AE Revenues Down, Continental Express Up

AE in Loss at AMR American Eagle operations contributed $2.470 billion to AMR’s operating revenues in 2007, down 1.5 percent while expenses rose from $2.675 billion in 2006 to $2.8 billion during 2007. For the fourth quarter, during which AMR announced its intentions to sell its regional operations...

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AE in Loss at AMR
American Eagle operations contributed $2.470 billion to AMR’s operating revenues in 2007, down 1.5 percent while expenses rose from $2.675 billion in 2006 to $2.8 billion during 2007. For the fourth quarter, during which AMR announced its intentions to sell its regional operations, regional affiliates contributed $606 million, up 3.2 percent. However, expenses also rose from $654 million in the year-ago period to $717 million, at a time when the carrier is trying to cut costs and when fuel costs are consistently growing. Related Story
During its investor’s conference Gerard Arpey said the company has yet to decide the form the spin off will take but said it is scheduled for the second half. Given the industry consolidation activity, analysts naturally asked if the spin off would be postponed, but Arpey said it would not.
AMR posted a net profit of $504 million, or $1.78 per diluted share the first back-to-back annual profit since the 1999-2000 period. For all of 2007, AMR’s full-year 2007 results compare to a net profit of $231 million net profit, or $0.98 per diluted share, for all of 2006.
AMR Corporation, reported a net loss of $69 million for the fourth quarter of 2007, or $0.28 per share ending a six-quarter string of profitability. The company cited punishing fuel costs as well as record breaking bad weather last year. It said it would be very cautious on it 2008 capacity plans. Regional affiliates flew 2.380 billion revenue passenger miles in Q4, down 2.9 percent, while available seat miles dropped two percent to 3.318 billion. Load factor dropped slightly to 71.7 percent, down 0.7 points. For the year, they flew 9.8 billion RPMs, down 1.2 percent, while ASMs dropped one percent to 13.4 billion and load factor dropped 0.2 points to 73.4 percent.

Continental Express Rev Up, ASMs Down
Despite pulling back on its regional operations, during the year, Continental’s Express partners contributed $552 million in the fourth quarter, up 3.5 percent, while revenue per available seat mile rose 9.8 percent to 17.80 cents and ASMs dropped 5.7 percent to 3.1 billion. Express partners posted revenues of approximately $2.2 billion for the year-end 2007. Regional capacity purchase agreements cost the major carrier $474 million, up 5.8 percent in Q4, while expenses for the year were flat at 0.1 percent growth to $1.793 billion.
Passengers flown by ExpressJet, Chautauqua and CommutAir grew 3.2 percent in the fourth quarter to 4.421 million but were down two percent for the year at 17.9 million. RPMs dropped 5.6 percent to 2.4 billion in the quarter and 4.5 percent to 9.8 billion for the year. ASMs for the year dropped 4.9 percent to 12.5 billion when its fleet dropped 6.7 percent to 263 aircraft. Load factor was flat at 0.1 point growth to 77.3 percent for the quarter and up 0.3 points to 78.2 percent for the year. RASM for the year increased 1.9 percent to 17.48 cents. Yield rose 9.7 percent to 23.3 cents for the quarter and 1.5 percent to 22.35 cents for the year.
Continental Airlines reported 2007 pre-tax income of $566 million, up 53 percent over 2006 pre-tax income of $369 million. Excluding $24 million of previously announced pre-tax special items, Continental's pre-tax income for the full year was $542 million, a 78 percent improvement over 2006 pre-tax income of $304 million excluding special items.
Continental reported pre-tax income of $71 million for the fourth quarter 2007. Excluding previously announced pre-tax special items, Continental recorded fourth quarter 2007 pre-tax income of $24 million compared to the fourth quarter 2006 pre-tax loss of $4 million excluding special items.