American Airlines' stock plummeted on Friday before trading in brand names after the airline lowered its earnings guidance for the year, as well as mentioning significant financial losses due to continued grounding of the Boeing 737 Max and higher fuel prices.
See the airline reports, compared to average analyst estimates compiled by Refinitiv:
- Adjusted earnings: 52 cents vs. 51 cents per share forecast
- Sales: $ 10.58 billion compared to 10 , $ 59 billion
The survey raised its forecast for fuel costs for 2019 by $ 650 million due to higher oil prices.
American Airlines built its 24 Boeing 737 Max jets in August after anti-stable software was identified as problematic in two deadly crashes in Ethiopia and Indonesia. The 155 or so canceled flights per day make up 1.5% of the total capacity per day in the summer.
According to the Americans, first-quarter net income increased to $ 185 million, or 41 cents a share, from $ 159 million, or 34 cents a share, a year earlier. Adjusted earnings were 52 cents a share, outperforming analyst estimates by a penny.
Sales increased 1.8% to $ 10.58 billion from $ 10.4 billion a year ago, with analyst estimates slightly inadvertent.
Revenue per available seat mile, an important industry metric rose 0.5% to 15.87 cents from the previous year. Excluding fuel and special items, the cost per available seat mile was 11.88 cents, a year-on-year increase of 2.7 percent, due to a higher volume of extensive maintenance checks.
Despite challenges, US CEO Doug Parker said demand was strong in the summer. The airline expects revenue, which compares revenue with flight capacity, to increase by between 1% and 3% in the next quarter.
"Looking ahead to 2020 and beyond, we expect our free cash flow production to increase significantly as our historic fleet replacement program expires, and we are very optimistic about our future and value creation our shareholders. " he said.
It is unclear when Max, who has been grounded since mid-March, will return. Several major airlines canceled thousands of flights in the summer. Boeing stopped all deliveries and reduced production by 20%. 96 new flights with a total of 159 hours of airtime were completed with the new fix for the Max software.
Southwest reported Thursday that both the Max grounding and the US government were reportedly stalling and some maintenance issues cost the airline more than $ 200 million in revenue.