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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X]Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the Quarterly Period Ended March 31, 2004.
[ ]Transition Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the Transition Period From to .
Commission file number 1-8400.
AMR Corporation
(Exact name of registrant as specified in its charter)
Delaware 75-1825172
(State or other (I.R.S. Employer
jurisdiction Identification No.)
of incorporation or
organization)
4333 Amon Carter Blvd.
Fort Worth, Texas 76155
(Address of principal (Zip Code)
executive offices)
Registrant's telephone number, (817) 963-1234
including area code
Not Applicable
(Former name, former address and former fiscal year , if changed
since last report)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No .
Indicate by check mark whether the registrant is an accelerated
filer (as defined in Exchange Act Rule 12b-2). Yes X No .
Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable
date.
Common Stock, $1 par value - 159,625,464 shares as of April 16, 2004.
INDEX
AMR CORPORATION
PART I: FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Statements of Operations -- Three months ended March
31, 2004 and 2003
Condensed Consolidated Balance Sheets -- March 31, 2004 and
December 31, 2003
Condensed Consolidated Statements of Cash Flows -- Three months
ended March 31, 2004 and 2003
Notes to Condensed Consolidated Financial Statements -- March 31, 2004
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
Item 3. Quantitative and Qualitative Disclosures about Market Risk
Item 4. Controls and Procedures
PART II: OTHER INFORMATION
Item 1. Legal Proceedings
Item 6. Exhibits and Reports on Form 8-K
SIGNATURE
PART I: FINANCIAL INFORMATION
Item 1. Financial Statements
AMR CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited) (In millions, except per share amounts)
Three Months Ended
March 31,
2004 2003
Revenues
Passenger - American Airlines $ 3,678 $ 3,394
- Regional Affiliates 420 326
Cargo 148 134
Other revenues 266 266
Total operating revenues 4,512 4,120
Expenses
Wages, salaries and benefits 1,640 2,098
Aircraft fuel 808 729
Depreciation and amortization 326 338
Other rentals and landing fees 305 291
Commissions, booking fees and credit
card expense 288 255
Maintenance, materials and repairs 231 231
Aircraft rentals 153 190
Food service 137 149
Other operating expenses 582 683
Special charges - 25
Total operating expenses 4,470 4,989
Operating Income (Loss) 42 (869)
Other Income (Expense)
Interest income 14 13
Interest expense (212) (192)
Interest capitalized 18 19
Miscellaneous - net (28) (14)
(208) (174)
Loss Before Income Taxes (166) (1,043)
Income tax - -
Net Loss $ (166) $ (1,043)
Basic and Diluted Loss Per Share $ (1.03) $ (6.68)
The accompanying notes are an integral part of these financial statements.
-1-
AMR CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited) (In millions)
March 31, December 31,
2004 2003
Assets
Current Assets
Cash $ 152 $ 120
Short-term investments 3,074 2,486
Restricted cash and short-term investments 501 527
Receivables, net 965 796
Inventories, net 490 516
Other current assets 224 237
Total current assets 5,406 4,682
Equipment and Property
Flight equipment, net 15,264 15,319
Other equipment and property, net 2,383 2,411
Purchase deposits for flight equipment 356 359
18,003 18,089
Equipment and Property Under Capital Leases
Flight equipment, net 1,266 1,284
Other equipment and property, net 84 87
1,350 1,371
Route acquisition costs and airport operating
and gate lease rights, net 1,245 1,253
Other assets 3,946 3,935
$ 29,950 $ 29,330
Liabilities and Stockholders' Equity (Deficit)
Current Liabilities
Accounts payable $ 1,022 $ 967
Accrued liabilities 2,072 1,989
Air traffic liability 3,201 2,799
Current maturities of long-term debt 619 603
Current obligations under capital leases 196 201
Total current liabilities 7,110 6,559
Long-term debt, less current maturities 12,403 11,901
Obligations under capital leases, less
current obligations 1,174 1,225
Pension and postretirement benefits 4,720 4,803
Other liabilities, deferred gains and
deferred credits 4,678 4,796
Stockholders' Equity (Deficit)
Preferred stock - -
Common stock 182 182
Additional paid-in capital 2,597 2,605
Treasury stock (1,395) (1,405)
Accumulated other comprehensive loss (802) (785)
Retained deficit (717) (551)
(135) 46
$ 29,950 $ 29,330
The accompanying notes are an integral part of these financial statements.
-2-
AMR CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited) (In millions)
Three Months Ended
March 31,
2004 2003
Net Cash Provided (Used) by Operating Activities $ 371 $ (537)
Cash Flow from Investing Activities:
Capital expenditures, including purchase
deposits for flight equipment (213) (229)
Net (increase) decrease in short-term investments (588) 731
Net decrease in restricted cash and short-term
investments 26 233
Proceeds from sale of equipment and property 18 29
Other (12) 23
Net cash (used) provided by investing activities (769) 787
Cash Flow from Financing Activities:
Payments on long-term debt and capital lease
obligations (199) (247)
Proceeds from:
Issuance of long-term debt 627 50
Exercise of stock options 2 -
Net cash provided (used) by financing activities 430 (197)
Net increase in cash 32 53
Cash at beginning of period 120 104
Cash at end of period $ 152 $ 157
Activities Not Affecting Cash
Flight equipment acquired through seller financing $ 18 $ 164
The accompanying notes are an integral part of these financial statements.
-3-
AMR CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1.The accompanying unaudited condensed consolidated financial
statements have been prepared in accordance with generally accepted
accounting principles for interim financial information and with the
instructions to Form 10-Q and Article 10 of Regulation S-X.
Accordingly, they do not include all of the information and footnotes
required by generally accepted accounting principles for complete
financial statements. In the opinion of management, these financial
statements contain all adjustments, consisting of normal recurring
accruals unless otherwise disclosed, necessary to present fairly the
financial position, results of operations and cash flows for the
periods indicated. Results of operations for the periods presented
herein are not necessarily indicative of results of operations for the
entire year. The condensed consolidated financial statements include
the accounts of AMR Corporation (AMR or the Company) and its wholly
owned subsidiaries, including its principal subsidiary American
Airlines, Inc. (American). For further information, refer to the
consolidated financial statements and footnotes thereto included in
the AMR Annual Report on Form 10-K for the year ended December 31,
2003 (2003 Form 10-K). Certain amounts have been reclassified to
conform with the 2004 presentation.
2.The Company accounts for its stock-based compensation plans in
accordance with Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees" (APB 25) and related
Interpretations. Under APB 25, no compensation expense is
recognized for stock option grants if the exercise price of the
Company's stock option grants is at or above the fair market value
of the underlying stock on the date of grant. The Company has
adopted the pro forma disclosure features of Statement of Financial
Accounting Standards No. 123, "Accounting for Stock-Based
Compensation" (SFAS 123), as amended by Statement of Financial
Accounting Standards No. 148, "Accounting for Stock-Based
Compensation-Transition and Disclosure." The following table
illustrates the effect on net loss and loss per share amounts if
the Company had applied the fair value recognition provisions of
SFAS 123 to stock-based employee compensation (in millions, except
per share amounts):
Three Months Ended March 31,
2004 2003
Net loss, as reported $(166) $(1,043)
Add: Stock-based employee compensation
expense included in reported net loss 11 (3)
Deduct: Total stock-based employee
compensation expense determined under
fair value based methods for all awards (27) (7)
Pro forma net loss $(182) $(1,053)
Loss per share:
Basic and diluted - as reported $(1.03) $(6.68)
Basic and diluted - pro forma $(1.14) $(6.74)
3.As of March 31, 2004, the Company had commitments to acquire:
27 Embraer regional jets and five Bombardier CRJ-700 regional jets
in 2004; an aggregate of 38 Embraer regional jets in 2005 and 2006;
and an aggregate of 47 Boeing 737-800s and nine Boeing 777-200ERs
in 2006 through 2010. Future payments for all aircraft, including
the estimated amounts for price escalation, will approximate $576
million during the remainder of 2004, $699 million in 2005, $685
million in 2006 and an aggregate of approximately $2.0 billion in
2007 through 2010. The Company has pre-arranged financing or
backstop financing for all of its regional jet aircraft deliveries
through mid-July 2005. These deliveries include the remaining 32
aircraft in 2004 and 20 aircraft in 2005.
-4-
AMR CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(Unaudited)
The Company is subject to environmental issues at various airport
and non-airport locations for which it has accrued, in Accrued
liabilities on the accompanying condensed consolidated balance
sheets, $75 million and $72 million at March 31, 2004 and December
31, 2003, respectively. Management believes, after considering a
number of factors, that the ultimate disposition of these
environmental issues is not expected to materially affect the
Company's consolidated financial position, results of operations or
cash flows. Amounts recorded for environmental issues are based on
the Company's current assessments of the ultimate outcome and,
accordingly, could increase or decrease as these assessments
change.
In 2003, the Company reached concessionary agreements with certain
lessors. Certain of these agreements provide that the Company's
obligations under the related leases revert to the original terms
if certain events occur prior to December 31, 2005, including: (i)
an event of default under the related lease (which generally occurs
only if a payment default occurs), (ii) an event of loss with
respect to the related aircraft, (iii) rejection by the Company of
the lease under the provisions of Chapter 11 of the U.S. Bankruptcy
Code or (iv) the Company's filing for bankruptcy under Chapter 7 of
the U.S. Bankruptcy Code. If any one of these events were to
occur, the Company would be responsible for approximately $45
million in additional operating lease payments and $65 million in
additional payments related to capital leases as of March 31, 2004.
This amount will increase to approximately $119 million in
operating lease payments and $111 million in payments related to
capital leases prior to the expiration of the provision on December
31, 2005. These amounts are being accounted for as contingent
rentals and will only be recognized if they become payable.
Financial Accounting Standards Board Interpretation No. 45,
"Guarantor's Accounting and Disclosure Requirements for Guarantees,
Including Indirect Guarantees of Indebtedness of Others"
(Interpretation 45), requires disclosures in interim and annual
financial statements about obligations under certain guarantees
issued by the Company. The disclosures required by Interpretation
45 were included in Notes 4, 5 and 6 to the consolidated financial
statements in the 2003 Form 10-K. There have been no significant
changes to such disclosures.
4.Accumulated depreciation of owned equipment and property at March
31, 2004 and December 31, 2003 was $8.7 billion and $8.5 billion,
respectively. Accumulated amortization of equipment and property
under capital leases at March 31, 2004 and December 31, 2003 was
$1.1 billion.
5.As discussed in Note 8 to the consolidated financial statements in
the 2003 Form 10-K, the Company has a valuation allowance against
the full amount of its net deferred tax asset. The Company's
deferred tax asset valuation allowance increased $65 million during
the three months ended March 31, 2004 to $728 million as of March
31, 2004.
6.During the three-month period ended March 31, 2004, AMR Eagle
borrowed approximately $146 million (net of discount), under
various debt agreements, related to the purchase of regional jet
aircraft, including certain seller financed agreements. These debt
agreements are secured by the related aircraft, have interest rates
which are either fixed or variable based on LIBOR plus a spread,
and mature over various periods of time through 2020. As of March
31, 2004, the effective interest rates on these agreements range up
to 4.75 percent. These debt agreements are guaranteed by AMR.
In addition, in February 2004, American issued $180 million of
Fixed Rate Secured Notes due 2009. These notes are secured by
certain spare parts (with a net book value of $224 million as of
March 31, 2004) and bear interest at 7.25 percent.
-5-
AMR CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(Unaudited)
Also in February 2004, the Company issued $324 million principal
amount of 4.50 percent senior convertible notes due 2024. Each note
is convertible into AMR common stock at a conversion rate of
45.3515 shares per $1,000 principal amount of notes (which
represents an equivalent conversion price of $22.05 per share),
subject to adjustment in certain circumstances. The notes are
convertible under certain circumstances, including if (i) the
closing sale price of the Company's common stock reaches a certain
level for a specified period of time, (ii) the trading price of the
notes as a percentage of the closing sale price of the Company's
common stock falls below a certain level for a specified period of
time, (iii) the Company calls the notes for redemption, or (iv)
certain corporate transactions occur. Holders of the notes may
require the Company to repurchase all or any portion of the notes
on February 15, 2009, 2014 and 2019 at a purchase price equal to
the principal amount of the notes being purchased plus accrued and
unpaid interest to the date of purchase. The Company may pay the
purchase price in cash, common stock or a combination of cash and
common stock. After February 15, 2009, the Company may redeem all
or any portion of the notes for cash at a price equal to the
principal amount of the notes being redeemed plus accrued and
unpaid interest as of the redemption date. These notes are
guaranteed by American. If the holders of these notes or the 4.25
percent senior convertible notes due 2023 require the Company to
repurchase all or any portion of the notes on the repurchase dates,
it is the Company's present intention to satisfy the requirement in
cash.
As of March 31, 2004, AMR has issued guarantees covering
approximately $932 million of American's tax-exempt bond debt and
American has issued guarantees covering approximately $1.3 billion
of AMR's unsecured debt. In addition, as of March 31, 2004, AMR
and American have issued guarantees covering approximately $484
million of AMR Eagle's secured debt, and AMR has issued guarantees
covering an additional $2.1 billion of AMR Eagle's secured debt.
7.The following table provides the components of net periodic
benefit cost for the three months ended March 31, 2004 and 2003 (in
millions):
Other Postretirement
Pension Benefits Benefits
2004 2003 2004 2003
Components of net periodic
benefit cost
Service cost $ 89 $ 109 $ 19 $ 24
Interest cost 142 152 51 56
Expected return on assets (142) (118) (3) (2)
Amortization of:
Prior service cost 4 7 (3) (2)
Unrecognized net loss 14 32 2 5
Net periodic benefit cost $ 107 $ 182 $ 66 $ 81
The Company expects to contribute a minimum of approximately $433
million and $412 million to its defined benefit pension plans in
2004 and 2005, respectively. The Company's estimates of its defined
benefit pension plan contributions reflect the provisions of the
Pension Funding Equity Act of 2004, which was enacted in April
2004. Of the $433 million minimum amount the Company expects to
contribute to its defined benefit pension plans in 2004, the
Company contributed approximately $213 million during the three
months ended March 31, 2004 and an additional $106 million on April
15, 2004.
-6-
AMR CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(Unaudited)
In December 2003, the President signed the Medicare Prescription
Drug, Improvement and Modernization Act of 2003 (the Modernization
Act), which introduces a prescription drug benefit under Medicare
into law. In January 2004, the Financial Accounting Standards Board
(FASB) issued a FASB Staff Position which permits companies to
elect to defer accounting for the effects of the Modernization Act.
The Company has not elected this deferral and has recognized the
effect of the Modernization Act in the calculation of its
postretirement benefit liability as of December 31, 2003. The
effect of the Modernization Act was to reduce the Company's
accumulated postretirement benefit obligation (APBO) by $415
million by decreasing unrecognized net actuarial losses. This
decrease is due to a reduction in the expected per capita claims
cost along with a reduction in the expected rates of participation
in the plan. The decrease in the APBO is reflected in the Company's
2004 postretirement benefits expense through amortization of
unrecognized gains/losses. Additionally, the service and interest
cost components of the Company's 2004 postretirement benefits
expense have been reduced as a result of the Modernization Act. The
effect of the Modernization Act was to decrease the Company's full
year 2004 postretirement benefits expense by approximately $60
million. Final authoritative guidance on accounting for the
Modernization Act has not been issued and could require the Company
to change previously reported information.
8.During the last three years, as a result of the events of
September 11, 2001 and the Company's continuing restructuring
activities, the Company has recorded a number of special charges
related to aircraft charges, facility exit costs and employee charges.
Special charges for the three months ended March 31, 2003 included
employee severance charges related to the Company's 2002 restructuring
initiatives. The following table summarizes the changes in the
remaining accruals for these charges (in millions):
Aircraft Facility Exit Employee
Charges Costs Charges Total
Remaining accrual
at December 31, 2003 $ 197 $ 56 $ 26 $ 279
Payments (27) (2) (4) (33)
Remaining accrual
at March 31, 2004 $ 170 $ 54 $ 22 $ 246
Cash outlays related to the accruals, as of March 31, 2004, for
aircraft charges, facility exit costs and employee charges will
occur through 2014, 2018 and 2004, respectively.
9.The Company includes changes in the fair value of certain
derivative financial instruments that qualify for hedge accounting,
changes in minimum pension liabilities and unrealized gains and
losses on available-for-sale securities in comprehensive loss. For
the three months ended March 31, 2004 and 2003, comprehensive loss
was $183 million and $1.1 billion, respectively. The difference
between net loss and comprehensive loss for the three months ended
March 31, 2004 and 2003 is due primarily to the accounting for the
Company's derivative financial instruments.
-7-
AMR CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(Unaudited)
10.The following table sets forth the computations of basic and
diluted loss per share (in millions, except per share data):
Three Months Ended
March 31,
2004 2003
Numerator:
Net loss - numerator for basic and diluted
loss per share $ (166) $ (1,043)
Denominator:
Denominator for basic and diluted loss per
share - weighted-average shares 160 156
Basic and diluted loss per share $(1.03) $ (6.68)
For the three months ended March 31, 2004, approximately 26 million
shares were not added to the denominator because inclusion of such
shares would be antidilutive. In addition, for the three months
ended March 31, 2004, approximately 32 million shares issuable upon
conversion of the Company's 4.50 percent convertible notes
(discussed in Note 6) and its 4.25 percent convertible notes were
not added to the denominator because the contingent conversion
conditions have not been met. For the three months ended March 31,
2003, shares excluded from the denominator because inclusion of
such shares would be antidilutive were insignificant.
-8-
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
Forward-Looking Information
Statements in this report contain various forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, which represent the Company's expectations or beliefs
concerning future events. When used in this document and in documents
incorporated herein by reference, the words "expects," "plans,"
"anticipates," "believes," and similar expressions are intended to
identify forward-looking statements. Forward-looking statements
include, without limitation, the Company's expectations concerning
operations and financial conditions, including changes in capacity,
revenues, and costs, future financing needs, overall economic
conditions, plans and objectives for future operations, and the impact
on the Company of its results of operations for the past three years
and the sufficiency of its financial resources to absorb that impact.
Other forward-looking statements include statements which do not
relate solely to historical facts, such as, without limitation,
statements which discuss the possible future effects of current known
trends or uncertainties, or which indicate that the future effects of
known trends or uncertainties cannot be predicted, guaranteed or
assured. All forward-looking statements in this report are based upon
information available to the Company on the date of this report. The
Company undertakes no obligation to publicly update or revise any
forward-looking statement, whether as a result of new information,
future events, or otherwise. Forward-looking statements are subject
to a number of risk factors that could cause actual results to differ
materially from our expectations. The following factors, in addition
to other possible factors not listed, could cause the Company's actual
results to differ materially from those expressed in forward-looking
statements: changes in economic, business and financial conditions;
the Company's substantial indebtedness; high fuel prices and the
availability of fuel; the residual effects of the war in Iraq;
conflicts in the Middle East or elsewhere; the highly competitive
business environment faced by the Company, with increasing competition
from low cost carriers and historically low fare levels; the ability
of the Company to implement its restructuring program and the effect
of the program on operational performance and service levels;
uncertainties with respect to the Company's international operations;
changes in the Company's business strategy; actions by U.S. or foreign
government agencies; the possible occurrence of additional terrorist
attacks; another outbreak of a disease (such as SARS) that affects
travel behavior; uncertainties with respect to the Company's
relationships with unionized and other employee work groups; the
inability of the Company to satisfy existing financial or other
covenants in certain of its credit agreements; the availability of
future financing; and increased insurance costs and potential
reductions of available insurance coverage. Additional information
concerning these and other factors is contained in the Company's
Securities and Exchange Commission filings, including but not limited
to the Company's Annual Report on Form 10-K for the year ended
December 31, 2003.
Overview
AMR's net loss was $166 million for the first quarter of 2004, an
improvement of $877 million over its $1.0 billion net loss for the
first quarter of 2003. AMR's operating income was $42 million for the
first quarter of 2004, an improvement of $911 million over its
operating loss of $869 million for the first quarter of 2003.
The year-over-year improvement in the Company's operating results
reflects the benefit of the cost reduction initiatives in the
Company's restructuring program, which is described more fully under
Item 7, "Management's Discussion and Analysis of Financial Condition
and Results of Operations" in the Company's Annual Report on Form 10-K
for the year ended December 31, 2003. In addition, passenger traffic
(revenue passenger miles) in the first quarter of 2004 exceeded the
Company's expectations, reflecting continuing improvement in the U.S.
economy and increasing demand for air travel. However, yield and unit
revenues (passenger revenues per available seat mile) remain depressed
relative to historical measures because of the Company's reduced
pricing power, resulting mainly from greater cost sensitivity on the
part of travelers, especially business travelers, and intensifying
competition arising in part from the growth of low-cost carriers and
in part from the effects of significant increases in overall industry
capacity in 2004. In addition, fuel prices remained high relative to
the past several years.
-9-
The Company continues to need to see improvement in the revenue
environment, additional cost reductions and further productivity
improvements before it can return to sustained profitability at
acceptable levels. In addition, the Company's ability to return to
sustained profitability at acceptable levels will depend on a number
of risk factors, many of which are largely beyond the Company's
control. Some of the risk factors that have had and/or may have a
negative impact on the Company's business and financial results are
referred to under "Forward-Looking Information" above and are
discussed in the Risk Factors listed in Item 7 (on pages 36-38) in the
Company's Annual Report on Form 10-K for the year ended December 31,
2003. In particular, if the revenue environment deteriorates beyond
normal seasonal trends, or the Company is unable to access the capital
markets to raise additional capital, it may be unable to fund its
obligations and sustain its operations in the long-term.
LIQUIDITY AND CAPITAL RESOURCES
Significant Indebtedness and Future Financing
During 2001, 2002 and 2003, the Company raised an aggregate of
approximately $10.0 billion of financing mostly to fund capital
commitments (mainly for aircraft and ground properties) and operating
losses. During the three months ended March 31, 2004, the Company
raised an additional $645 million of financing to fund capital
commitments and for general corporate purposes, and ended the quarter
with $3.2 billion of unrestricted cash and short-term investments. The
Company believes that it has sufficient liquidity to fund its
operations for the foreseeable future, including capital expenditures
and other contractual obligations. However, to maintain sufficient
liquidity over the long-term as the Company seeks to return to
sustained profitability at acceptable levels, the Company will need
continued access to additional funding. The Company's possible future
financing sources include: (i) a limited amount of additional secured
aircraft debt (virtually all of the Company's Section 1110-eligible
aircraft are encumbered), (ii) debt secured by other assets, (iii)
securitization of future operating receipts, (iv) sale-leaseback
transactions of owned aircraft, (v) the potential sale of certain non-
core assets, (vi) unsecured debt and (vii) equity and/or equity-like
securities. However, the availability and level of these financing
sources cannot be assured, particularly in light of the fact that the
Company has fewer unencumbered assets available than it has had in the
past.
The Company's significant indebtedness could have important future
consequences, such as (i) limiting the Company's ability to obtain
additional financing for working capital, capital expenditures,
acquisitions and general corporate purposes, (ii) requiring the
Company to dedicate a substantial portion of its cash flow from
operations to payments on its indebtedness, (iii) making the Company
more vulnerable to economic downturns, (iv) limiting its ability to
withstand competitive pressures and reducing its flexibility in
responding to changing business and economic conditions, and (v)
limiting the Company's flexibility in planning for, or reacting to,
changes in its business and the industry in which it operates.
Credit Facility Covenants
American has a fully drawn $834 million bank credit facility secured
by aircraft that expires December 15, 2005, which contains a liquidity
covenant and an EBITDAR (generally, earnings before interest, taxes,
depreciation, amortization and rentals, adjusted for certain non-cash
items) to fixed charges (generally, interest and total rentals) ratio
covenant. The required EBITDAR to fixed charges ratio was 1.1 to 1.0
for the three-month period ending March 31, 2004, and increases on a
quarterly basis up to 1.5 to 1.0 for each four consecutive quarters
ending after December 31, 2004. The liquidity covenant requires
American to maintain a minimum level of $1.0 billion of unrestricted
cash and short-term investments. The Company was in compliance with
these covenants as of March 31, 2004 and expects to be able to
continue to comply with these covenants. However, there are no
assurances that it will continue to be able to do so through the
expiration of the facility. Failure to comply with these covenants
would result in a default under this facility and could result in a
default under a significant amount of the Company's other debt.
-10-
Financing Activity
The Company, or its subsidiaries, issued the following debt during the
three months ended March 31, 2004 (in millions):
7.25% secured notes due 2009 $ 180
4.50% senior convertible notes due 2024
(net of discount) 319
Various debt agreements related to the
purchase of regional jet aircraft
(effective interest rates ranging up to
4.75%) (various maturities through 2020)
(net of discount) 146
$ 645
See Note 6 to the accompanying condensed consolidated financial
statements for additional information regarding the debt issuances
listed above.
Other Operating and Investing Activities
The Company's cost savings initiatives resulted in improved cash flow
from operations during the three months ended March 31, 2004, compared
to the same period in 2003. Net cash provided by operating activities
in the three-month period ended March 31, 2004 was $371 million, an
increase of $908 million over the same period in 2003. Net cash used
for operating activities for the three months ended March 31, 2003
included the receipt of a $572 million federal tax refund offset by
$216 million of redemption payments under operating leases for special
facility revenue bonds.
Capital expenditures for the first three months of 2004 were $231
million, $18 million of which was seller financed, and included the
acquisition of nine Embraer 145 and one Bombardier CRJ-700 aircraft.
Pension Funding Obligation
The Company expects to contribute a minimum of approximately $433
million and $412 million to its defined benefit pension plans in 2004
and 2005, respectively. The Company's estimates of its defined benefit
pension plan contributions reflect the provisions of the Pension
Funding Equity Act of 2004, which was enacted in April 2004. Of the
$433 million minimum amount the Company expects to contribute to its
defined benefit pension plans in 2004, the Company contributed
approximately $213 million during the three months ended March 31,
2004 and an additional $106 million on April 15, 2004.
-11-
RESULTS OF OPERATIONS
For the Three Months Ended March 31, 2004 and 2003
Revenues
The Company's revenues increased approximately $392 million, or 9.5
percent, to $4.5 billion in the first quarter of 2004 from the same
period last year. American's passenger revenues increased by 8.4
percent, or $284 million, on a capacity (available seat mile) (ASM)
increase of 5.8 percent. American's passenger load factor increased
2.0 points to 71.1 percent while passenger revenue yield per passenger
mile decreased by 0.4 percent to 12.14 cents. This resulted in an
increase in revenue per available seat mile (RASM) of 2.5 percent to
8.64 cents. Following is additional information regarding American's
domestic and international RASM and capacity:
Three Months Ended March 31, 2004
RASM Y-O-Y ASMs Y-O-Y
(cents) Change (billions) Change
Domestic 8.53 1.3% 29.5 2.5%
International 8.86 5.2 13.1 13.9
Latin America 9.40 (0.2) 7.1 21.8
Europe 8.21 8.0 4.9 5.8
Pacific 8.36 25.1 1.1 6.1
Regional affiliates' passenger revenues, which are based on industry
standard mileage proration agreements for flights connecting to
American flights, increased $94 million, or 28.8 percent, to $420
million as a result of increased capacity and load factors. Regional
affiliates' traffic increased 32.1 percent to 1.5 billion revenue
passenger miles (RPMs), while capacity increased 23.5 percent to 2.5
billion ASMs, resulting in a 4.1 point increase in the passenger load
factor to 62.7 percent.
Cargo revenues increased 10.4 percent, or $14 million, due to a 6.3
percent increase in cargo ton miles and a 4.0 percent increase in
cargo revenue yield per ton mile.
Operating Expenses
The Company's total operating expenses decreased 10.4 percent, or $519
million, to $4.5 billion in the first quarter of 2004 compared to the
first quarter of 2003. American's mainline operating expenses per ASM
in the first quarter of 2004 decreased 16.7 percent compared to the
first quarter of 2003 to 9.49 cents. These decreases are due
primarily to the Company's cost savings initiatives. The decrease in
operating expenses occurred despite a 7.4 percent increase in
American's price per gallon of fuel in the first quarter of 2004
relative to the first quarter of 2003. The Company's operating and
financial results are significantly affected by the price and
availability of jet fuel. Additional increases in the price of fuel,
or limits in the supply of fuel, would adversely affect the Company's
financial condition and results of operations.
-12-
(in millions) Three Months
Ended Change from Percentage
Operating Expenses March 31,2004 2003 Change
Wages, salaries and benefits $ 1,640 $(458) (21.8)% (a)
Aircraft fuel 808 79 10.8 (b)
Depreciation and amortization 326 (12) (3.6)
Other rentals and landing fees 305 14 4.8
Commissions, booking fees
and credit card expense 288 33 12.9 (c)
Maintenance, materials and
repairs 231 - -
Aircraft rentals 153 (37) (19.5) (d)
Food service 137 (12) (8.1)
Other operating expenses 582 (101) (14.8) (e)
Special charges - (25) NM (f)
Total operating expenses $ 4,470 $(519) (10.4)%
(a)Wages, salaries and benefits decreased primarily due to lower
wage rates and reduced headcount primarily as a result of the Labor
Agreements and Management Reductions, discussed in the Company's 2003
Form 10-K, which became effective in the second quarter of 2003.
(b)Aircraft fuel expense increased primarily due to a 7.4 percent
increase in American's price per gallon of fuel (net of the impact of
fuel hedging) and a 2.2 percent increase in American's fuel
consumption.
(c)Commissions, booking fees and credit card expense increased due
primarily to a 10.2 percent increase in the Company's passenger
revenues, particularly the 19.7 percent increase in American's
international passenger revenue.
(d)Aircraft rentals decreased due primarily to the removal of leased
aircraft from the fleet in the second half of 2003 as part of the
Company's restructuring initiatives and concessionary agreements with
certain lessors, which reduced future lease payment amounts and
resulted in the conversion of 30 operating leases to capital leases in
the second quarter of 2003.
(e)Other operating expenses decreased primarily due to decreases in
(i) technical and professional fees of $38 million, (ii) data
processing expenses of $16 million due primarily to introducing
further efficiencies into data processing environments resulting in
reduced consumption, and negotiating more favorable terms with vendors
in the second quarter of 2003; (iii) travel and incidental costs of
$11 million due primarily to decreased overnight stays for pilots and
flight attendants as a result of changes in the scheduling of flights,
lower average hotel rates, work rule changes and lower per diem
reimbursements; and increases in (iv) gains (or decreases in losses)
on disposal of assets of $23 million and (v) foreign exchange gains in
the first quarter of 2004 of $15 million.
(f)Special charges for 2003 included $25 million in severance
charges related to the Company's 2002 restructuring initiatives.
Other Income (Expense)
Other income (expense), historically a net expense, increased $34
million due primarily to the following: Interest expense increased
$20 million, or 10.4 percent, resulting primarily from the increase
in the Company's long-term debt. Miscellaneous-net increased $14 million,
due primarily to the accrual during the first quarter of 2004 of a $23
million award rendered by an independent arbitrator and relating to a
grievance filed by the Allied Pilots Association, somewhat offset by
the write-down during the first quarter of 2003 of certain investments
held by the Company.
Income Tax Benefit
The Company did not record a net tax benefit associated with its first
quarter 2004 and 2003 losses due to the Company providing a valuation
allowance, as discussed in Note 5 to the accompanying condensed
consolidated financial statements.
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Operating Statistics
The following table provides statistical information for American and
Regional Affiliates for the three months ended March 31, 2004 and
2003.
Three Months Ended March 31,
2004 2003
American Airlines, Inc. Mainline Jet Operations
Revenue passenger miles (millions) 30,290 27,838
Available seat miles (millions) 42,597 40,274
Cargo ton miles (millions) 521 490
Passenger load factor 71.1% 69.1%
Passenger revenue yield per
passenger mile (cents) 12.14 12.19
Passenger revenue per available
seat mile (cents) 8.64 8.43
Cargo revenue yield per ton mile (cents) 28.47 27.38
Operating expenses per available seat mile,
excluding Regional Affiliates (cents) (*) 9.49 11.39
Fuel consumption (gallons, in millions) 741 725
Fuel price per gallon (cents) 101.0 94.0
Operating aircraft at period-end 759 812
Regional Affiliates
Revenue passenger miles (millions) 1,539 1,165
Available seat miles (millions) 2,453 1,987
Passenger load factor 62.7% 58.6%
(*) Excludes $487 million and $423 million of expense incurred
related to Regional Affiliates in 2004 and 2003, respectively.
Operating aircraft at March 31, 2004, included:
American Airlines Aircraft* AMR Eagle Aircraft
Airbus A300-600R 34 ATR 42 9
Boeing 737-800 77 Bombardier CRJ-700 20
Boeing 757-200 140 Embraer 135 39
Boeing 767-200 Extended Range 16 Embraer 140 59
Boeing 767-300 Extended Range 58 Embraer 145 61
Boeing 777-200 Extended Range 45 Super ATR 42
Fokker 100 27 Saab 340B/340B Plus 43
McDonnell Douglas MD-80 362 Total 273
Total 759
* American Airlines aircraft totals include 55 McDonnell Douglas MD-80
aircraft on the TWA LLC operating certificate.
The average aircraft age for American's and AMR Eagle's aircraft is
11.6 years and 5.8 years, respectively.
Of the operating aircraft listed above, one Boeing 767-200ER, 28
McDonnell Douglas MD-80s and 11 Saab 340Bs were in temporary storage
as of March 31, 2004.
American and AMR Eagle have agreed to sell certain aircraft. As of
March 31, 2004, remaining aircraft to be delivered under these
agreements include: 14 Fokker 100 aircraft (four of which were non-
operating), nine ATR 42 aircraft and three Saab 340B aircraft, with
final deliveries in November 2004, December 2004 and June 2004,
respectively.
-14-
Owned and leased aircraft not operated by the Company at March 31,
2004, included:
American Airlines Aircraft AMR Eagle Aircraft
Boeing 757-200 6 Embraer 145 10
Boeing 767-200 9 Saab 340B/340B Plus 49
Boeing 767-200 Extended Range 4 Total 59
Fokker 100 4
McDonnell Douglas MD-80 1
Total 24
AMR Eagle has leased its 10 owned Embraer 145s not operated by the
Company to Trans States Airlines, Inc.
Outlook
Capacity for American's mainline jet operations is expected to
increase about eight percent in the second quarter of 2004 compared to
the second quarter of 2003 and about six percent for the full year
2004 compared to 2003, despite removing aircraft from the fleet and
reducing mainline departures. This is due to increased efficiencies,
driven by three factors: (i) American operated with a low base number
of flights in 2003 as a result of the war in Iraq and SARS, (ii)
American has added seats back to its Boeing 757 and Airbus A300
aircraft and (iii) as American realigns its mid-continent hubs and de-
peaks its Miami schedule, its aircraft productivity levels will
improve.
American previously stated a goal of improving its mainline unit costs
by ten percent for the full year, compared to 2003. However, based on
various factors, including primarily the Company's expectation that
fuel prices will remain high during 2004 compared to 2003, the
Company expects that American's mainline unit costs will improve by
approximately eight percent for the full year compared to 2003 to
approximately 9.3 cents for the full year. The Company expects AMR's unit
costs to be approximately 9.7 cents for the full year. Although the
Company will have a full year of labor savings from its Labor
Agreements and Management Reductions and more fully realize the savings
from its other strategic cost savings initiatives, in addition to high
fuel prices, there are significant cost challenges in 2004 that may
affect the Company's cost reduction efforts. These challenges include
medical benefits costs, airport fees and maintenance, materials and
repairs costs (due to flight hour agreement contractual rate increases
and the benefit from retiring aircraft subsiding).
Item 3. Quantitative and Qualitative Disclosures about Market Risk
As of March 31, 2004, the Company had hedged, with option contracts,
approximately 16 percent of its estimated second quarter 2004 fuel
requirements, nine percent of its estimated third quarter 2004 fuel
requirements, four percent of its estimated fourth quarter 2004 fuel
requirements and an insignificant percentage of its estimated 2005 and
2006 fuel requirements.
There have been no material changes in market risk from the
information provided in Item 7A. Quantitative and Qualitative
Disclosures About Market Risk of the Company's 2003 Form 10-K.
Item 4. Controls and Procedures
The term "disclosure controls and procedures" is defined in Rules 13a-
15(e) and 15d-15(e) of the Securities Exchange Act of 1934, or the
Exchange Act. This term refers to the controls and procedures of a
company that are designed to ensure that information required to be
disclosed by a company in the reports that it files under the Exchange
Act is recorded, processed, summarized and reported within the time
periods specified by the Securities and Exchange Commission. An
evaluation was performed under the supervision and with the
participation of the Company's management, including the Chief
Executive Officer (CEO) and Chief Financial Officer (CFO), of the
effectiveness of the Company's disclosure controls and procedures as
of March 31, 2004. Based on that evaluation, the Company's
management, including the CEO and CFO, concluded that the Company's
disclosure controls and procedures were effective as of March 31,
2004. During the quarter ending on March 31, 2004, there was no
change in the Company's internal control over financial reporting that
has materially affected, or is reasonably likely to materially affect,
the Company's internal control over financial reporting.
-15-
PART II: OTHER INFORMATION
Item 1. Legal Proceedings
On July 26, 1999, a class action lawsuit was filed, and in November
1999 an amended complaint was filed, against AMR Corporation, American
Airlines, Inc., AMR Eagle Holding Corporation, Airlines Reporting
Corporation, and the Sabre Group Holdings, Inc. in the United States
District Court for the Central District of California, Western
Division (Westways World Travel, Inc. v. AMR Corp., et al.). The
lawsuit alleges that requiring travel agencies to pay debit memos to
American for violations of American's fare rules (by customers of the
agencies): (1) breaches the Agent Reporting Agreement between American
and AMR Eagle and the plaintiffs; (2) constitutes unjust enrichment;
and (3) violates the Racketeer Influenced and Corrupt Organizations
Act of 1970 (RICO). The certified class includes all travel agencies
who have been or will be required to pay money to American for debit
memos for fare rules violations from July 26, 1995 to the present.
The plaintiffs seek to enjoin American from enforcing the pricing
rules in question and to recover the amounts paid for debit memos,
plus treble damages, attorneys' fees, and costs. The Company intends
to vigorously defend the lawsuit. Although the Company believes that
the litigation is without merit, a final adverse court decision could
impose restrictions on the Company's relationships with travel
agencies, which could have an adverse impact on the Company.
On May 17, 2002, the named plaintiffs in Hall, et al. v. United
Airlines, et al., pending in the United States District Court for the
Eastern District of North Carolina, filed an amended complaint
alleging that between 1995 and the present, American and over 15 other
defendant airlines conspired to reduce commissions paid to U.S.-based
travel agents in violation of Section 1 of the Sherman Act. The
plaintiffs are seeking monetary damages and injunctive relief. The
court granted class action certification to the plaintiffs on
September 17, 2002, defining the plaintiff class as all travel agents
in the United States, Puerto Rico, and the United States Virgin
Islands, who, at any time from October 1, 1997 to the present, issued
tickets, miscellaneous change orders, or prepaid ticket advices for
travel on any of the defendant airlines. The case is stayed as to US
Airways and United Air Lines, since they filed for bankruptcy.
American is vigorously defending the lawsuit. Defendant carriers
filed a motion for summary judgment on December 10, 2002, which the
court granted on October 30, 2003. Plaintiffs have appealed that
order to the 4th Circuit Court of Appeals, and that appeal remains
pending. A final adverse court decision awarding substantial money
damages or placing restrictions on the Company's commission policies
or practices would have an adverse impact on the Company.
Between April 3, 2003 and June 5, 2003, three lawsuits were filed by
travel agents some of whom have opted out of the Hall class action
(above) to pursue their claims individually against American Airlines,
Inc., other airline defendants, and in one case against certain
airline defendants and Orbitz LLC. (Tam Travel et. al., v. Delta Air
Lines et. al., in the United States District Court for the Northern
District of California - San Francisco (51 individual agencies), Paula
Fausky d/b/a Timeless Travel v. American Airlines, et. al, in the
United States District Court for the Northern District of Ohio Eastern
Division (29 agencies) and Swope Travel et al. v. Orbitz et. al. in
the United States District Court for the Eastern District of Texas
Beaumont Division (6 agencies)). Collectively, these lawsuits seek
damages and injunctive relief alleging that the certain airline
defendants and Orbitz LLC: (i) conspired to prevent travel agents from
acting as effective competitors in the distribution of airline tickets
to passengers in violation of Section 1 of the Sherman Act; (ii)
conspired to monopolize the distribution of common carrier air travel
between airports in the United States in violation of Section 2 of the
Sherman Act; and that (iii) between 1995 and the present, the airline
defendants conspired to reduce commissions paid to U.S.-based travel
agents in violation of Section 1 of the Sherman Act. These cases have
been consolidated in the United States District Court for the Northern
District of Ohio Eastern Division. American is vigorously defending
these lawsuits. A final adverse court decision awarding substantial
money damages or placing restrictions on the Company's distribution
practices would have an adverse impact on the Company.
-16-
On April 25, 2002, a Quebec travel agency filed a motion seeking a
declaratory judgment of the Superior Court in Montreal, Canada
(Voyages Montambault (1989) Inc. v. International Air Transport
Association, et al.), that American and the other airline defendants
owe a "fair and reasonable commission" to the agency, and that
American and the other airline defendants breached alleged contracts
with the agency by adopting policies of not paying base commissions.
The motion was subsequently amended to add 40 additional travel
agencies as petitioners. The current defendants are the International
Air Transport Association, the Air Transport Association of Canada,
Air Canada, American, America West Airlines, Delta Air Lines, Grupo
TACA, Northwest Airlines/KLM Airlines, and Continental Airlines.
American is vigorously defending the lawsuit. Although the Company
believes that the litigation is without merit, a final adverse court
decision granting declaratory relief could expose the Company to
claims for substantial money damages or force the Company to pay
agency commissions, either of which would have an adverse impact on
the Company.
On May 13, 2002, the named plaintiffs in Always Travel, et. al. v. Air
Canada, et. al., pending in the Federal Court of Canada, Trial
Division, Montreal, filed a statement of claim alleging that between
1995 and the present, American, the other defendant airlines, and the
International Air Transport Association conspired to reduce
commissions paid to Canada-based travel agents in violation of Section
45 of the Competition Act of Canada. The named plaintiffs seek
monetary damages and injunctive relief and seek to certify a
nationwide class of travel agents. Plaintiffs have filed a motion for
class certification, but that motion has not yet been decided.
American is vigorously defending the lawsuit. A final adverse court
decision awarding substantial money damages or placing restrictions on
the Company's commission policies would have an adverse impact on the
Company.
On August 14, 2002, a class action lawsuit was filed against American
Airlines, Inc. in the United States District Court for the Central
District of California, Western Division (All World Professional
Travel Services, Inc. v. American Airlines, Inc.). The lawsuit
alleges that requiring travel agencies to pay debit memos for
refunding tickets after September 11, 2001: (1) breaches the Agent
Reporting Agreement between American and plaintiff; (2) constitutes
unjust enrichment; and (3) violates the Racketeer Influenced and
Corrupt Organizations Act of 1970 (RICO). The alleged class includes
all travel agencies who have or will be required to pay moneys to
American for an "administrative service charge," "penalty fee," or
other fee for processing refunds on behalf of passengers who were
unable to use their tickets in the days immediately following the
resumption of air carrier service after the tragedies on September 11,
2001. On April 1, 2004, the court denied plaintiff's motion for class
certification. The plaintiff seeks to enjoin American from collecting
the debit memos and to recover the amounts paid for the debit memos,
plus treble damages, attorneys' fees, and costs. The Company intends
to vigorously defend the lawsuit. Although the Company believes that
the litigation is without merit, a final adverse court decision could
impose restrictions on the Company's relationships with travel
agencies which could have an adverse impact on the Company.
On August 19, 2002, a class action lawsuit seeking monetary damages
was filed, and on May 7, 2003 an amended complaint was filed in the
United States District Court for the Southern District of New York
(Power Travel International, Inc. v. American Airlines, Inc., et al.)
against American, Continental Airlines, Delta Air Lines, United
Airlines, and Northwest Airlines, alleging that American and the other
defendants breached their contracts with the agency and were unjustly
enriched when these carriers at various times reduced their base
commissions to zero. The as yet uncertified class includes all travel
agencies accredited by the Airlines Reporting Corporation "whose base
commissions on airline tickets were unilaterally reduced to zero by"
the defendants. The case is stayed as to United Air Lines, since it
filed for bankruptcy. American is vigorously defending the lawsuit.
Although the Company believes that the litigation is without merit, a
final adverse court decision awarding substantial money damages or
forcing the Company to pay agency commissions would have an adverse
impact on the Company.
-17-
Miami-Dade County (the County) is currently investigating and
remediating various environmental conditions at the Miami
International Airport (MIA) and funding the remediation costs through
landing fees and various cost recovery methods. American Airlines,
Inc. and AMR Eagle have been named as potentially responsible parties
(PRPs) for the contamination at MIA. During the second quarter of
2001, the County filed a lawsuit against 17 defendants, including
American Airlines, Inc., in an attempt to recover its past and future
cleanup costs (Miami-Dade County, Florida v. Advance Cargo Services,
Inc., et al. in the Florida Circuit Court). In addition to the 17
defendants named in the lawsuit, 243 other agencies and companies were
also named as PRPs and contributors to the contamination. American's
and AMR Eagle's portion of the cleanup costs cannot be reasonably
estimated due to various factors, including the unknown extent of the
remedial actions that may be required, the proportion of the cost that
will ultimately be recovered from the responsible parties, and
uncertainties regarding the environmental agencies that will
ultimately supervise the remedial activities and the nature of that
supervision. The Company is vigorously defending the lawsuit.
In April 2004, a lawsuit was filed against American captioned Kimmell
v. AMR, et al. This is a purported class action filed in federal
district court in Dallas. The suit arises from the disclosure of
passenger name records by a vendor of American Airlines. It alleges
various causes of action, including but not limited to violations of
the Electric Communications Privacy Act, negligent misrepresentation,
breach of contract, and violation of alleged common law rights of
privacy. American has not yet been served with the suit.
-18-
Item 6. Exhibits and Reports on Form 8-K
The following exhibits are included herein:
10.1 American Airlines, Inc. 2004 Employee Profit Sharing Plan.
10.2 American Airlines, Inc. 2004 Annual Incentive Plan.
10.3 2004 - 2006 Performance Unit Plan for Officers and Key Employees.
10.4 AMR Corporation 2004 Directors Unit Incentive Plan.
10.5 Amended and Restated Executive Termination Benefits Agreement
between AMR, American Airlines and Jeffrey J. Brundage dated
April 1, 2004.
12 Computation of ratio of earnings to fixed charges for the three
months ended March 31, 2004 and 2003.
31.1 Certification of Chief Executive Officer pursuant to Rule 13a-14(a).
31.2 Certification of Chief Financial Officer pursuant to Rule 13a-14(a).
32 Certification pursuant to Rule 13a-14(b) and section 906 of the
Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of section 1350,
chapter 63 of title 18, United States Code).
Form 8-Ks filed under Item 5 - Other Events
On March 18, 2004, AMR filed an amended report on Form 8-K (Form 8-K/A
No. 1) to provide actual fuel cost, unit cost and capacity and traffic
information for January and February as well as current fuel cost,
unit cost and capacity and traffic expectations for March, the first
quarter and the full year 2004.
Form 8-Ks filed under Item 7 - Financial Statements and Exhibits
On February 25, 2004, AMR filed a report on Form 8-K to provide
Exhibits with reference to the Registration Statement on Form S-3
(Registration No. 333-110760) of AMR Corporation.
Form 8-Ks furnished under Item 9 - Regulation FD Disclosure
On January 7, 2004, AMR furnished a report on Form 8-K to announce
AMR's intent to host a conference call on January 21, 2004 with the
financial community relating to its fourth quarter and full year 2003
results.
On January 28, 2004, AMR furnished a report on Form 8-K to provide
information regarding a presentation by Gerard Arpey at the Goldman,
Sachs & Co. 19th Annual Transportation Conference on February 5, 2004.
On February 27, 2004, AMR furnished a report on Form 8-K to provide
information regarding presentations by AMR's and American's senior
management at upcoming conferences.
On March 17, 2004, AMR furnished a report on Form 8-K to furnish
actual fuel cost, unit cost and capacity and traffic information for
January and February as well as current fuel cost, unit cost and
capacity and traffic expectations for March, the first quarter and the
full year 2004.
On March 18, 2004, AMR furnished a report on Form 8-K to provide
information regarding a presentation by James Beer at Prudential
Equity Group's "Inside our Best Ideas" conference on Monday, March 22, 2004.
-19-
Form 8-Ks filed under Item 12 - Disclosure of Results of Operations
and Financial Condition
On January 21, 2004, AMR furnished a report on Form 8-K to furnish a
press release issued by AMR to announce its fourth quarter and full
year 2003 results.
-20-
Signature
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf
by the undersigned thereunto duly authorized.
AMR CORPORATION
Date: April 23, 2004 BY: /s/ James A. Beer
James A. Beer
Senior Vice President and Chief
Financial Officer
(Principal Financial and Accounting Officer)
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