American Airlines Group Inc. Lowers Upper End of Passenger Growth Forecast

American Airlines (NASDAQ: AAL  ) today announced its June operating results and lowered its forecast for second-quarter growth in passenger revenue per available seat mile.

The company said revenue passenger miles, or RPMs, rose by 1% year over year, to 19.9 billion, in the month, while total available seat miles rose by 3.2%, to 23.4 billion. As a result, its load factor -- the percentage of seats filled by paying passengers -- fell by 1.9 percentage points, to 85%.

International flights were the primary reason for the dip in efficiency. RPMs rose just 0.7%, while available seat miles rose by a staggering 7% to 8.2 billion. The load factor for American Airlines international flights fell from 85.9% in June 2013 to 80.9% last month. This decline primarily came from its Atlantic and Latin America flights, which saw load factors decline by 5.4 and 5.2 percentage points, respectively.

Through the first six months of the year, the dip in load factor is not as significant at the 1.9 percentage-point drop seen in June -- as load factor sits at 82.2%, down 0.4 percentage points relative to the first six months of 2013.

American Airlines also noted it expects second-quarter passenger revenue per available seat mile to rise between 5.5% and 6.5%, year over year. This guidance falls below the 5.5% to 7% gain it projected when it announced traffic results for May.

American Airlines also said it expects to post as much as $630 million in charges in the second quarter, related to fuel hedging contracts and its merger with US Airways. About $330 million of the charges are related to selling its fuel hedging contracts and about $250 million to $300 million is related to its bankruptcy restructuring and merger with US Airways.

-- Material from The Associated Press was used in this report.

Leaked: Apple's next smart device (warning, it may shock you)
Apple recently recruited a secret-development "dream team" to guarantee its newest smart device was kept hidden from the public for as long as possible. And there's one small company making Apple's gadget possible. And its stock price has nearly unlimited room to run for early in-the-know investors. To be one of them, and see Apple's newest smart gizmo, just click here!

Read/Post Comments (0) | Recommend This Article (3)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 3022919, ~/Articles/ArticleHandler.aspx, 8/27/2015 10:50:37 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Patrick Morris

After a few stints in banking and corporate finance, Patrick joined the Motley Fool as a writer covering the financial sector. He's scaled back his everyday writing a bit, but he's always happy to opine on the latest headline news surrounding Berkshire Hathaway, Warren Buffett and all things personal finance.

Today's Market

updated 1 hour ago Sponsored by:
DOW 16,654.77 369.26 2.27%
S&P 500 1,987.66 47.15 2.43%
NASD 4,812.71 115.17 2.45%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

8/27/2015 4:00 PM
AAL $39.03 Up +0.18 +0.46%
American Airlines… CAPS Rating: ***