NEW YORK, Jan 28 — American Airlines reported an US$8.9 billion (RM36 billion) loss for 2020 today due to the coronavirus, but said it expects a rebound to begin later in 2021.
The big US carrier reported a fourth quarter loss of US$2.2 billion, compared with profits of US$414 million in the year-ago period following another big drop in travel demand.
American’s red-ink report comes on the heels of earlier releases from rivals Delta Airlines and United Airlines that show an industry in turmoil after restrictions to contain Covid-19 were enacted across the globe, shutting down or sharply reducing travel.
“Our fourth-quarter financial results close out the most challenging year in our company’s history,” said American Airlines Chief Executive Doug Parker.
“As we look to the year ahead, 2021 will be a year of recovery. While we don’t know exactly when passenger demand will return, as vaccine distribution takes hold and travel restrictions are lifted, we will be ready.”
American’s fourth-quarter revenue fell 64 per cent to US$4.0 billion following much lower ticket sales. Annual revenues dropped 62 per cent to US$17.4 billion.
Like other carriers, American has trimmed its capital budget, retired older aircraft, deferred delivery of new planes and reduced headcount through early retirement.
These efforts have reduced daily cash burn to US$30 million in the fourth quarter from almost US$100 million in April.
American, like its peers, expects a recovery once coronavirus vaccines are widely deployed. But it signalled the first quarter would suffer from the same market conditions as in recent months.
Shares of American jumped 15.3 per cent to US$19.10 in pre-market trading. — AFP
