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SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
_____________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of earliest event
reported: July 17, 2002
AMR CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 1-8400 75-1825172
(State of Incorporation) ( Commission File Number) (IRS Employer
Identification No.)
4333 Amon Carter Blvd. Fort Worth, Texas 76155
(Address of principal executive offices) (Zip Code)
(817) 963-1234
(Registrant's telephone number)
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Item 5. Other Events
AMR Corporation (the Company) is filing herewith a press release
issued on July 17, 2002 by the Company as Exhibit 99.1 which is
included herein. This press release was issued to report the
Company's second quarter 2002 earnings.
Item 7. Financial Statements and Exhibits
The following exhibits are included herein:
99.1 Press Release
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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 hereunto duly authorized.
AMR CORPORATION
/s/ Charles D. MarLett
Charles D. MarLett
Corporate Secretary
Dated: July 17, 2002
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EXHIBIT INDEX
Exhibit Description
99.1 Press Release
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Exhibit 99.1
Contact: Corporate Communications
Fort Worth, Texas
817-967-1577
FOR RELEASE: Wednesday, July 17, 2002
Editor's Note: A Live Webcast reporting second quarter results
will be broadcast on the Internet on July 17 at 2 p.m. EDT (Windows
Media Player required for viewing).
AMR REPORTS SECOND QUARTER LOSS OF $465 MILLION
BEFORE A SPECIAL ITEM
FORT WORTH, Texas - AMR Corporation, the parent company of
American Airlines, Inc., today reported a second quarter net loss
of $465 million before a special item, or $3.00 per share. This
compares with a net loss of $105 million before special items, or
$0.68 per share, in the second quarter of 2001.
"We continued to see a very weak revenue environment in the
second quarter," said Don Carty, AMR's chairman and chief executive
officer, "and although traffic has rebounded nicely since last
fall, average fares are at 15-year lows, sharply depressing
yields."
In response, the Company has taken a number of steps,
including trimming capacity, sharply reducing capital spending and
lowering its operating costs. These actions resulted in AMR's unit
cost rising less than one percent year over year, despite 10.4
percent less capacity.
"We've made good progress on the cost side," Carty said, "and
we're not done. The Company is in the midst of an exhaustive, top-
to-bottom review of its business, and despite our financial
challenges, our employees are doing an outstanding job of focusing
on our customers and providing great service."
- more -
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One result of all this effort, Carty said, is that during the
second quarter, American completed more than 99 percent of its
scheduled flights, and more than 82 percent of American's flights
arrived on time, as reported to the Department of Transportation.
AMR's second quarter results include a $30 million after-tax
special charge ($0.19 per share) that stems from a provision of
Congress' economic stimulus package that changes the period for
carrybacks of net operating losses ("NOLs"). This change allows
companies to carry back 2001 and 2002 NOLs for five years, rather
than two under the previous law, allowing AMR to more quickly
recover its NOLs and thereby achieve a significant cash benefit.
The extended NOL carryback does, however, result in the
displacement of foreign tax credits taken in prior years which are
now expected to expire before they can be used. As a result, the
Company recorded a charge to reflect the anticipated forfeiture of
the foreign tax credits.
Including this special item, AMR reported a second quarter net
loss of $495 million, or $3.19 per share.
Second Quarter Results
(in millions, except 2002 2001
per share amounts)
Amount Loss Amount Loss
(net of per (net of per
tax) share tax) share
Net loss before
special items ($465) ($3.00) ($105) ($0.68)
Anticipated
forfeiture of foreign
tax credits (30) (0.19) -- --
Legal settlement -- -- 29 0.19
Aircraft charge -- -- (430) (2.79)
Net loss ($495) ($3.19) ($507) ($3.29)
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Looking forward, if the revenue environment remains depressed,
the Company expects to post a sizeable operating loss in the third
quarter. In addition, the Company has determined that its goodwill
is likely impaired as defined by the Financial Accounting Standard
Board's recent Statement of Financial Accounting Standards No. 142
on accounting for "Goodwill and Other Intangible Assets." If so,
AMR will record an impairment charge in the third or fourth
quarter. The amount of this non-cash charge has not yet been
determined, but could be up to $1.4 billion pre-tax, the full
amount of AMR's goodwill.
Editor's Note: AMR's Chief Financial Officer, Jeff Campbell, will
make a presentation to analysts during a teleconference on
Wednesday, July 17, from 2 p.m. to 2:45 p.m. EDT. Following the
analyst call, he will hold a question and answer conference call
for media from 3 p.m. to 3:45 p.m. EDT. Reporters interested in
listening to Mr. Campbell's presentation or participating in the
media Q&A conference call should call 817-967-1577 for details.
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. 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 factors that could cause
actual results to differ materially from our expectations.
Additional information concerning these and other factors is
contained in the Company's Securities and Exchange Commission
filings, including but not limited to the Form 10-K for the year
ended December 31, 2001.
Detailed financial information follows:
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Current AMR Corp. News Releases can be accessed via the Internet:
Our address is http://www.amrcorp.com
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AMR CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions, except per share amounts)
(Unaudited)
Three Months Ended June 30, Percent
2002 2001 Change
Revenues
Passenger - American Airlines $3,747 $ 4,645 (19.3)
- AMR Eagle 344 409 (15.9)
Cargo 142 190 (25.3)
Other revenues 246 339 (27.4)
Total operating revenues 4,479 5,583 (19.8)
Expenses
Wages, salaries and benefits 2,126 2,126 -
Aircraft fuel 656 842 (22.1)
Depreciation and amortization 338 352 (4.0)
Other rentals and landing fees 306 320 (4.4)
Maintenance, materials and repairs 285 298 (4.4)
Aircraft rentals 214 226 (5.3)
Food service 180 218 (17.4)
Commissions to agents 155 260 (40.4)
Special charges - 685 -
Other operating expenses 820 1,016 (19.3)
Total operating expenses 5,080 6,343 (19.9)
Operating Loss (601) (760) (20.9)
Other Income (Expense)
Interest income 18 24 (25.0)
Interest expense (164) (132) 24.2
Interest capitalized 22 38 (42.1)
Miscellaneous - net 5 37 (86.5)
(119) (33) *
Loss Before Income Taxes (720) (793) (9.2)
Income tax benefit (225) (286) (21.3)
Net Loss $(495) $ (507) (2.4)
Loss Per Share
Basic and Diluted $ (3.19) $ (3.29)
Number of Shares Used in
Computation
Basic and Diluted 155 154
* Greater than 100%
Note 1: 2002 results include TWA whereas the 2001 amounts include
TWA for the period April 10 through June 30, 2001.
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AMR CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions, except per share amounts)
(Unaudited)
Six Months Ended June 30, Percent
2002 2001 Change
Revenues
Passenger - American Airlines $7,231 $8,580 (15.7)
- AMR Eagle 649 763 (14.9)
Cargo 276 366 (24.6)
Other revenues 459 634 (27.6)
Total operating revenues 8,615 10,343 (16.7)
Expenses
Wages, salaries and benefits 4,206 3,872 8.6
Aircraft fuel 1,183 1,549 (23.6)
Depreciation and amortization 679 665 2.1
Other rentals and landing fees 595 577 3.1
Maintenance, materials and repairs 551 578 (4.7)
Aircraft rentals 440 374 17.6
Food service 350 402 (12.9)
Commissions to agents 316 484 (34.7)
Special charges - 685 -
Other operating expenses 1,625 1,921 (15.4)
Total operating expenses 9,945 11,107 (10.5)
Operating Loss (1,330) (764) 74.1
Other Income (Expense)
Interest income 36 64 (43.8)
Interest expense (330) (251) 31.5
Interest capitalized 44 79 (44.3)
Miscellaneous - net (3) 22 *
(253) (86) *
Loss Before Income Taxes (1,583) (850) 86.2
Income tax benefit (513) (300) 71.0
Net Loss $(1,070) $ (550) 94.5
Loss Per Share
Basic and Diluted $ (6.90) $ (3.58)
Number of Shares Used in
Computation
Basic and Diluted 155 154
* Greater than 100%
Note 1: 2002 results include TWA whereas the 2001 amounts include TWA
for the period April 10 through June 30, 2001.
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AMR CORPORATION
OPERATING STATISTICS
(Unaudited)
Three Months Ended June 30, Percent
2002 2001 Change
American Airlines (*)
Revenue passenger miles (millions) 31,379 35,188 (10.8)
Available seat miles (millions) 43,958 49,044 (10.4)
Cargo ton miles (millions) 518 610 (15.1)
Passenger load factor 71.4% 71.7% (0.3)pts.
Breakeven load factor (**) 86.4% 74.0% 12.4 pts.
Passenger revenue yield per
passenger mile (cents) 11.94 13.20 (9.5)
Passenger revenue per available
seat mile (cents) 8.52 9.47 (10.0)
Cargo revenue yield per ton
mile (cents) 27.21 30.89 (11.9)
Operating expenses per available
seat mile (cents) (**) 10.78 10.73 0.5
Fuel consumption (gallons,
in millions) 808 922 (12.4)
Fuel price per gallon (cents) 75.5 83.3 (9.4)
Fuel price per gallon, excluding
fuel taxes (cents) 70.0 78.0 (10.3)
Operating aircraft at period-end 828 904 (8.4)
AMR Eagle
Revenue passenger miles (millions) 1,059 1,030 2.8
Available seat miles (millions) 1,596 1,680 (5.0)
Passenger load factor 66.4% 61.3% 5.1 pts.
Operating aircraft at period-end 281 271 3.7
AMR Corporation
Average Equivalent Number of Employees
American Airlines 100,100 115,200
Other 11,800 13,100
Total 111,900 128,300
(*)2002 results include TWA whereas the 2001 amounts include TWA for
the period April 10 through June 30, 2001.
(**) Excludes the impact of the second quarter 2001 asset impairment charge.
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AMR CORPORATION
OPERATING STATISTICS
(Unaudited)
Six Months Ended June 30, Percent
2002 2001 Change
American Airlines (*)
Revenue passenger miles (millions) 59,197 61,640 (4.0)
Available seat miles (millions) 84,047 88,021 (4.5)
Cargo ton miles (millions) 981 1,159 (15.4)
Passenger load factor 70.4% 70.0% 0.4 pts.
Breakeven load factor (**) 86.9% 71.3% 15.6 pts.
Passenger revenue yield per
passenger mile (cents) 12.22 13.92 (12.2)
Passenger revenue per available
seat mile (cents) 8.60 9.75 (11.8)
Cargo revenue yield per ton
mile (cents) 27.93 31.27 (10.7)
Operating expenses per available
seat mile (cents) (**) 11.03 10.97 0.5
Fuel consumption (gallons,
in millions) 1,553 1,664 (6.7)
Fuel price per gallon (cents) 71.5 85.2 (16.1)
Fuel price per gallon, excluding fuel
taxes (cents) 66.0 79.8 (17.3)
Operating aircraft at period-end 828 904 (8.4)
AMR Eagle
Revenue passenger miles (millions) 1,978 1,890 4.7
Available seat miles (millions) 3,163 3,268 (3.2)
Passenger load factor 62.5% 57.8% 4.7 pts.
Operating aircraft at period-end 281 271 3.7
(*) 2002 results include TWA whereas the 2001 amounts include TWA for
the period April 10 through June 30, 2001.
(**) Excludes the impact of the second quarter 2001 asset impairment charge.