but it comes with higher interest costs that could affect profitability for years to come.
https://www.wsj.com/articles/america...hs-11615973407