American Airlines Group (AAL) posts third-quarter profit of US$169 million

Highlights

  • American Airlines’ net profit was US$169 million, or US$0.25 per diluted share, in the third quarter.

  • The Texas-based airline plans to operate over 6,000 daily flights during peak days in the fourth quarter. Its average daily flights were around 5,600 trips in the third quarter.

  • Chairman and CEO Doug Parker said the covid disruption delayed the revenue recovery but hasn’t stopped the progress.

American Airlines Group (NASDAQ: AAL) on Thursday posted a third-quarter profit of US$169 million despite a slowdown in air traffic due to the delta variant threat.

The company expects improved bookings during the upcoming holidays.

Chairman and CEO Doug Parker said the covid disruption delayed the revenue recovery but hasn’t stopped the progress.

The airline said the delta threat caused a slowdown in bookings and increased cancellations.

The company expects its fourth-quarter revenue to be down 20% from the same period in 2019. In addition, it said the passenger-carrying capacity in Q4 will be about 11% to 13% below the third quarter of 2019.

The Texas-based airline plans to operate over 6,000 daily flights during peak days in the fourth quarter. Its average daily flights were around 5,600 trips in the third quarter.

The airline had received US$992 million in federal pandemic relief from the government.

Its third-quarter revenue was US$9.0 billion, slightly above analysts’ estimates of US$8.92 billion.

However, it was down 25% from the same period in 2019.

Third-Quarter Highlights

American Airlines’ net profit was US$169 million, or US$0.25 per diluted share, in the quarter. Excluding net special items1, the net loss was US$641 million, or ($0.99) per share.

The revenue was up 20% to US$9.0 billion from the second quarter of 2021.

Its total available liquidity after prepayment of loans was around US$18 billion in the quarter-end.

Parker said it was the best quarter since the pandemic began based on pre-tax financial results.

The airline’s passenger revenue was US$7.95 billion, while cargo revenue was US$332 million.

The company said that it also delivered 4.5 million covid vaccine doses to Guatemala as part of the White House’s relief efforts during the quarter.

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American Airlines Group (AAL) posts third-quarter profit of US$169 million

Source: Pixabay

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Stock Performance

The AAL stock was up 1.41% to US$19.795 at 1:54 pm ET on Thursday.

The 52-week highest and lowest stock prices were US$26.09 and US$10.63, respectively. Its forward P/E one year is -2.43, and the EPS is US$-10.46. The annualized dividend is US$0.40.

American Airlines has a market cap of around US$12.89 billion.

Also Read: Blackstone (BX), Freeport (DCX) post record Q3 earnings as sales soar

Bottomline

The S&P 500 airline index rose 6.57% YTD but declined 4.25% QTD. The industry is still reeling under the weight of the pandemic. Analysts expect the sector will take more time to recover to the levels of 2019, given the covid uncertainty that is still lingering.

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