American Airlines reported a third-quarter loss of more than $3 billion and losses of $8.6 billion for the nine months to September yesterday.
The carrier reported “improvements in passenger demand and load factors during the third quarter”. But American said capacity for the remainder of the year would be “down more than 50% year over year, with long-haul international capacity down 75%”.
American’s third-quarter revenue was down 73% year on year while passenger revenue fell 77%. Passenger revenue for the year to date was down by almost two-thirds.
The carrier’s operating costs for the nine months to September totalled more than $21 billion despite it cutting an estimated $17 billion in spending, with revenues lagging at just over $13 billion.
However, the nine-month loss was reduced to $6.7 billion after tax provisions
The carrier ended September with $13.6 billion in available liquidity and noted it increased this by $2 billion in October by extending its loan capacity through the US Federal CARES Act to $7.5 billion.
American, the transatlantic partner of British Airways and Iberia, announced plans to bolster its liquidity further by issuing up to $1 billion in equity.
Chairman and chief executive Doug Parker said: “We took action to reduce our costs, strengthen our financial position and ensure our customers return to travel with confidence during the third quarter.
“We have a long road ahead, [but] we’re confident the continued efforts of our team and the actions we have taken will drive customer confidence and strengthen our company for the future.”
The airline has removed more than 150 aircraft from its fleet, deferred deliveries for 18 737 MAX aircraft to beyond 2024, and finalised a series of sale and leaseback transactions to finance planned deliveries from Airbus in 2021.
More than 20,000 employees have taken voluntary redundancy or long-term leave and 19,000 more were furloughed from October 1.
American said it had reduced its daily cash burn to about $44 million, down from $58 million in the second quarter, and forecast this would fall below $30 million a day for the remainder of the year.