-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, SaIj6s5Z5ciAyRmHpfdEm4enA1AKfjASNNsoRK6gcmn1miSwOHqcbxKAONvjWABe lJMG3hHWfdT9u/WNPhd3vg== 0000004515-07-000025.txt : 20070319 0000004515-07-000025.hdr.sgml : 20070319 20070319172118 ACCESSION NUMBER: 0000004515-07-000025 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20070319 ITEM INFORMATION: Other Events FILED AS OF DATE: 20070319 DATE AS OF CHANGE: 20070319 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMERICAN AIRLINES INC CENTRAL INDEX KEY: 0000004515 STANDARD INDUSTRIAL CLASSIFICATION: AIR TRANSPORTATION, SCHEDULED [4512] IRS NUMBER: 131502798 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-02691 FILM NUMBER: 07704243 BUSINESS ADDRESS: STREET 1: 4333 AMON CARTER BLVD CITY: FT WORTH STATE: TX ZIP: 76155 BUSINESS PHONE: 8179631234 MAIL ADDRESS: STREET 1: P O BOX 619616 MD5661 CITY: DALLAS FORT WORTH AI STATE: TX ZIP: 75261-9616 FORMER COMPANY: FORMER CONFORMED NAME: AMERICAN AIRWAYS INC DATE OF NAME CHANGE: 19670629 8-K 1 aa03198k.txt AMERICAN AIRLINES, INC. UNITED STATES 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: March 19, 2007 American Airlines, Inc. (Exact name of registrant as specified in its charter) Delaware 1-2691 13-1502798 (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) (Former name or former address, if changed since last report.) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 8.01 Other Events American Airlines, Inc. is filing herewith an Eagle Eye communication to investors by its parent company, AMR Corporation. This document includes (a) actual unit cost, fuel price, capacity and traffic information for January and February and (b) forecasts of unit cost, revenue performance, fuel prices and fuel hedging, capacity and traffic estimates, liquidity expectations, other income/expense estimates and share count. 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. American Airlines, Inc. /s/ Kenneth W. Wimberly Kenneth W. Wimberly Corporate Secretary Dated: March 19, 2007 AMR EAGLE EYE March 19, 2007 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, the words "expects", "plans," "anticipates," "indicates," "believes," "forecast," "guidance," "outlook", "may," "will," "should" 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 plans and needs; overall economic and industry conditions; plans and objectives for future operations; and the impact on the Company of its results of operations in recent 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 on 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. This document includes forecasts of unit cost and revenue performance, fuel prices and fuel hedging, capacity and traffic estimates, other income/expense estimates, share count, and statements regarding the Company's liquidity, each of which is a forward-looking statement. Forward-looking statements are subject to a number of factors that could cause the Company's actual results to differ materially from the Company's 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: the materially weakened financial condition of the Company, resulting from its significant losses in recent years; the ability of the Company to generate additional revenues and significantly reduce its costs; changes in economic and other conditions beyond the Company's control, and the volatile results of the Company's operations; the Company's substantial indebtedness and other obligations; the ability of the Company to satisfy existing financial or other covenants in certain of its credit agreements; continued high fuel prices and further increases in the price of fuel, and the availability of fuel; the fiercely competitive business environment faced by the Company, and historically low fare levels; competition with reorganized and reorganizing carriers; the Company's reduced pricing power; the Company's likely need to raise additional funds and its ability to do so on acceptable terms; changes in the Company's business strategy; government regulation of the Company's business; conflicts overseas or terrorist attacks; uncertainties with respect to the Company's international operations; outbreaks of a disease (such as SARS or avian flu) that affects travel behavior; uncertainties with respect to the Company's relationships with unionized and other employee work groups; increased insurance costs and potential reductions of available insurance coverage; the Company's ability to retain key management personnel; potential failures or disruptions of the Company's computer, communications or other technology systems; changes in the price of the Company's common stock; and the ability of the Company to reach acceptable agreements with third parties. 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, 2006. This Eagle Eye provides updated guidance for the first quarter and the full year 2007. Performance Update Costs: Unit cost forecasts are attached. Revenue: First quarter mainline passenger unit revenue is expected to increase between 3.5% and 4.5% year over year. First quarter consolidated passenger unit revenue is expected to increase between 2.7% and 3.7% year over year. In the Other Revenue category, year over year improvements are expected to continue to moderate as prior year comparables become more difficult. Liquidity: We expect to end the first quarter with a cash and short- term investment balance of approximately $6 billion, including nearly $500 million in restricted cash and short-term investments. Kenji Hashimoto Managing Director, Investor Relations AMR EAGLE EYE Fuel Forecast Fuel Hedge Position: 1Q07: Hedged on 29% of consumption at an average cap of $66/bbl WTI Crude AMR Fuel Price (Including Effective Hedges and Taxes) and Consumption Actual Forecast Jan Feb Mar 1Q07 2007 Fuel Price (dollars/gal) 1.84 1.79 1.87 1.84 1.98 Fuel Consumption (MM gals) 263.7 233.8 264.8 762.3 3,107.8 Unit Cost Forecast (cents) AMR Consolidated Cost per ASM Actual Forecast Jan Feb Mar 1Q07 2007 AMR Cost per ASM 1/ 11.46 11.84 11.31 11.52 11.51 AMR Cost per ASM (ex-fuel) 2/ 8.35 8.79 8.16 8.42 8.19 American Mainline Cost per ASM Actual Forecast Jan Feb Mar 1Q07 2007 AA Cost per ASM 1/ 10.87 11.20 10.70 10.91 10.90 AA Cost per ASM (ex-fuel) 2/ 7.85 8.23 7.63 7.89 7.67 Note: The increase in ex-fuel CASM versus prior guidance is mostly attributable to reduced capacity associated with weather related cancellations January 1 through March 18. During this period, American Airlines cancelled 2.5 percent of 1Q07's expected departures due to weather. American Airlines has an Annual Incentive Plan (AIP) and Profit Sharing Program that provide variable compensation that rewards frontline employees when American Airlines achieves certain financial and customer service targets. AIP has two components: 1. Customer Service pays out to eligible employees on a quarterly basis up to $1,200 per employee per year when American Airlines performs well in the monthly customer service measures in Survey America and in the A + 14 Dependability statistics tracked by the Department of Transportation. Since 2004, the Company has paid out more than $46 million in AIP Customer Service payments to employees. 2. Financial payments are based on the Company's financial results. This pays out 2.5 percent of wages when American Airlines records a 5 percent annual pre-tax margin. If the pre-tax margin reaches 10 percent, these annual awards rise to 5 percent of wages. And, if the pre-tax margin reaches 15 percent, these annual awards pay out 10 percent of wages. Profit Sharing pays cash awards to all eligible employees when American Airlines exceeds $500 million in pre-tax earnings. Generally, the profit sharing plan provides for a profit sharing pool for eligible employees equal to 15 percent of pre-tax income of American Airlines in excess of $500 million. Based on current conditions, the Company's most recently prepared internal forecast for the full year 2007 contains an accrual for profit sharing. There can be no assurance that the Company's forecast will approximate actual results. Additionally, reductions in forecasted pre-tax earnings from a previous quarter could result in the reversal of a portion or all of the previously recorded profit sharing expense. For more information regarding these plans, please see the Company's 2006 Form 10-K. AMR EAGLE EYE Capacity and Traffic Forecast (millions) AA Mainline Operations Actual Forecast Jan Feb Mar 1Q07 2007 ASMs 14,486 12,726 14,595 41,807 171,307 Domestic 9,280 8,191 9,430 26,901 109,205 International 5,206 4,535 5,165 14,906 62,103 Traffic 10,902 9,737 11,990 32,630 138,272 Regional Affiliate Operations Actual Forecast Jan Feb Mar 1Q07 2007 ASMs 1,140 998 1,147 3,285 13,865 Traffic 730 690 840 2,260 10,177 Below the Line Income/Expense Total Other Income (Expense) is estimated at $(164) million in the first quarter of 2007. Share Count (millions) 1Q 2007 Earnings Basic Diluted Over $66 million 236 297 $49 - $65 million 236 282 $0 - $48 million 236 265 Loss 236 236 FY 2007 Earnings Basic Diluted Over $267 million 246 302 $200 - $266 million 246 287 $0 - $199 million 246 270 Loss 246 246 1/ Data is as reported 2/ The Company believes that unit costs excluding fuel is a useful measurement to investors in monitoring the performance of the Company's costs excluding the volatility of fuel. Reconciliation to GAAP follows: Actual Forecast Jan Feb Mar 1Q07 2007 Cents AMR CASM 11.46 11.84 11.31 11.52 11.51 Less Fuel CASM 3.11 3.05 3.15 3.10 3.32 AMR CASM Excluding Fuel 8.35 8.79 8.16 8.42 8.19 Actual Forecast Jan Feb Mar 1Q07 2007 Cents AA CASM 10.87 11.20 10.70 10.91 10.90 Less Fuel CASM 3.02 2.97 3.07 3.02 3.23 AA CASM Excluding Fuel 7.85 8.23 7.63 7.89 7.67 -----END PRIVACY-ENHANCED MESSAGE-----