AMR fourth quarter loss of $214 million exluding special items

[FWAAA]

http://biz.yahoo.com/prnews/090121/da60760.html?.v=1

Certainly could have been worse. Hope premium class revenue continues to hold up.

 

[SkydrolJunkie]

All right, time to negotiate a new contract. Stalling is over!!

 

[jimntx]

I just read Arpey's message to the employees about the 4th quarter results. Reading between the lines...there is no money for employee raises. However, in appreciation for the employee efforts during the quarter, Arpey promised to think of us each time he exercises a stock option after the April payout.

Addendum: it coulda been worse, people. UAL loss $1.3 billion. Even excluding their fuel hedging losses, they lost $547 million! Yahoo article about UAL

 

[DallasConehead]

Im not surprised, as usual the greedy execs blame everything else except themselves for the poor performance. 23 years and counting....

 

[FrequentFlierCA]

I guess it can always get worse, but losing nearly a quarter billion dollars is not exactly raking in the bucks, as some members of this forum have alleged AMR would do. I want you to have raises, too- but where's the money?

 

[FWAAA]

Let's say that fuel is down by $4 billion in 2009. Assuming that revenue stays roughly the same, wages could easily be raised by $2 billion which would still leave about a billion dollar profit. Dunno if that would pay for "restore and more" but it looks promising.

 

[FrequentFlierCA]

I think that assuming revenue will be similar will turn out to be a very bad assumption.

 

[TIME FOR CHANGE]

I guess it can always get worse, but losing nearly a quarter billion dollars is not exactly raking in the bucks, as some members of this forum have alleged AMR would do. I want you to have raises, too- but where's the money?

Where's the money


Upper management will find the money come April. We can start there. Shell out some more stock.

 

[CubsFanJohn]

I don't work for AA but I can say it could have been A LOT worse. Still not great though.

 

[eolesen]

Your increased revenue is going to employees. Unfortunate for you actives, it's going into Bear's & MCI's pockets:

The largest factor driving increased unit costs is higher pension expense, largely the result of negative investment returns on the Company's pension assets in 2008 related to the broader stock market decline.

At the end of 2008, the accumulated benefit obligation (ABO) funded status of AMR's pension plans was approximately 69 percent, compared to 96 percent at the end of 2007. While a material decline, the Company maintains a conservative investment portfolio with a significant position in U.S. Treasury and U.S. agency bonds.

As a result, the Company believes that its pension funded status declined less than that of many companies with defined benefit pension plans. According to estimates from consulting firm Mercer, the aggregate ABO funded status for plans sponsored by S&P 1500 companies (including their U.S. and non-U.S. plans) declined by approximately 33 percentage points from year-end 2007 to year-end 2008.

Given a choice between underfunded pensions or raises, which would you rather have (trick question, I know.....).

FWAAA, I don't know if premium revenues will hold up or not. I know our travel budget is frozen thru the end of 1Q09 (unless the customer pays up front, and there aren't many willing to do that right now). We made money in 2008 and we fully intend to make money in 2009, so if the economy is further in the tank come March, we freeze travel thru June...

 

[FWAAA]

FWAAA, I don't know if premium revenues will hold up or not. I know our travel budget is frozen thru the end of 1Q09 (unless the customer pays up front, and there aren't many willing to do that right now). We made money in 2008 and we fully intend to make money in 2009, so if the economy is further in the tank come March, we freeze travel thru June...

I agree that the assumption that revenue holds steady may be faulty - my comment was meant to be facetious.

Today, UA reported that its fourth quarter premium cabin demand was off by 25%. Recently, BA announced that its December premium cabin revenue was off by double digits. If those trends hit AA, it's gonna be a rough ride. $400 coach tickets to Europe won't be able to offset large drops in premium cabin traffic.

 

[skydrol]

Your increased revenue is going to employees. Unfortunate for you actives, it's going into Bear's & MCI's pockets:


Given a choice between underfunded pensions or raises, which would you rather have (trick question, I know.....).


Everyone wants to boast about our pension (company and union)

Here is a novel Idea lets put our pension in a trust like the upper management ?????IE bankrupt proof... No instead we have to keep hearing how well funded our pension is, best in industry yada yada.... however for a employee that has vested decades and has decades to go it can always be pulled out from under your feet. LIKE A DREAM... I promise oh sorry i lied . like it was said in the movie "show me the money"

I want this so called pension protected that is part of my compensation.....

 

[Bob Owens]

Let's say that fuel is down by $4 billion in 2009. Assuming that revenue stays roughly the same, wages could easily be raised by $2 billion which would still leave about a billion dollar profit. Dunno if that would pay for "restore and more" but it looks promising.

That would leave around $200,000,000 for the "more" part.

 

[Bob Owens]

FWAAA, I don't know if premium revenues will hold up or not. I know our travel budget is frozen thru the end of 1Q09 (unless the customer pays up front, and there aren't many willing to do that right now). We made money in 2008 and we fully intend to make money in 2009, so if the economy is further in the tank come March, we freeze travel thru June...

Well the airlines are doing fine without you, of the six times I flew in the past three weeks every seat in first was taken as well as most on coach.

 

[FWAAA]

Everyone wants to boast about our pension (company and union)

Here is a novel Idea lets put our pension in a trust like the upper management ?????IE bankrupt proof... No instead we have to keep hearing how well funded our pension is, best in industry yada yada.... however for a employee that has vested decades and has decades to go it can always be pulled out from under your feet. LIKE A DREAM... I promise oh sorry i lied . like it was said in the movie "show me the money"

I want this so called pension protected that is part of my compensation.....

Your post is an excellent example of how and where our education system has failed. Not only that, but Management has failed you by failing to help you understand the pensions. It goes without saying that your worthless union has failed you - where have they not failed you?

Your pension IS in a bankruptcy-proof trust, just like the one established by the execs and partially funded in 2003. Your pension has always been in such a trust. Creditors cannot attach pensions, 401(k)s, IRAs, etc. In extraordinary situations, pensions can be terminated and canceled by bankruptcy courts, like the pilots at UA, US, DL and some others. But the default for all is that they are protected.

Yes, AA's pension funds suffered equity value losses last year, along with everyone else. But as the market recovers, so will the asset values.

AA has no legally-required minimum contributions to the pensions this year because of the 96% funded status earlier. Yes, values have declined. Yesterday, Horton said that the company is currently studying whether to contribute anyway, despite no legal obligation to do so.