High fuel costs cut sharply into American Airlines profit
Rehana Begg
CEO Doug Parker says the company will reduce its planned growth, cancel unprofitable flights and delay taking new planes
DALLAS – Higher fuel costs slashed third-quarter profit at American Airlines by nearly half, and the company says it is responding by growing more slowly and cutting unprofitable flights.
The shares are climbing in trading before Thursday’s opening bell.
American Airlines Group Inc. earned $341 million, down 48 per cent from a year ago.
Excluding non-recurring items, American earned $1.13 a share, matching a FactSet forecast.
Revenue is up 5 per cent to $11.56 billion, but fuel is up too – by more than 40 per cent.
CEO Doug Parker says the company will reduce its planned growth, cancel unprofitable flights and delay taking new planes.
American expects a key measure of revenue per seat to rise in the fourth quarter.
Shares are up $1.04, or 3.4 per cent, to $31.38, in early trading.
