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AMR Posts Loss on Soaring Fuel Bill

Tags: Aerospace & Defense, AMR Corp., AMR Research, Construction, Finance, Manufacturing, Operational Accounting, Quarterly Loss

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2008-07-16 06:45:09.0

CHICAGO (Reuters) - AMR Corp (AMR), parent of American Airlines, on Wednesday posted a quarterly net loss, reversing a year-ago profit, as its fuel bill jumped 47.4 percent.

AMR's loss sets the stage for what could be a troubling string of reports from rival carriers. The industry has been battered severely by soaring fuel costs, which have risen alongside crude oil prices to a record high. Top carriers, including AMR's American, have announced sweeping capacity cuts to offset fuel costs.

The company's loss, including special charges, amounted to $1.4 billion, or $5.77 per share, compared with a profit of $317 million, or $1.08 per share, a year earlier.

Excluding one-time items, the parent of the No. 1 U.S. airline said its loss was $248 million, or $1.13 per share. That compares with Wall Street expectations for a $1.42-per-share loss, according to Reuters Estimates.

Items include a $1.1 billion non-cash accounting charge to write down the value of certain aircraft to their estimated fair value. Other charges related to capacity reductions.

Revenue rose 5.1 percent to $6.18 billion.

AMR paid $2.42 billion for fuel in the quarter, up from $1.64 billion a year earlier.

It ended the quarter with $5.5 billion in cash and short-term investments, including a restricted balance of $435 million.

Shares of AMR fell 45 percent in the second quarter, compared with the Amex airline index , which fell 39 percent in the quarter.

(Reporting by Kyle Peterson; Editing by Derek Caney)

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