The Company's cargo revenue declined by 16.4 percent to $164 million in the fourth quarter compared to the same period in 2008.
American's mainline passenger revenue per available seat mile (unit revenue) declined by 4.3 percent in the fourth quarter compared to the year-ago quarter.
While the Company's fourth quarter unit revenue performance continues to reflect the effects of a challenging economy, the Company believes the strength of its network and its efforts to drive a revenue premium helped its mainline unit revenue performance outpace that of most of its legacy network competitors in 2009.
Mainline capacity, or total available seat miles, in the fourth quarter decreased by 4.9 percent compared to the same period in 2008, as the Company continued to exercise capacity discipline given the still-challenging demand environment.
American's mainline load factor - or the percentage of total seats filled - was a record 81.1 percent during the fourth quarter, compared to 78.3 percent in the fourth quarter of 2008. American's fourth quarter yield, which represents average fares paid, decreased by 7.6 percent compared to the fourth quarter of 2008. The decrease in yield was largely due to more aggressive pricing industry-wide and reduced traffic in the premium cabins.
American's mainline cost per available seat mile (unit cost) in the fourth quarter was essentially flat year over year, in part due to lower fuel prices. Taking into account the impact of fuel hedging, AMR paid $2.17 per gallon for jet fuel in the fourth quarter versus $2.60 a gallon in the fourth quarter of 2008, a 16.4 percent decrease. As a result, the Company paid $287 million less for fuel in the fourth quarter of 2009 than it would have paid at prevailing prices from the prior-year period.
Excluding fuel, mainline unit costs in the fourth quarter of 2009 increased by 8.3 percent year over year, driven by reduced capacity, higher pension expenses, higher materials and repairs expenses, and investments in dependability initiatives.
An unaudited summary of full-year 2009 results is available in the tables at the back of this press release.
Balance Sheet Update
AMR ended the fourth quarter with approximately $4.9 billion in cash and short-term investments, including a restricted balance of $460 million, compared to a balance of $3.6 billion in cash and short-term investments, including a restricted balance of $459 million, at the end of the fourth quarter of 2008. In the third and fourth quarters of 2009, the Company closed approximately $5 billion in financing transactions to bolster liquidity, finance the delivery of new Boeing 737-800 aircraft and refinance existing debt maturities.
AMR's Total Debt, which it defines as the aggregate of its long-term debt, capital lease obligations, the principal amount of airport facility tax-exempt bonds, and the present value of aircraft operating lease obligations, was $16.1 billion at the end of the fourth quarter of 2009, compared to $15.1 billion a year earlier.
AMR's Net Debt, which it defines as Total Debt less unrestricted cash and short-term investments, was $11.7 billion at the end of the fourth quarter, compared to $12.0 billion in the fourth quarter of 2008.
Fourth Quarter 2009 Highlights
Mainline and Consolidated Capacity
AMR expects its full-year mainline capacity to increase by 0.9 percent in 2010 compared to 2009, with domestic capacity down 0.5 percent and an increase of international capacity of 3.2 percent compared to 2009 levels. On a consolidated basis, AMR expects full-year capacity to increase by 1.3 percent in 2010 compared to 2009.
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