American Airlines Group Inc. today reported its fourth-quarter and full-year 2022 financial results, including:

• Fourth-quarter and full-year net income of $803 million and $127 million, or $1.14 per diluted share and $0.19 per diluted share, respectively. Excluding net special items¹, fourth-quarter and full-year net income of $827 million and $328 million, or $1.17 per diluted share and $0.50 per diluted share, respectively.
• Record fourth-quarter revenue of $13.2 billion, which represents a 16.6% increase over the same period in 2019, despite flying 6.1% less capacity.
• Ended the year with $12 billion of total available liquidity, after prepaying a $1.2 billion term loan during the fourth quarter.
• Company continues to execute on its plan to pay down $15 billion of total debt² by the end of 2025.

“The American Airlines team has produced outstanding results over the past year,” said American’s CEO Robert Isom. “We committed to running a reliable operation and returning to profitability, and our team is delivering on both. We’re proud to have led the industry in operational performance over the holidays while producing record full-year and fourth-quarter revenues, resulting in a third consecutive quarterly profit and a profit for the full year. As we turn our attention to 2023, we will continue to prioritize reliability, profitability and debt reduction.”

Running a reliable operation

American and its regional partners operated more than 475,000 flights in the fourth quarter, with an average load factor of 83.9%. For the quarter, American ranked first in completion factor among the nine largest U.S. carriers.

The American team delivered an even stronger performance over the holidays, despite challenging conditions in many parts of the country. American outperformed the industry over the December holiday period, ranking first in completion factor. The momentum has continued into 2023 as American has delivered the best on-time arrival performance of the nine largest U.S. carriers so far this year.

Returning to profitability

American produced revenues of $13.2 billion in the fourth quarter, an increase of 16.6% versus the same period in 2019 and the highest fourth-quarter revenue in company history, driven by the continued strength of the demand environment. This record revenue was achieved while flying 6.1% less capacity than the same period in 2019. On both a GAAP basis and excluding the impact of net special items, the company produced an operating margin of 10.5% in the quarter. American also produced record revenues of $49 billion for the full year, resulting in full-year profitability.

Liquidity and balance sheet

In the fourth quarter, American made approximately $539 million in debt and finance lease payments and prepaid a $1.2 billion term loan. The company ended the year with $12 billion of total available liquidity, comprised of cash and short-term investments plus undrawn capacity under revolving and other credit facilities. Total debt² reduction continues to be a top priority, and the company is more than halfway to its goal of reducing total debt by $15 billion by the end of 2025. As of Dec. 31, 2022, American had reduced its total debt by more than $8 billion from peak levels in the second quarter of 2021.

Guidance and investor update

Based on demand trends and the current fuel price forecast and excluding the impact of special items, the company expects its first-quarter 2023 adjusted earnings per diluted share³ to be approximately breakeven. Based on today’s guidance, American expects its full-year 2023 adjusted earnings per diluted share³ to be between $2.50 and $3.50.

Notes

See the accompanying notes in the financial tables section of this press release for further explanation, including a reconciliation of all GAAP to non-GAAP financial information.

1. The company recognized $24 million of net special items after the effect of taxes in the fourth quarter, which principally included mark-to-market net unrealized losses associated with certain equity investments.
2. All references to total debt include debt, finance leases, operating lease liability and pension obligations.
3. Adjusted earnings per diluted share guidance excludes the impact of net special items. The company is unable to reconcile certain forward-looking projections to GAAP as the nature or amount of net special items cannot be determined at this time.

Top Copyright Photo: American Airlines Boeing 737-823 WL N997NN (msn 33250) LAX (Michael B. Ing). Image: 959831.

American Airlines aircraftb photo gallery (Boeing):