AMR Corporation Reports 2007 Net Profit of $504 Million

[Boomer]

Nice move by management. If I didn't know better, I'd think that maybe someone at HQ watched Alastair Sim in A Christmas Carol over the Holidays. Better late than never, although it would have been nice if they'd got religion at the end of 2003 instead of waiting four years. Won't make everything all better again, but certainly is an improvement in thinking.

And half a billion in net profit ain't bad, especially considering the lack of consolidation so far and the sky high rise in oil prices. If fuel cost in 2007 what it cost in 2003, the profit would have been several billion dollars.

Pensions funded to 96% ?!? Excellent news! Where's Boomer? I predicted that the pension funding would be close to 100% - it's nice to be right. B)

FWAA,

I'm still here, and no: I'm definitely not stupid.

Back in '05 I started a new career using all of the things I learned at AA. I kept the job at AA like many of my coworkers have- it is just a check, the only things at AA I really care about are the men with whom I have been priviledged to work alongside.

There are far more of us than AA is willing to admit. I no longer need a Union to declare a strike and walk off the job, that is the consensus of those in my position in my workplace.

After more than two years of working multiple jobs and having more than replaced AARPAY at AA, all we need is a trigger...it's not that any of us consider ourselves irreplaceable, it's just the freedom of not relying on this bunch of Ba$tard$ with respect to the conduct of our futures or the welfare of our families.

A successful thief never steals just one time...

The TWU told AA where I lived, for 3 Million bucks, they drove AA to my home and held lookout while AA conducted a HOME INVASION. With my family present and the TWU as lookout, AA held a financial weapon to my head and told me that my signature or my financial future would end up on that paper.

Since that day, the TWU has engorged themselves with payraises while AA has engorged themselves with bonuses...all from the proceeds from my familys' table.

To this day, AA has not and will not divuldge the month by month investments they made through the Pension PlAAn or gaurantee that they have never "booked" expected returns in excess of actual returns in the process of "smoothing" the funded status of the various DBP's on the property by contract. All of those things are perfectly legal...that makes it no more immoral than extorting shared sacrifice while fully knowing that there is really nothing shared.

I will cash the check...it is just a downpayment on the debt.

 

[WingNaPrayer]

I will cash the check...it is just a downpayment on the debt.

Curiosity demands the question . . . will you be charging a late fee?

 

[jimntx]

DITTO


I'll take the money but its going to take more than that to make up for the concessions of 2003

Amen. According to an email from the APFA, the average flight attendant has given up $80,000 in concessions since 2003. So, this is a whole 1% return on our "investment." At last, Mother can have that operation.

 

[1AA]

Nice gesture by AA management, I'll take what ever they give me in monetary compensation.
After all it was my useless TWU that took it all from us not the company. I was surprised that union dues was not deducted from this payout

At least the company is keeping their word on the pension fund. 96% funded is a big achievement in such a short time from what it was five years ago. We all need money now but we must all think about our future if we are going to have one at all. Hopefully the TWU will build on this momentum instead of business as usual for them

 

[WingNaPrayer]

Don't bank on those pension funds just yet. Right now, I look at it as a savings account for AA - just a place to stash some cash for a while. Some of you know what I mean.

 

[Barfbag]

The " R "word keeps appearing more in daily print .............save your money.

 

[Hatu]

Analysts Forecast Bigger Losses for AMR Due to Higher Fuel Costs in 2008


NEW YORK (AP) -- Analysts said Thursday they were surprised by AMR Corp.'s estimate of its 2008 fuel costs, and they predicted larger losses for the American Airlines parent as a result.
On Wednesday, AMR said it expects jet fuel to cost $2.64 per gallon in the first quarter and $2.65 for the full year.

Soleil Research analyst James Higgins said he expected fuel costs to be 8 cents per gallon less than AMR estimates for both the quarter and the year. He now thinks the company will to lose $1.10 per share in 2008, up from his previous estimate of 25 cents per share.

On average, analysts polled by Thomson Financial expect AMR to earn a profit of 79 cents per share for the year, although Thursday's changes were not included in that average.

In addition to jet fuel costs, Higgins said he is concerned about the effects of new competition at London Heathrow Airport. The analyst kept a "Hold" rating on the stock, and suspended his $15 per share target price.

Higgins said the airline should cut its capacity, and he thinks it is likely to do so.

JPMorgan analyst Jamie Baker agreed, predicting AMR will reduce capacity by 3 percent, rather than the 1 percent increase it forecast Wednesday. He now expects the Forth Worth, Texas, company to lose $1.35 per share this year, up from a loss of 27 cents per share. He kept an "Overweight" rating on the stock.

Goldman Sachs analyst Robert Barry, who rates the stock "Sell," widened his loss forecast to $1.40 per share from $1 per share.

http://biz.yahoo.com/ap/080117/amr_ahead_o..._bell.html?.v=1

 

[WingNaPrayer]

The Star Telegram ran some informative articles on this, including talk of the bonuses. Several employees have commented so far, some quite venomous, some grateful.

It was obvious from the start that this financial report was going to cause a lot of mixed emotions. I'm rather impressed at the profits they did post, and all but speechless over the bonus pay out - I'm still holding that in speculation.

What I did find interesting in the articles is the report that AA has already started cancelling several of it's 777 flights beginning in February? They report they are doing so based on expected pilot retirements. Are there no pilots who can move up to keep these flights on the schedule?

AA is predicting a 1% capacity increase while the analysts are saying they are going to have to have at least a 3% reduction.

No one seems to agree on that issue.

LINK to story and employee comments

 

[jimntx]

What I did find interesting in the articles is the report that AA has already started cancelling several of it's 777 flights beginning in February? They report they are doing so based on expected pilot retirements. Are there no pilots who can move up to keep these flights on the schedule?
LINK to story and employee comments

I know of at least 1 furloughed pilot who is working for a regional flying rjs who would LOVE to be recalled. With the increase in retirement age to 65, I'm surprised that they are going to be short of pilots.

 

[eolesen]

Don't bank on those pension funds just yet. Right now, I look at it as a savings account for AA - just a place to stash some cash for a while. Some of you know what I mean.

Queue the black helicopters and tin-foil hats...

So, how exactly do you propose AMR being able to remove cash from their pension funds?

 

[The Dissident]

I noticed the lovefest going on in the beginning of the thread. This was nothing but a PR stunt because it was revealed that Continentals profit sharing is waaay better than AA's.They were shamed into giving it to us. This is just to placate the masses and the public in general to say" See were not all that bad we share with our employees". The sad truth is that after taxes its lust a little over one days pay on overtime. A bribe more or less. We would have had a Real profit sharing if AA hadnt paid 545 million that they didnt have to on some debt. They paid just enough to screw us out of a real bonus while the execs are going to get even bigger bonuses this April.


From the 8K filing
AMR paid off $865 million in debt in the fourth quarter,
including scheduled debt payments and an unscheduled $545 million aircraft debt
prepayment

Once again the ones who actually produce the product are screwed.

 

[WingNaPrayer]

From the 8K filing
AMR paid off $865 million in debt in the fourth quarter,
including scheduled debt payments and an unscheduled $545 million aircraft debt
prepayment

I read the entire 8K also, and saw that debt payment and it immediately struck me the same way - they paid it specifically to avoid PS. However, as will happen now, I knew if I mentioned it right off, the corporate KoolAAid drinkers would have lobbed it with their usual gobblty-goop and made it look like much less that what it really was.

Still, I have to say I DO think the bonus, however small, showed a little class, even if it does have underlying motive behind it. After taxes, it isn't that much, spend it frivolously on yourselves or invest it in as much AMR stock as it will buy - I still think if every employee did that with their bonus it would send one hulluva message.

Now, a message from your resident shills will follow . . . . . .

 

[FWAAA]

I noticed the lovefest going on in the beginning of the thread. This was nothing but a PR stunt because it was revealed that Continentals profit sharing is waaay better than AA's.They were shamed into giving it to us. This is just to placate the masses and the public in general to say" See were not all that bad we share with our employees". The sad truth is that after taxes its lust a little over one days pay on overtime. A bribe more or less. We would have had a Real profit sharing if AA hadnt paid 545 million that they didnt have to on some debt. They paid just enough to screw us out of a real bonus while the execs are going to get even bigger bonuses this April.

Repayment of debt (principal) has nothing to do with reducing profits, regardless of whether the debt is repaid early or as scheduled.

If you're looking for evidence of how management finds it so easy to screw you at every turn, your ignorance of basic financial accounting you display in the bolded portion above is Exhibit A.

When you pre-pay debt (like pay off the car loan early), does that change your income shown on your 1040 for that year? Nope. It just removes cash from your balance sheet and reduces the liability on your balance sheet by the same amount. That's what the early debt repayment did.

Debt pre-payment does one good thing: It reduces interest payments. If you pre-pay your car 8% car loan with savings earning 3%, you're better off. That's what AA did last year. It pre-paid some principal early so it would pay less interest this year and in following years. That will make net income HIGHER in 2008 than it otherwise would have been.

Wouldn't hurt you to see if the local community college has an evening course in introductory financial accounting. Would certainly enable you to read the financial statements correctly and analyze what they show.

No question about it: Management has screwed you in the past and will probably continue to do so in the future. But pre-payment of high interest debt isn't how they do it.

 

[FWAAA]

I read the entire 8K also, and saw that debt payment and it immediately struck me the same way - they paid it specifically to avoid PS. However, as will happen now, I knew if I mentioned it right off, the corporate KoolAAid drinkers would have lobbed it with their usual gobblty-goop and made it look like much less that what it really was.

Still, I have to say I DO think the bonus, however small, showed a little class, even if it does have underlying motive behind it. After taxes, it isn't that much, spend it frivolously on yourselves or invest it in as much AMR stock as it will buy - I still think if every employee did that with their bonus it would send one hulluva message.

Now, a message from your resident shills will follow . . . . . .

Wing, if you really believe that debt prepayment actually reduces net income, then perhaps buying individual stocks isn't an appropriate investment vehicle for you. Maybe a broad-based index fund would be a better idea.

You know what they say about opening one's mouth and removing all doubt . . .

 

[Bob Owens]

I noticed the lovefest going on in the beginning of the thread. This was nothing but a PR stunt because it was revealed that Continentals profit sharing is waaay better than AA's.They were shamed into giving it to us. This is just to placate the masses and the public in general to say" See were not all that bad we share with our employees". The sad truth is that after taxes its lust a little over one days pay on overtime. A bribe more or less. We would have had a Real profit sharing if AA hadnt paid 545 million that they didnt have to on some debt. They paid just enough to screw us out of a real bonus while the execs are going to get even bigger bonuses this April.


From the 8K filing
AMR paid off $865 million in debt in the fourth quarter,
including scheduled debt payments and an unscheduled $545 million aircraft debt
prepayment

Once again the ones who actually produce the product are screwed.

It doesnt come close to covering what they stole from us over the holiday season.

We lost the paid holiday at Thankgiving,the day after, Christmas and New Years. During just these Holidays they took $1540 away from us.

They gave us back $800.

I'll take it but it still doesnt change the fact that we have the worst profit sharing plan, the worst Holiday pay, the worst sick time policy, the worst OT rates, etc of all the majors-including those that went BK.