Earnings
#1
Earnings
OFFICIAL
American reports third-quarter 2019 profit
5 minute read
Created by Andrea Koos
on Oct 24, 2019 6:16 AM
In a letter to team members Oct. 24, CEO Doug Parker and President Robert Isom announced our third-quarter 2019 earnings. Read the full letter below.
Dear fellow team members,
Today we announced the company’s third-quarter earnings results. American reported revenue of $11.9 billion, 3% higher than the same period last year, and a record for the third quarter. That makes 12 consecutive quarters of improving our total revenue per available seat mile (TRASM), and we’re confident that trend will continue the rest of the year. Excluding net special items, our net profit for the quarter was $630 million, a 15% increase over the third quarter 2018. The third quarter added $52 million to the 2019 profit-sharing program, bringing the total to $139 million to be shared by American’s 130,000 team members.
Producing such strong results despite a difficult summer is due entirely to your hard work. Frontline team members have gone above and beyond to care for customers during the peak months even with operational challenges, including the ongoing grounding of our Boeing 737 MAX fleet. Thank you for your continued commitment to doing your best for our customers, no matter the circumstances.
While we are proud of these results, we know they can be better. As we near the end of 2019, we are committing to deliver on three key areas that will create value for our company in 2020:
Operational Excellence: We believe the issues that impacted our operations through much of the summer are now behind us. We had a solid September, and that strong performance has continued into October. But, two months don’t make a trend, and we won’t rely entirely on our recent performance or our forward confidence. We have specific plans in place to improve our operating reliability beyond reaching a labor agreement and specific goals that we will meet. We will not allow our team members and customers to experience another period like this past summer.
Efficient and Profitable Growth: Second, we are going to grow American’s network by approximately 5% in 2020 through efficient and profitable growth. A large portion of this growth will be at DFW and CLT, two of our highest margin hubs. We can add routes into these large connecting hubs and immediately produce above-average unit revenues. The DFW team has set the stage with their growth this summer, and we’re excited to build on that success. We also expect to return the 737 MAX to our schedule in early 2020, contributing to some of that growth as well.
Significant Free Cash Flow Generation: Lastly, and importantly, we will begin to produce significant free cash flow for our investors in 2020 and beyond. We have invested heavily in modernizing our fleet over the last six years. Doing so took our combined aircraft age to an average 11 years — the youngest fleet in the industry. We’ll continue to invest in our aircraft, but the heaviest of our fleet modernization investments are behind us. That will help our balance sheet and lower our debt by $8 billion to $10 billion over the next five years.
We are excited about what lies ahead in the near future and beyond and are grateful to the entire team for the great work you do. Thank you again, and let’s continue this momentum as we close out 2019.
Doug-Signature-Transparent-Background.png
Doug
Robert-Signature-New.png
Robert
Only Thing I liked was they are going start lowering the our debt 8-10billion over the next 5 years. We’ll see if that happens. Also curious how wall street will react and if Parker keeps his job.
American reports third-quarter 2019 profit
5 minute read
Created by Andrea Koos
on Oct 24, 2019 6:16 AM
In a letter to team members Oct. 24, CEO Doug Parker and President Robert Isom announced our third-quarter 2019 earnings. Read the full letter below.
Dear fellow team members,
Today we announced the company’s third-quarter earnings results. American reported revenue of $11.9 billion, 3% higher than the same period last year, and a record for the third quarter. That makes 12 consecutive quarters of improving our total revenue per available seat mile (TRASM), and we’re confident that trend will continue the rest of the year. Excluding net special items, our net profit for the quarter was $630 million, a 15% increase over the third quarter 2018. The third quarter added $52 million to the 2019 profit-sharing program, bringing the total to $139 million to be shared by American’s 130,000 team members.
Producing such strong results despite a difficult summer is due entirely to your hard work. Frontline team members have gone above and beyond to care for customers during the peak months even with operational challenges, including the ongoing grounding of our Boeing 737 MAX fleet. Thank you for your continued commitment to doing your best for our customers, no matter the circumstances.
While we are proud of these results, we know they can be better. As we near the end of 2019, we are committing to deliver on three key areas that will create value for our company in 2020:
Operational Excellence: We believe the issues that impacted our operations through much of the summer are now behind us. We had a solid September, and that strong performance has continued into October. But, two months don’t make a trend, and we won’t rely entirely on our recent performance or our forward confidence. We have specific plans in place to improve our operating reliability beyond reaching a labor agreement and specific goals that we will meet. We will not allow our team members and customers to experience another period like this past summer.
Efficient and Profitable Growth: Second, we are going to grow American’s network by approximately 5% in 2020 through efficient and profitable growth. A large portion of this growth will be at DFW and CLT, two of our highest margin hubs. We can add routes into these large connecting hubs and immediately produce above-average unit revenues. The DFW team has set the stage with their growth this summer, and we’re excited to build on that success. We also expect to return the 737 MAX to our schedule in early 2020, contributing to some of that growth as well.
Significant Free Cash Flow Generation: Lastly, and importantly, we will begin to produce significant free cash flow for our investors in 2020 and beyond. We have invested heavily in modernizing our fleet over the last six years. Doing so took our combined aircraft age to an average 11 years — the youngest fleet in the industry. We’ll continue to invest in our aircraft, but the heaviest of our fleet modernization investments are behind us. That will help our balance sheet and lower our debt by $8 billion to $10 billion over the next five years.
We are excited about what lies ahead in the near future and beyond and are grateful to the entire team for the great work you do. Thank you again, and let’s continue this momentum as we close out 2019.
Doug-Signature-Transparent-Background.png
Doug
Robert-Signature-New.png
Robert
Only Thing I liked was they are going start lowering the our debt 8-10billion over the next 5 years. We’ll see if that happens. Also curious how wall street will react and if Parker keeps his job.
#4
Gets Weekends Off
Joined APC: Jan 2014
Posts: 1,294
#5
I know they plan to expand the gate space in all the terminals. And I’ve also heard some rumor of a possible satellite terminal of sorts?
#6
Gets Weekends Off
Joined APC: Jul 2012
Posts: 154
New parking deck was a huge mistake and prevented any meaningful improvement of taxi-flow or terminal rehab/expansion. long term leases to railroad in middle of airport...Im surprised they didn’t move the show back to RDU (maybe throw another RWY in). Only 20% pax originating traffic in CLT. Its getting some lipstick in B/C but the 1950’s design has its limits operationally. Starting to feel like a big LGA, water buckets and all.
#7
Gets Weekends Off
Joined APC: Feb 2007
Posts: 2,483
Regarding CLT, I’m not a huge fan of the new giant runway to the west of the current center runway idea. Stretch the existing center runway, then drop in a 7,000 ft piece of pavement between the GA complex and Billy Graham. Put all the RJ traffic on that and you’ve massively simplified the operation.
We could immediately score some easy gains in taxi congestion if we had some 18L/36R specific transitions for all the RNAV arrivals. As it is most of the E Concourse traffic lands on the west runway and has to make the great migration to the NE corner of the airport, and each one of those aircraft takes up as much space as a 319/320/321 when it comes to taxiing.
We could immediately score some easy gains in taxi congestion if we had some 18L/36R specific transitions for all the RNAV arrivals. As it is most of the E Concourse traffic lands on the west runway and has to make the great migration to the NE corner of the airport, and each one of those aircraft takes up as much space as a 319/320/321 when it comes to taxiing.
#8
Gets Weekends Off
Joined APC: Jan 2014
Posts: 1,294
Regarding CLT, I’m not a huge fan of the new giant runway to the west of the current center runway idea. Stretch the existing center runway, then drop in a 7,000 ft piece of pavement between the GA complex and Billy Graham. Put all the RJ traffic on that and you’ve massively simplified the operation.
We could immediately score some easy gains in taxi congestion if we had some 18L/36R specific transitions for all the RNAV arrivals. As it is most of the E Concourse traffic lands on the west runway and has to make the great migration to the NE corner of the airport, and each one of those aircraft takes up as much space as a 319/320/321 when it comes to taxiing.
We could immediately score some easy gains in taxi congestion if we had some 18L/36R specific transitions for all the RNAV arrivals. As it is most of the E Concourse traffic lands on the west runway and has to make the great migration to the NE corner of the airport, and each one of those aircraft takes up as much space as a 319/320/321 when it comes to taxiing.
Thread
Thread Starter
Forum
Replies
Last Post