American Airlines Reports Growth in Revenue

American Airlines passenger traffic is up for the quarter, rising about 7 percent higher than for the second quarter of 2004.

American Airlines reported a boost in revenue during the second quarter, after a string of fare increases and strong demand for travel in the spring.

Costs, however, are also up, on a sharp increase in fuel prices, according to a report the company filed with the Securities and Exchange Commission late Wednesday.

In the report, the Fort Worth-based airline told the SEC that unit revenues will increase 5 percent to 6 percent for the quarter, compared with the second quarter of 2004.

Passenger traffic is also up for the quarter, rising about 7 percent higher than the second quarter of 2004, according to the airline.

The strong revenue performance comes after several fare increases in March and April. More recently, however, three attempts to increase ticket prices were rescinded after some airlines failed to match the price increases.

On Tuesday and Wednesday, several carriers, including American, Delta Air Lines and United Airlines, raised some fares by as much as 3 percent.

Continental Airlines, Northwest Airlines and US Airways have not matched the increase, said Terry Trippler of Cheapseats.com, an Internet travel firm that monitors airfares.

Although revenue is up, American's costs have also risen. The airline projects that unit costs for the second quarter will be up nearly 6 percent at the main airline, excluding American Eagle. That increase is largely driven by fuel costs.

Jet fuel prices for the quarter are projected to be $1.65 per gallon, up nearly 50 percent compared with a year ago, when American paid $1.11 per gallon.

AMR Corp., American's parent, will release its second-quarter financial results in mid-July. Most analysts are predicting a loss for the quarter.

Wednesday's report was released after the markets closed. AMR's stock (ticker: AMR) closed at $13.14 per share, down 9 cents.

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