-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, YGJyNZ0C3LdlyvNU5wRRPDagPCTP2/MURs++6vyN9OPYrqJGRlKBmmnbPondxfq5 2ehx0JrHYjML76+xSw4nGQ== 0000006201-94-000004.txt : 19940805 0000006201-94-000004.hdr.sgml : 19940805 ACCESSION NUMBER: 0000006201-94-000004 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19940630 FILED AS OF DATE: 19940803 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMR CORP CENTRAL INDEX KEY: 0000006201 STANDARD INDUSTRIAL CLASSIFICATION: 4512 IRS NUMBER: 751825172 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-08400 FILM NUMBER: 94541521 BUSINESS ADDRESS: STREET 1: 4333 AMON CARTER BLVD CITY: FORT WORTH STATE: TX ZIP: 76155 BUSINESS PHONE: 8179314796 MAIL ADDRESS: STREET 2: P O BOX 619616 MD 5509 CITY: DALLAS FT WORTH AIRP STATE: TX ZIP: 75261-9616 10-Q 1 -20- 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-Q [X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarter ended: June 30, 1994 [ ] 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 jurisdiction of (IRS Employer identification No.) incorporation or organization) 4333 AMON CARTER BLVD. FORT WORTH, TEXAS 76155 (Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (817) 963-1234 (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 APPLICABLE ONLY TO CORPORATE ISSUERS: 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 - 75,858,777 shares outstanding as of July 29, 1994 2 AMR CORPORATION INDEX
Page Number Part I: FINANCIAL INFORMATION Consolidated Statement of Operations for the three and six months ended June 30, 1994 and 1993 1 Condensed Consolidated Balance Sheet at June 30, 1994 and December 31, 1993 2 Condensed Consolidated Statement of Cash Flows for the six months ended June 30, 1994 and 1993 3 Notes to Financial Statements 4 Management's Discussion and Analysis of Financial Condition and Results of Operations 5 Part II: OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K 13 Signature 14
3 PART I Item 1. Consolidated Financial Statements
AMR CORPORATION CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited) (in millions, Three Months Ended June 30, Six Months Ended June 30, except per share amounts) 1994 1993 1994 1993 Revenues Air Transportation Group: Passenger - American Airlines $ 3,267 $ 3,484 $ 6,295 $ 6,611 - AMR Eagle 207 180 388 345 Cargo 165 164 321 316 Other 149 130 288 268 3,788 3,958 7,292 7,540 The SABRE Group 388 347 774 677 AMR Management Services Group 127 106 258 211 Less: Intergroup revenues (202) (199) (415) (402) Total operating revenues 4,101 4,212 7,909 8,026 Expenses Wages, salaries and benefits 1,396 1,364 2,764 2,676 Aircraft fuel 388 495 783 970 Commissions to agents 339 376 665 711 Depreciation and amortization 320 304 640 596 Other rentals and landing fees 206 213 417 426 Aircraft rentals 172 184 351 370 Food service 171 182 333 350 Maintenance materials and repairs 149 171 292 346 Other operating expenses 559 559 1,104 1,101 Total operating expenses 3,700 3,848 7,349 7,546 Operating Income 401 364 560 480 Other Income (Expense) Interest income 7 14 13 32 Interest expense (154) (168) (306) (343) Interest capitalized 4 13 11 30 Miscellaneous - net (10) (144) (28) (148) (153) (285) (310) (429) Earnings Before Income Taxes 248 79 250 51 Income tax provision 95 32 104 26 Net Earnings 153 47 146 25 Preferred stock dividends 17 17 33 27 Earnings (Loss) Applicable to Common Shares $ 136 $ 30 $ 113 $ (2) Earnings (Loss) Per Common Share: Primary $ 1.77 $ 0.39 $ 1.48 $ (0.03) Fully diluted $ 1.68 $ 0.39 $ 1.48 $ (0.03) Number of common shares used in computations Primary 76 76 76 76 Fully diluted 90 76 76 76
See accompanying notes. -1- 4
AMR CORPORATION CONDENSED CONSOLIDATED BALANCE SHEET June 30, December 31, (Unaudited) (in millions) 1994 1993 Current Assets Cash $ 65 $ 63 Short-term investments 568 523 Receivables, net 1,040 910 Inventories, net 680 688 Other current assets 526 506 Total current assets 2,879 2,690 Equipment and Property Flight equipment, net 10,107 9,783 Purchase deposits for flight equipment 142 350 10,249 10,133 Other equipment and property, net 2,051 2,128 12,300 12,261 Equipment and Property Under Capital Leases Flight equipment, net 1,664 1,543 Other equipment and property, net 173 173 1,837 1,716 Route acquisition costs, net 1,046 1,061 Other assets, net 1,805 1,598 $ 19,867 $ 19,326 Current Liabilities Accounts payable $ 917 $ 921 Accrued liabilities 1,815 1,726 Air traffic liability 1,627 1,460 Current maturities of long-term debt 61 200 Current obligations under capital leases 128 110 Total current liabilities 4,548 4,417 Long-term debt 5,441 5,431 Obligations under capital leases 2,269 2,123 Deferred income taxes 410 310 Other liabilities, deferred gains, deferred credits and postretirement benefits 2,800 2,769 Stockholders' Equity Convertible preferred stock 1,081 1,081 Common stock 76 76 Additional paid-in capital 2,038 2,035 Retained earnings 1,204 1,084 4,399 4,276 $ 19,867 $ 19,326 See accompanying notes.
-2- 5
AMR CORPORATION CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS Six Months Ended June 30, (Unaudited) (in millions) 1994 1993 Net Cash Provided by Operating Activities $ 992 $ 867 Cash Flow from Investing Activities: Capital expenditures (612) (1,284) Net increase in short-term investments (44) (272) Investment in Canadian Airlines International, Ltd. (177) - Other, net 7 6 Net cash used for investing activities (826) (1,550) Cash Flow from Financing Activities: Proceeds from: Issuance of long-term debt 109 166 Issuance of preferred stock - 1,081 Net repayments of short-term borrowings with maturities of 90 days or less - (350) Other short-term borrowings 200 - Payments on other short-term borrowings (200) (29) Payments on long-term debt and capital lease obligations (242) (138) Payments of dividends on preferred stock (33) (16) Other, net 2 4 Net cash (used for) provided by financing activities (164) 718 Net increase in cash 2 35 Cash at beginning of period 63 45 Cash at end of period $ 65 $ 80 Cash Payments (Refunds) For: Interest (net of amounts capitalized) $ 294 $ 295 Income taxes (58) (117) Financing Activities Not Affecting Cash: Capital lease obligations incurred $ 190 $ 21
See accompanying notes. -3- 6 AMR CORPORATION Notes to Financial Statements (Unaudited) 1. In the opinion of management, these financial statements contain all adjustments necessary to present fairly the financial position, results of operations and cash flows for the periods indicated. Such adjustments are of a normal recurring nature except as disclosed. These financial statements and related notes should be read in conjunction with the financial statements and notes included in AMR's Annual Report on Form 10-K for the year ended December 31, 1993. 2. Passenger revenues for the three and six months ended June 30, 1994, include a positive adjustment of $35 million produced by a change in the Company's estimate of the usage patterns of miles sold to participating companies in American's AAdvantage frequent flyer program. Included in Passenger revenues for the three and six months ended June 30, 1993, is a positive adjustment of $115 million resulting from a change in estimate relating to certain earned passenger revenues. 3. Included in Miscellaneous - net for the three and six months ended June 30, 1993, is a $125 million charge related to the retirement of 31 DC-10 aircraft. The charge represents the Company's best estimate of the expected loss based upon the anticipated method of disposition. However, should the ultimate method of disposition differ, the actual loss could be different than the amount estimated. 4. Accumulated depreciation of owned equipment and property at June 30, 1994 and December 31, 1993 was $5.2 billion and $4.9 billion, respectively. Accumulated amortization of equipment and property under capital leases at June 30, 1994 and December 31, 1993 was $825 million and $760 million, respectively. 5.In April 1994 AMR signed a comprehensive 20-year services ag reement with Canadian Airlines International (CAI). Among the services AMR will provide CAI are accounting, data processing and communications operations, operations planning, pricing and yield management, international services, passenger services procedures training, and U. S. originating reservations activity. Revenues from the contract are expected to exceed $100 million in the first full year and exceed $2.0 billion over the 20-year contract. In April 1994 AMR also made a $177 million investment in CAI, giving it approximately a one-third economic interest in the company. -4- 7 Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION RESULTS OF OPERATIONS Summary AMR recorded net earnings of $153 million ($1.77 per common share primary, $1.68 fully diluted) for the three months ended June 30, 1994, compared with net earnings of $47 million ($0.39 per common share, both primary and fully diluted) for the same period in 1993. AMR's second quarter operating income increased 10.2 percent to $401 million. For the six months ended June 30, 1994, AMR recorded net earnings of $146 million ($1.48 per common share, both primary and fully diluted) compared with net earnings of $25 million ($0.03 loss per common share, both primary and fully diluted) for the same period of 1993. AMR's operating income improved 16.7 percent to $560 million. AMR's results for the three and six months ended June 30, 1994, included a $35 million positive adjustment ($22 million after tax) to Passenger revenues produced by a change in the Company's estimate of the usage patterns of miles sold to participating companies in American's AAdvantage frequent flyer program. The results for the three and six months ended June 30, 1993, included a positive $115 million adjustment ($67 million net of related commission expense and taxes) to passenger revenues for a change in estimate related to certain earned passenger revenues and a $125 million charge ($79 million after tax) for the retirement of 31 McDonnell Douglas DC-10 aircraft. The improvement in AMR's results reflected better performance by two of the Company's three business units - the Air Transportation Group, which includes American Airlines, Inc.'s Passenger and Cargo divisions and AMR Eagle, Inc.; and The SABRE Group, which includes AMR's information technology businesses. AMR's third business unit is the Management Services Group, which includes AMR's airline management, aviation services, training, consulting, and investment service activities. The following sections provide a discussion of AMR's results by reporting segment. A description of the businesses in each reporting segment is included in AMR's Annual Report on Form 10-K for the year ended December 31, 1993. -5- 8 RESULTS OF OPERATIONS (CONTINUED) For the Three Months Ended June 30, 1994 and 1993
AIR TRANSPORTATION GROUP FINANCIAL HIGHLIGHTS (in millions) Three Months Ended June 30, 1994 1993 Revenues Passenger - American Airlines $ 3,267 $ 3,484 - AMR Eagle 207 180 Cargo 165 164 Other 149 130 3,788 3,958 Expenses Wages, salaries and benefits 1,232 1,237 Aircraft fuel 388 495 Commission to agents 339 376 Depreciation and amortization 262 251 Other operating expenses 1,280 1,328 Total operating expenses 3,501 3,687 Operating Income 287 271 Other Income (Expense) (138) (277) Earnings (Loss) Before Income Taxes $ 149 $ (6)
American's passenger revenues decreased 6.2 percent, $217 million, in the second quarter of 1994. Passenger revenue yield per passenger mile decreased 2.9 percent to 13.37 cents in the second quarter. Excluding the impact of the passenger revenue adjustments mentioned previously, yield would have decreased 0.7 percent. Revenue passenger miles decreased 3.4 percent while available seat miles (ASMs) fell 7.8 percent, resulting in an improvement of 2.9 points in the passenger load factor. As a result, American's passenger revenue per available seat mile increased by 1.7 percent. The decrease in American's ASMs is the result of retiring 71 aircraft (31 McDonnell Douglas DC-10 and 40 Boeing 727 aircraft) and subleasing two McDonnell Douglas MD-11 aircraft, partially offset by the addition of 35 new aircraft (24 Fokker F100, seven Boeing 757, and four Boeing 767 aircraft) since June 30, 1993. American's domestic traffic fell 5.4 percent while capacity was reduced 8.6 percent. International traffic grew 2.2 percent while capacity decreased 4.8 percent. The major growth in international traffic was in Latin America, which increased 6.3 percent on a capacity decrease of 2.0 percent. Passenger revenues of the AMR Eagle carriers increased 15.0 percent, $27 million, primarily due to the expansion of regional operations into new and larger markets. Traffic on the AMR Eagle carriers increased 20.9 percent on a capacity increase of 17.5 percent. The increase in the AMR Eagle carriers' ASMs is the result of the addition of 26 aircraft: (nine 64-seat Super ATR and 17 34-seat Saab 340 aircraft) partially offset by the retirement of 29 19-seat Jetstream 31 aircraft. Cargo revenues were unchanged, as a 6.5 percent increase in American's cargo volumes offset a 5.0 percent decline in yields. -6- 9 RESULTS OF OPERATIONS (CONTINUED) The Air Transportation Group's operating expenses decreased 5.0 percent, $186 million. Since capacity decreased more rapidly than expenses, American's Passenger Division operating expenses per ASM increased 1.0 percent to 8.36 cents. Wages, salaries and benefits fell 0.4 percent, $5 million, due to a 4.3 percent reduction in the average number of equivalent employees partially offset by salary adjustments for existing employees. Aircraft fuel expense fell 21.6 percent, $107 million, due primarily to a 14.0 percent decrease in American's average price per gallon combined with a 9.8 percent decline in gallons consumed by American. Commissions to agents decreased 9.8 percent, $37 million, due principally to the decrease in passenger revenues. New aircraft acquisitions and other capital expenditures raised depreciation and amortization 4.4 percent, $11 million. Other operating expenses, consisting of aircraft rentals, other rentals and landing fees, food service costs, maintenance costs and other miscellaneous operating expenses decreased 3.6 percent, $48 million. Maintenance expenses were lower as a result of retiring older jet aircraft from the fleet and increased operating efficiencies. Food service costs and landing fees fell as a result of declines in traffic and capacity, respectively.
AIR TRANSPORTATION GROUP OPERATING STATISTICS Three Months Ended June 30, Percent (Unaudited) 1994 1993 Change American Airlines Passenger Division: Revenue passenger miles 24,443 25,307 (3.4) (millions) Available seat miles (millions) 37,953 41,145 (7.8) Passenger load factor 64.4% 61.5% 2.9 pts. Passenger revenue yield per passenger mile (cents) 13.37 13.77 (2.9) Passenger revenue per available seat mile (cents) 8.61 8.47 1.7 Operating expenses per available seat mile (cents) 8.36 8.28 1.0 Fuel consumption (gallons, in millions) 681 755 (9.8) Fuel price per gallon (cents) 54.8 63.7 (14.0) American Airlines Cargo Division: Cargo ton miles (millions) 494 464 6.5 Revenue yield per ton mile (cents) 33.44 35.21 (5.0) AMR Eagle, Inc.: Revenue passenger miles (millions) 642 531 20.9 Available seat mile (millions) 1,123 956 17.5 Passenger load factor 57.2% 55.5% 1.7 pts. -7- 10 RESULTS OF OPERATIONS (CONTINUED)
THE SABRE GROUP FINANCIAL HIGHLIGHTS (in millions) Three Months Ended June 30, 1994 1993 Revenues $ 388 $ 347 Expenses Wages, salaries and benefits 123 103 Depreciation and amortization 46 43 Other operating expenses 118 120 Total operating expenses 287 266 Operating Income 101 81 Other Income (Expense) (6) (1) Earnings Before Income Taxes $ 95 $ 80
Revenues Revenues for The SABRE Group increased 11.8 percent, $41 million, primarily due to increased booking fee revenues resulting from growth in booking volumes, increases in average fees per booking collected from participating vendors and the introduction of a premium product. Expenses Wages, salaries and benefits increased 19.4 percent, $20 million, due to a 5.2 percent increase in the average number of equivalent employees and wage and salary increases.
AMR MANAGEMENT SERVICES GROUP FINANCIAL HIGHLIGHTS (in millions) Three Months Ended June 30, 1994 1993 Revenues $ 127 $ 106 Expenses Wages, salaries and benefits 41 24 Other operating expenses 73 70 Total operating expenses 114 94 Operating Income 13 12 Other Income (Expense) (9) (7) Earnings Before Income Taxes $ 4 $ 5
Revenues Revenues for the AMR Management Services Group increased 19.8 percent, $21 million. AMR Services' revenues increased 19.9 percent to $80 million, primarily as a result of strong domestic fuel sales, expansion of European operations, and the acquisition of an additional domestic fixed-base operator in November 1993. Americas Ground Services, which began operations in the second quarter of 1993, contributed $7 million in revenues. Revenues of AMR Training and Consulting Group, which began operations in the first quarter of 1993, increased by approximately $8 million in the second quarter of 1994. -8- 11 RESULTS OF OPERATIONS (CONTINUED) Expenses Wages, salaries and benefits increased 70.8 percent, $17 million, due primarily to a 42.2 percent increase in the average number of equivalent employees driven by the acquisition and startup of the new operations mentioned above. For the Six Months Ended June 30, 1994 and 1993
AIR TRANSPORTATION GROUP FINANCIAL HIGHLIGHTS (in millions) Six Months Ended June 30, 1994 1993 Revenues Passenger - American Airlines $ 6,295 $ 6,611 - AMR Eagle 388 345 Cargo 321 316 Other 288 268 7,292 7,540 Expenses Wages, salaries and benefits 2,443 2,422 Aircraft fuel 783 970 Commission to agents 665 711 Depreciation and amortization 526 490 Other operating expenses 2,542 2,644 Total operating expenses 6,959 7,237 Operating Income 333 303 Other Income (Expense) (285) (413) Earnings (Loss) Before Income Taxes $ 48 $ (110)
American's passenger revenues decreased 4.8 percent, $316 million, in the first six months of 1994. Passenger revenue yield per passenger mile decreased 2.3 percent to 13.44 cents in 1994. Excluding the impact of the passenger revenue adjustments mentioned previously, yield would have decreased 1.1 percent. Revenue passenger miles decreased 2.5 percent while available seat miles (ASMs) fell 7.1 percent, resulting in an improvement of 2.9 points in the passenger load factor. As a result, American's passenger revenue per available seat mile increased by 2.4 percent. The decrease in American's ASMs is the result of retiring 71 aircraft (31 McDonnell Douglas DC-10 and 40 Boeing 727 aircraft) and subleasing two McDonnell Douglas MD-11 aircraft, partially offset by the addition of 35 new aircraft (24 Fokker F100, seven Boeing 757, and four Boeing 767 aircraft) since June 30, 1993. For the first six months of 1994 compared to the same period in 1993, American's domestic traffic decreased 4.1 percent on capacity reductions of 7.8 percent and international traffic grew 1.7 percent on a capacity reduction of 5.0 percent. The change in international traffic was driven by an 8.8 percent growth in Latin America with capacity growth of 0.4 percent, offset by a 4.5 percent decrease in traffic to Europe primarily driven by a capacity reduction of 10.9 percent. Passenger revenues of the AMR Eagle carriers increased 12.5 percent, $43 million, primarily due to the expansion of regional operations into larger markets. Traffic on the AMR Eagle carriers increased 21.0 percent, while capacity grew 14.3 percent. -9- 12 RESULTS OF OPERATIONS (CONTINUED) Cargo revenues increased 1.6 percent, $5 million, driven by a 7.2 percent increase in American's domestic and international cargo volumes, partially offset by a decrease in yields of 4.4 percent brought about by strong price competition resulting from excess industry capacity. American's capacity or ASMs decreased 7.1 percent in the first six months of 1994 primarily as a result of the fleet changes mentioned previously. Air Transportation Group's operating expenses decreased 3.8 percent, $278 million. Because capacity decreased more rapidly than expenses, American's passenger division cost per ASM increased by 2.0 percent to 8.51 cents. Wages, salaries and benefits rose 0.9 percent, $21 million, due primarily to salary adjustments for existing employees, partially offset by a 3.8 percent reduction in the average number of equivalent employees. Aircraft fuel expense decreased 19.3 percent, $187 million, due to an 11.8 percent decrease in American's average price per gallon, combined with a 9.1 percent decrease in gallons consumed by American. Commissions to agents decreased 6.5 percent, $46 million, due principally to decreased passenger revenues. New aircraft acquisitions and other capital improvements raised depreciation and amortization costs 7.3 percent, $36 million. Other operating expenses, consisting of aircraft rentals, other rentals and landing fees, food service costs, maintenance costs and other miscellaneous operating expenses decreased 3.9 percent, $102 million, primarily due to lower maintenance costs as a result of retiring older jet aircraft from the fleet and increased operating efficiencies. In addition, food costs and landing fees fell as a result of declines in traffic and capacity, respectively.
AIR TRANSPORTATION GROUP OPERATING STATISTICS Six Months Ended June 30, Percent (Unaudited) 1994 1993 Change American Airlines Passenger Division: Revenue passenger miles 46,822 48,034 (2.5) (millions) Available seat miles (millions) 74,668 80,337 (7.1) Passenger load factor 62.7% 59.8% 2.9 pts. Passenger revenue yield per passenger mile (cents) 13.44 13.76 (2.3) Passenger revenue per available seat mile (cents) 8.43 8.23 2.4 Operating expenses per available seat mile (cents) 8.51 8.34 2.0 Fuel consumption (gallons, in millions) 1,344 1,479 (9.1) Fuel price per gallon (cents) 56.2 63.7 (11.8) Operating aircraft at period end 650 687 (5.4) American Airlines Cargo Division: Cargo ton miles (millions) 937 874 7.2 Revenue yield per ton mile (cents) 34.26 35.85 (4.4) AMR Eagle, Inc.: Revenue passenger miles (millions) 1,182 977 21.0 Available seat miles (millions) 2,116 1,852 14.3 Passenger load factor 55.9% 52.8% 3.1 pts. Operating aircraft at period end 278 281 (1.1)
-10- 13 RESULTS OF OPERATIONS (CONTINUED)
THE SABRE GROUP FINANCIAL HIGHLIGHTS (in millions) Six Months Ended June 30, 1994 1993 Revenues $ 774 $ 677 Expenses Wages, salaries and benefits 243 204 Depreciation and amortization 91 87 Other operating expenses 236 230 Total operating expenses 570 521 Operating Income 204 156 Other Income (Expense) (10) (3) Earnings Before Income Taxes $ 194 $ 153
Revenues Revenues for The SABRE Group increased 14.3 percent, $97 million, primarily due to increased booking fee revenues resulting from growth in booking volumes, increases in average fees per booking collected from participating vendors and the introduction of a premium product. Expenses Wages, salaries and benefits increased 19.1 percent, $39 million, due to wage and salary increases and a 7.3 percent increase in the average number of equivalent employees. Other operating expenses increased 2.6 percent, $6 million, due to higher incentive payments to travel agents partially offset by a decrease in maintenance costs on computer equipment.
AMR MANAGEMENT SERVICES GROUP FINANCIAL HIGHLIGHTS (in millions) Six Months Ended June 30, 1994 1993 Revenues $ 258 $ 211 Expenses Wages, salaries and benefits 78 50 Other operating expenses 157 140 Total operating expenses 235 190 Operating Income 23 21 Other Income (Expense) (15) (13) Earnings Before Income Taxes $ 8 $ 8
-11- 14 RESULTS OF OPERATIONS (CONTINUED) Revenues Revenues for the AMR Management Service Group increased 22.3 percent, $47 million. AMR Services' revenues increased 20.5 percent to $165 million, primarily as a result of strong domestic fuel and deicing service sales, expansion of European operations, and the acquisition of an additional domestic fixed-base operator in November 1993. Americas Ground Services, which began operations in the second quarter of 1993, contributed $13 million in revenues. Revenues of AMR Training and Consulting Group, which began operations in the first quarter of 1993, increased by approximately $14 million in the first six months of 1994. Expenses Wages, salaries and benefits increased 56.0 percent, $28 million, due primarily to a 38.5 percent increase in the average number of equivalent employees. Other operating expenses increased 12.1 percent, $17 million, due primarily to the startup of operations for Americas Ground Services and AMR Training and Consulting Group and the expansion of AMR Services. LIQUIDITY AND CAPITAL RESOURCES Net cash provided by operating activities in the six month period ended June 30, 1994, was $992 million compared to $867 million in 1993. Capital expenditures for the first six months of 1994 were $612 million and included the acquisition of 16 jet aircraft by American: two Boeing 757-200, one Boeing 767-300ER and thirteen Fokker 100. AMR Eagle acquired eleven turboprop aircraft: eight Super ATRs and three Saab 340Bs. In the second quarter of 1994 AMR expended $177 million to acquire an approximate one-third economic interest in Canadian Airlines International, Ltd. These expenditures, plus an expansion of certain airport facilities, were financed by internally generated cash and the issuance of long-term debt. -12- 15 PART II Item 6. Exhibits and Reports on Form 8-K (a) Exhibits filed with this report: Part I - Exhibit 11(a): Computation of primary earnings (loss) per share for the three and six months ended June 30, 1994 and 1993. Part I - Exhibit 11(b): Computation of earnings (loss) per share assuming full dilution for the three and six months ended June 30, 1994 and 1993. (b) Reports on Form 8-K or amendments: None. -13- 16 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 BY: /s/ Donald J. Carty Donald J. Carty Executive Vice President and Chief Financial Officer DATE: August 2, 1994 -14- 17 PART I - EXHIBIT 11 (a) AMR CORPORATION Computation of Primary Earnings (Loss) per Share (in millions, except per share amounts)
Three Months Ended Six Months Ended June 30, June 30, 1994 1993 1994 1993 Earnings (loss) as adjusted: Net earnings (loss) $ 153 $ 47 $ 146 $ 25 Less: Preferred dividend requirements 17 17 33 27 Earnings (loss) applicable to common shares $ 136 $ 30 $ 113 $ (2) Shares, as adjusted Average number of shares outstanding 76 75 76 75 Add shares issued upon assumed exercise of dilutive options,stock appreciation rights and warrants and shares assumed issued for deferred stock granted 3 3 2 2 Less assumed treasury shares repurchased (3) (2) (2) (1) Shares, as adjusted 76 76 76 76 Primary earnings (loss) per share $ 1.77 $ 0.39 $ 1.48 $ (0.03)
-15- 18 PART I - EXHIBIT 11 (b) AMR CORPORATION Computation of Earnings (Loss) per Share Assuming Full Dilution (in millions, except per share amounts)
Three Months Ended Six Months Ended June 30, June 30, 1994 1993 1994 1993 Earnings (loss) as adjusted: Net earnings (loss) $ 153 $ 47 $ 146 $ 25 Less: Preferred Dividend Requirements 17 17 33 27 Earnings (loss) applicable to common shares 136 30 113 (2) Adjustments: Add dividends upon assumed conversion of convertible preferred stock 17 - (a) - Earnings (loss), as adjusted $ 153 $ 30 $ 113 $ (2) Shares, as adjusted: Average number of shares outstanding 76 75 76 75 Add shares issued upon: Assumed conversion of preferred stock 14 - (a) - Assumed exercise of dilutive options, stock appreciation rights and warrants and shares assumed issued for deferred stock granted 3 3 2 2 Less assumed treasury shares repurchased (3) (2) (2) (1) Shares, as adjusted 90 76 76 76 Earnings (loss) per share assuming full dilution $ 1.68 $ 0.39 $ 1.48 $ (0.03)
(a) Conversion not assumed as results would be anti- dilutive. -16- EX-27 2
5 1,000,000 6-MOS DEC-31-1994 JUN-30-1994 65 568 1,078 38 680 2,879 20,120 5,983 19,867 4,548 0 2,114 0 1,081 1,204 19,867 0 7,909 0 7,349 0 0 306 250 104 146 0 0 0 146 1.48 1.48
-----END PRIVACY-ENHANCED MESSAGE-----