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FORM
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10-K
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☒
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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☐
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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American Airlines Group Inc.
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||
(Exact name of registrant as specified in its charter)
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Delaware
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75-1825172
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||||
(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
|
||||
1 Skyview Drive,
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Fort Worth,
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Texas
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76155
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(817)
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963-1234
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(Address of principal executive offices, including zip code)
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Registrant’s telephone number, including area code
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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Common Stock, $0.01 par value per share
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AAL
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The Nasdaq Global Select Market
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American Airlines, Inc.
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||
(Exact name of registrant as specified in its charter)
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||
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Delaware
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13-1502798
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||||
(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
|
||||
1 Skyview Drive,
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Fort Worth,
|
Texas
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76155
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(817)
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963-1234
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(Address of principal executive offices, including zip code)
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Registrant’s telephone number, including area code
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American Airlines Group Inc.
|
Yes
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☒
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No
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☐
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American Airlines, Inc.
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Yes
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☒
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No
|
☐
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American Airlines Group Inc.
|
Yes
|
☐
|
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No
|
☒
|
American Airlines, Inc.
|
Yes
|
☐
|
|
No
|
☒
|
American Airlines Group Inc.
|
Yes
|
☒
|
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No
|
☐
|
American Airlines, Inc.
|
Yes
|
☒
|
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No
|
☐
|
American Airlines Group Inc.
|
Yes
|
☒
|
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No
|
☐
|
American Airlines, Inc.
|
Yes
|
☒
|
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No
|
☐
|
American Airlines Group Inc.
|
☒
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Large accelerated filer
|
☐
|
Accelerated filer
|
☐
|
Non-accelerated filer
|
☐
|
Smaller reporting company
|
☐
|
Emerging growth company
|
American Airlines, Inc.
|
☐
|
Large accelerated filer
|
☐
|
Accelerated filer
|
☒
|
Non-accelerated filer
|
☐
|
Smaller reporting company
|
☐
|
Emerging growth company
|
American Airlines Group Inc.
|
☐
|
|
American Airlines, Inc.
|
☐
|
|
American Airlines Group Inc.
|
Yes
|
☐
|
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No
|
☒
|
American Airlines, Inc.
|
Yes
|
☐
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No
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☒
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Page
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Item 9B.
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||
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Union
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Class or Craft
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|
Employees (1)
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|
Contract
Amendable Date |
|
Mainline:
|
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|
|
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Allied Pilots Association (APA)
|
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Pilots
|
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13,800
|
|
|
2020
|
Association of Professional Flight Attendants (APFA)
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Flight Attendants
|
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25,300
|
|
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2019
|
Airline Customer Service Employee Association – Communications Workers of America and International Brotherhood of Teamsters (CWA-IBT)
|
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Passenger Service
|
|
14,050
|
|
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2020
|
Transport Workers Union and International Association of Machinists & Aerospace Workers (TWU-IAM Association)
|
|
Mechanics and Related
|
|
12,650
|
|
|
2018
|
TWU-IAM Association
|
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Fleet Service
|
|
17,750
|
|
|
2018
|
TWU-IAM Association
|
|
Stock Clerks
|
|
1,850
|
|
|
2018
|
TWU-IAM Association
|
|
Flight Simulator Engineers
|
|
150
|
|
|
2021
|
TWU-IAM Association
|
|
Maintenance Control Technicians
|
|
200
|
|
|
2018
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TWU-IAM Association
|
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Maintenance Training Instructors
|
|
30
|
|
|
2018
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Professional Airline Flight Control Association (PAFCA)
|
|
Dispatchers
|
|
500
|
|
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2021
|
Transport Workers Union (TWU)
|
|
Flight Crew Training Instructors
|
|
350
|
|
|
2021
|
Envoy:
|
|
|
|
|
|
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Air Line Pilots Associations (ALPA)
|
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Pilots
|
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2,250
|
|
|
2024
|
Association of Flight Attendants-CWA (AFA)
|
|
Flight Attendants
|
|
1,650
|
|
|
2020
|
TWU
|
|
Ground School Instructors
|
|
10
|
|
|
2023
|
TWU
|
|
Mechanics and Related
|
|
1,400
|
|
|
2020
|
Union
|
|
Class or Craft
|
|
Employees (1)
|
|
Contract
Amendable Date |
|
TWU
|
|
Stock Clerks
|
|
150
|
|
|
2020
|
TWU
|
|
Fleet Service Clerks
|
|
4,050
|
|
|
2019
|
TWU
|
|
Dispatchers
|
|
70
|
|
|
2025
|
Communications Workers of America (CWA)
|
|
Passenger Service
|
|
6,300
|
|
|
2026
|
Piedmont:
|
|
|
|
|
|
|
|
ALPA
|
|
Pilots
|
|
550
|
|
|
2024
|
AFA
|
|
Flight Attendants
|
|
350
|
|
|
2019
|
International Brotherhood of Teamsters (IBT)
|
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Mechanics
|
|
450
|
|
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2021
|
IBT
|
|
Stock Clerks
|
|
60
|
|
|
2021
|
CWA
|
|
Fleet and Passenger Service
|
|
6,550
|
|
|
2023
|
IBT
|
|
Dispatchers
|
|
30
|
|
|
2019
|
ALPA
|
|
Flight Crew Training Instructors
|
|
40
|
|
|
2024
|
PSA:
|
|
|
|
|
|
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ALPA
|
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Pilots
|
|
1,950
|
|
|
2023
|
AFA
|
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Flight Attendants
|
|
1,450
|
|
|
2023
|
International Association of Machinists & Aerospace Workers (IAM)
|
|
Mechanics
|
|
700
|
|
|
2022
|
TWU
|
|
Dispatchers
|
|
60
|
|
|
2022
|
|
(1)
|
Approximate number of active employees represented as of December 31, 2019.
|
Year
|
Gallons
|
|
Average Price
per Gallon
|
|
Aircraft Fuel
Expense
|
|
Percent of Total
Operating Expenses
|
2019
|
4,537
|
|
$2.07
|
|
$9,395
|
|
22.0%
|
2018
|
4,447
|
|
2.23
|
|
9,896
|
|
23.6%
|
•
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retiring older, less fuel-efficient aircraft and replacing them with new, more fuel-efficient aircraft, resulting in the youngest mainline fleet of any U.S. network carrier;
|
•
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reducing fuel consumption through operational initiatives such as single-engine taxi and engine washing;
|
•
|
working with the FAA and vendors to facilitate efficient airspace procedures, which also reduces aircraft emissions;
|
•
|
updating our fleet with lightweight interiors including seats and furnishings and replacing existing cargo containers with lighter weight versions;
|
•
|
replacing older, inefficient ground support equipment with new, more fuel-efficient ground support equipment, including alternative-fuel and electric powered equipment;
|
•
|
purchasing renewable electricity to reduce indirect emissions associated with the production of the power we consume;
|
•
|
seeking certification of certain of our buildings to the U.S. Green Building Council’s Leadership in Energy and Environmental Design (LEED) standard;
|
•
|
entering into discussions with potential vendors to explore potential production pathways for sustainable alternative aircraft fuel; and
|
•
|
collaborating with airports and other stakeholders to accelerate the introduction of sustainable or lower carbon fuels.
|
•
|
actual or potential changes in international, national, regional and local economic, business and financial conditions, including recession, inflation, higher interest rates, wars, terrorist attacks and political instability;
|
•
|
changes in consumer preferences, perceptions, spending patterns and demographic trends;
|
•
|
changes in the competitive environment due to industry consolidation, changes in airline alliance affiliations, and other factors;
|
•
|
actual or potential disruptions to the ATC systems;
|
•
|
increases in costs of safety, security, and environmental measures;
|
•
|
outbreaks of diseases that affect travel behavior; and
|
•
|
weather and natural disasters, including increases in frequency, severity or duration of such disasters, and related costs caused by more severe weather due to climate change.
|
•
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may make it more difficult for us to satisfy our obligations under our indebtedness;
|
•
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may limit our ability to obtain additional funding for working capital, capital expenditures, acquisitions, investments, integration costs and general corporate purposes, and adversely affect the terms on which such funding can be obtained;
|
•
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require us to dedicate a substantial portion of our cash flow from operations to payments on our indebtedness and other obligations, thereby reducing the funds available for other purposes;
|
•
|
make us more vulnerable to economic downturns, industry conditions and catastrophic external events, particularly relative to competitors with lower relative levels of financial leverage;
|
•
|
significantly constrain our ability to respond, or respond quickly, to unexpected disruptions in our own operations, the U.S. or global economies, or the businesses in which we operate, or to take advantage of opportunities that would improve our business, operations, or competitive position versus other airlines;
|
•
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limit our ability to withstand competitive pressures and reduce our flexibility in responding to changing business and economic conditions;
|
•
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contain covenants requiring us to maintain an aggregate of at least $2.0 billion of unrestricted cash and cash equivalents and amounts available to be drawn under revolving credit facilities; and
|
•
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contain restrictive covenants that could, among other things:
|
◦
|
limit our ability to merge, consolidate, sell assets, incur additional indebtedness, issue preferred stock, make investments and pay dividends; and
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◦
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if breached, result in an event of default under our indebtedness.
|
•
|
changes in law that affect the services that can be offered by airlines in particular markets and at particular airports, or the types of fares offered or fees that can be charged to passengers;
|
•
|
the granting and timing of certain governmental approvals (including antitrust or foreign government approvals) needed for codesharing alliances, joint businesses and other arrangements with other airlines;
|
•
|
restrictions on competitive practices (for example, court orders, or agency regulations or orders, that would curtail an airline’s ability to respond to a competitor);
|
•
|
the adoption of new passenger security standards or regulations that impact customer service standards;
|
•
|
restrictions on airport operations, such as restrictions on the use of slots at airports or the auction or reallocation of slot rights currently held by us; and
|
•
|
the adoption of more restrictive locally-imposed noise restrictions.
|
•
|
macro-economic conditions, including the price of fuel;
|
•
|
changes in market values of airline companies as well as general market conditions;
|
•
|
our operating and financial results failing to meet the expectations of securities analysts or investors;
|
•
|
changes in financial estimates or recommendations by securities analysts;
|
•
|
changes in our level of outstanding indebtedness and other obligations;
|
•
|
changes in our credit ratings;
|
•
|
material announcements by us or our competitors;
|
•
|
expectations regarding our capital deployment program, including any existing or potential future share repurchase programs and any future dividend payments that may be declared by our Board of Directors, or any determination to cease repurchasing stock or paying dividends;
|
•
|
new regulatory pronouncements and changes in regulatory guidelines;
|
•
|
general and industry-specific economic conditions;
|
•
|
changes in our key personnel;
|
•
|
public sales of a substantial number of shares of AAG common stock or issuances of AAG common stock upon the exercise or conversion of restricted stock unit awards, stock appreciation rights, or other securities that may be issued from time to time;
|
•
|
increases or decreases in reported holdings by insiders or other significant stockholders; and
|
•
|
fluctuations in trading volume.
|
•
|
advance notice procedures for stockholder proposals to be considered at stockholders’ meetings;
|
•
|
the ability of our Board of Directors to fill vacancies on the board;
|
•
|
a prohibition against stockholders taking action by written consent;
|
•
|
stockholders are restricted from calling a special meeting unless they hold at least 20% of our outstanding shares and follow the procedures provided for in the amended Bylaws;
|
•
|
a requirement that holders of at least 80% of the voting power of the shares entitled to vote in the election of directors approve any amendment of our Bylaws submitted to stockholders for approval; and
|
•
|
super-majority voting requirements to modify or amend specified provisions of our Certificate of Incorporation.
|
|
Average Seating
Capacity
|
|
Average
Age
(Years)
|
|
Owned
|
|
Leased
|
|
Total
|
|||||
Airbus A319
|
128
|
|
|
15.7
|
|
|
21
|
|
|
111
|
|
|
132
|
|
Airbus A320
|
150
|
|
|
18.7
|
|
|
10
|
|
|
38
|
|
|
48
|
|
Airbus A321
|
179
|
|
|
7.4
|
|
|
165
|
|
|
53
|
|
|
218
|
|
Airbus A321neo
|
196
|
|
|
0.4
|
|
|
2
|
|
|
10
|
|
|
12
|
|
Airbus A330-200
|
247
|
|
|
8.0
|
|
|
15
|
|
|
—
|
|
|
15
|
|
Airbus A330-300
|
291
|
|
|
19.4
|
|
|
4
|
|
|
5
|
|
|
9
|
|
Boeing 737-800
|
163
|
|
|
10.1
|
|
|
132
|
|
|
172
|
|
|
304
|
|
Boeing 737-8 MAX (1)
|
172
|
|
|
1.4
|
|
|
9
|
|
|
15
|
|
|
24
|
|
Boeing 757-200
|
180
|
|
|
20.1
|
|
|
31
|
|
|
3
|
|
|
34
|
|
Boeing 767-300ER
|
209
|
|
|
19.9
|
|
|
17
|
|
|
—
|
|
|
17
|
|
Boeing 777-200ER
|
273
|
|
|
19.0
|
|
|
44
|
|
|
3
|
|
|
47
|
|
Boeing 777-300ER
|
304
|
|
|
5.8
|
|
|
18
|
|
|
2
|
|
|
20
|
|
Boeing 787-8
|
234
|
|
|
4.1
|
|
|
20
|
|
|
—
|
|
|
20
|
|
Boeing 787-9
|
285
|
|
|
2.2
|
|
|
17
|
|
|
5
|
|
|
22
|
|
Embraer 190
|
99
|
|
|
12.1
|
|
|
20
|
|
|
—
|
|
|
20
|
|
Total
|
|
|
11.0
|
|
|
525
|
|
|
417
|
|
|
942
|
|
|
(1)
|
On March 13, 2019, a directive from the FAA grounded all U.S.-registered Boeing 737 MAX aircraft. We have removed all Boeing 737 MAX flying from our flight schedule through August 17, 2020 and will continue to assess this timeline.
|
|
Average Seating
Capacity
|
|
Owned
|
|
Leased
|
|
Owned or Leased
by Third Party
Regional Carrier
|
|
Total
|
|
Operating Regional
Carrier
|
|
Number of
Aircraft
Operated
|
||||||
Bombardier CRJ 200
|
50
|
|
|
12
|
|
|
7
|
|
|
—
|
|
|
19
|
|
|
PSA
|
|
19
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Bombardier CRJ 700
|
66
|
|
|
54
|
|
|
7
|
|
|
60
|
|
|
121
|
|
|
SkyWest
|
|
60
|
|
|
|
|
|
|
|
|
|
|
|
|
PSA
|
|
56
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
Envoy
|
|
5
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
121
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Bombardier CRJ 900
|
77
|
|
|
66
|
|
|
—
|
|
|
60
|
|
|
126
|
|
|
PSA
|
|
66
|
|
|
|
|
|
|
|
|
|
|
|
|
Mesa
|
|
60
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
126
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Embraer E175
|
76
|
|
|
90
|
|
|
—
|
|
|
85
|
|
|
175
|
|
|
Republic
|
|
85
|
|
|
|
|
|
|
|
|
|
|
|
|
Envoy
|
|
70
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
Compass
|
|
20
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
175
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Embraer ERJ 140 (1)
|
44
|
|
|
46
|
|
|
—
|
|
|
—
|
|
|
46
|
|
|
Envoy
|
|
46
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Embraer ERJ 145
|
50
|
|
|
118
|
|
|
—
|
|
|
—
|
|
|
118
|
|
|
Piedmont
|
|
60
|
|
|
|
|
|
|
|
|
|
|
|
|
Envoy
|
|
58
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
118
|
|
|||||
Total
|
|
|
386
|
|
|
14
|
|
|
205
|
|
|
605
|
|
|
|
|
605
|
|
|
(1)
|
Excluded from the total operating aircraft count above are 12 owned Embraer ERJ 140s that are being held in temporary storage.
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
2024
|
|
2025 and Thereafter
|
|
Total
|
|||||||
Airbus
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
A320neo Family (2)
|
18
|
|
|
15
|
|
|
25
|
|
|
8
|
|
|
22
|
|
|
20
|
|
|
108
|
|
Boeing
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
737 MAX Family (3)
|
22
|
|
|
14
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
40
|
|
|
76
|
|
787 Family
|
12
|
|
|
10
|
|
|
—
|
|
|
6
|
|
|
6
|
|
|
13
|
|
|
47
|
|
Embraer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
E175
|
14
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14
|
|
Bombardier
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
CRJ900
|
3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
Total
|
69
|
|
|
39
|
|
|
25
|
|
|
14
|
|
|
28
|
|
|
73
|
|
|
248
|
|
|
(1)
|
Delivery schedule represents our best estimate as of the date of this report. Actual delivery dates are subject to change based on many potential factors including production delays by the manufacturer.
|
(2)
|
In October 2019, the Office of the U.S. Trade Representative announced a 10% tariff on new Airbus aircraft imported from Europe. Effective March 18, 2020, this tariff rate will increase to 15%. We are evaluating the impact of this tariff on our future Airbus deliveries. See Part I, Item 1A. Risk Factors - “We operate a global business with international operations that are subject to economic and political instability and have been, and in the future may continue to be, adversely affected by numerous events, circumstances or government actions beyond our control.”
|
(3)
|
On March 13, 2019, a directive from the FAA grounded all U.S.-registered Boeing 737 MAX aircraft. We currently have 76 Boeing 737 MAX Family aircraft on order and we have not taken delivery of any Boeing 737 MAX Family aircraft since the grounding. The extent of the delay to the scheduled deliveries of the Boeing 737 MAX aircraft included in the table above is expected to be impacted by the length of time the FAA order remains in place, Boeing's production rate and the pace at which Boeing can deliver aircraft following the lifting of the FAA order, among other factors. The above table reflects our estimate of future Boeing 737 MAX aircraft deliveries based on information currently available to us; however, the actual delivery schedule may differ from the table above, potentially materially.
|
ITEM 5.
|
MARKET FOR AMERICAN AIRLINES GROUP’S COMMON STOCK, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
|
|
12/31/2014
|
|
12/31/2015
|
|
12/31/2016
|
|
12/31/2017
|
|
12/31/2018
|
|
12/31/2019
|
||||||||||||
American Airlines Group Inc. (AAL)
|
$
|
100
|
|
|
$
|
80
|
|
|
$
|
89
|
|
|
$
|
100
|
|
|
$
|
62
|
|
|
$
|
56
|
|
NYSE ARCA Airline Index (XAL)
|
100
|
|
|
83
|
|
|
106
|
|
|
112
|
|
|
87
|
|
|
106
|
|
||||||
S&P 500 Index (GSPC)
|
100
|
|
|
99
|
|
|
109
|
|
|
130
|
|
|
122
|
|
|
157
|
|
Period
|
|
Total number of
shares purchased
|
|
Average price
paid per share
|
|
Total number of shares
purchased as part of
publicly announced
plan or program
|
|
Maximum dollar value of shares
that may be purchased under
the plan or program
(in millions)
|
October 2019
|
|
710,556
|
|
$30.65
|
|
710,556
|
|
$828
|
November 2019
|
|
4,181,541
|
|
$29.42
|
|
4,181,541
|
|
$705
|
December 2019
|
|
4,975,466
|
|
$28.12
|
|
4,975,466
|
|
$565
|
|
Year Ended December 31,
|
||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||||
|
(In millions, except share and per share amounts)
|
||||||||||||||||||
Consolidated Statements of Operations data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Total operating revenues
|
$
|
45,768
|
|
|
$
|
44,541
|
|
|
$
|
42,622
|
|
|
$
|
40,142
|
|
|
$
|
40,990
|
|
Total operating expenses
|
42,703
|
|
|
41,885
|
|
|
38,391
|
|
|
35,082
|
|
|
34,786
|
|
|||||
Operating income
|
3,065
|
|
|
2,656
|
|
|
4,231
|
|
|
5,060
|
|
|
6,204
|
|
|||||
Net income
|
1,686
|
|
|
1,412
|
|
|
1,282
|
|
|
2,584
|
|
|
7,610
|
|
|||||
Earnings per common share:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
$
|
3.80
|
|
|
$
|
3.04
|
|
|
$
|
2.62
|
|
|
$
|
4.68
|
|
|
$
|
11.39
|
|
Diluted
|
3.79
|
|
|
3.03
|
|
|
2.61
|
|
|
4.65
|
|
|
11.07
|
|
|||||
Shares used for computation (in thousands):
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
443,363
|
|
|
464,236
|
|
|
489,164
|
|
|
552,308
|
|
|
668,393
|
|
|||||
Diluted
|
444,269
|
|
|
465,660
|
|
|
491,692
|
|
|
556,099
|
|
|
687,355
|
|
|||||
Cash dividends declared per common share
|
$
|
0.40
|
|
|
$
|
0.40
|
|
|
$
|
0.40
|
|
|
$
|
0.40
|
|
|
$
|
0.40
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Consolidated Balance Sheet data
(at end of period):
|
|
|
|
|
|
|
|
|
|
||||||||||
Total assets
|
$
|
59,995
|
|
|
$
|
60,580
|
|
|
$
|
52,785
|
|
|
$
|
53,610
|
|
|
$
|
48,415
|
|
Debt and finance leases
|
24,315
|
|
|
24,473
|
|
|
25,065
|
|
|
24,344
|
|
|
20,561
|
|
|||||
Pension and postretirement obligations (1)
|
6,081
|
|
|
6,937
|
|
|
7,596
|
|
|
7,946
|
|
|
7,566
|
|
|||||
Operating lease liabilities
|
9,129
|
|
|
9,556
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Stockholders’ equity (deficit)
|
(118
|
)
|
|
(169
|
)
|
|
(780
|
)
|
|
(286
|
)
|
|
5,635
|
|
|
(1)
|
Substantially all defined benefit pension plans were frozen effective November 1, 2012. See Note 10 to AAG's Consolidated Financial Statements in Part II, Item 8A for further information on pension and postretirement benefits.
|
|
Year Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(In millions)
|
||||||
Components of Total Special Items, Net: (1)
|
|
|
|
||||
Fleet restructuring expenses (2)
|
$
|
271
|
|
|
$
|
422
|
|
Fleet impairment (3)
|
213
|
|
|
—
|
|
||
Merger integration expenses (4)
|
191
|
|
|
268
|
|
||
Litigation reserve adjustments
|
(53
|
)
|
|
45
|
|
||
Mark-to-market adjustments on bankruptcy obligations, net (5)
|
(11
|
)
|
|
(76
|
)
|
||
Severance expenses (6)
|
11
|
|
|
58
|
|
||
Intangible asset impairment (7)
|
—
|
|
|
26
|
|
||
Labor contract expenses
|
—
|
|
|
13
|
|
||
Other operating charges, net
|
13
|
|
|
31
|
|
||
Mainline operating special items, net
|
635
|
|
|
787
|
|
||
Regional operating special items, net
|
6
|
|
|
6
|
|
||
Operating special items, net
|
641
|
|
|
793
|
|
||
Debt refinancing and extinguishment charges
|
16
|
|
|
13
|
|
||
Mark-to-market adjustments on equity and other investments, net (8)
|
(5
|
)
|
|
104
|
|
||
Other nonoperating income, net
|
(8
|
)
|
|
(4
|
)
|
||
Nonoperating special items, net
|
3
|
|
|
113
|
|
||
Pre-tax special items, net
|
644
|
|
|
906
|
|
||
Income tax special items, net (9)
|
—
|
|
|
18
|
|
||
Total special items, net
|
$
|
644
|
|
|
$
|
924
|
|
|
|
|
|
||||
Reconciliation of Pre-Tax Income Excluding Net Special Items:
|
|
|
|
||||
Pre-tax income – GAAP
|
$
|
2,256
|
|
|
$
|
1,884
|
|
Adjusted for: Pre-tax special items, net
|
644
|
|
|
906
|
|
||
Pre-tax income excluding net special items
|
$
|
2,900
|
|
|
$
|
2,790
|
|
|
|
|
|
||||
Reconciliation of Net Income Excluding Net Special Items:
|
|
|
|
||||
Net income – GAAP
|
$
|
1,686
|
|
|
$
|
1,412
|
|
Adjusted for: Total special items, net
|
644
|
|
|
924
|
|
||
Adjusted for: Net tax effect of net special items
|
(151
|
)
|
|
(219
|
)
|
||
Net income excluding net special items
|
$
|
2,179
|
|
|
$
|
2,117
|
|
|
(1)
|
See Note 2 to AAG’s Consolidated Financial Statements in Part II, Item 8A for further information on net special items.
|
(2)
|
Fleet restructuring expenses principally included accelerated depreciation and rent expense for aircraft and related equipment grounded or expected to be grounded earlier than planned.
|
(3)
|
Fleet impairment principally includes a non-cash write-down of aircraft related to the planned retirement of our Embraer E190 fleet.
|
(4)
|
Merger integration expenses included costs associated with integration projects, principally our technical operations, flight attendant, human resources and payroll systems.
|
(5)
|
Bankruptcy obligations that will be settled in shares of our common stock are marked-to-market based on our stock price.
|
(6)
|
Severance expenses primarily included costs associated with reductions of management and support staff team members.
|
(7)
|
Intangible asset impairment includes a non-cash charge to write-off our Brazil route authority as a result of the U.S.-Brazil open skies agreement.
|
(8)
|
Mark-to-market adjustments on equity and other investments, net primarily relates to net unrealized gains and losses associated with our equity investment in China Southern Airlines.
|
(9)
|
Income tax special items, net for 2018 included an $18 million charge related to an international income tax matter.
|
|
Year Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
Reconciliation of Total Operating Costs per Available Seat
Mile (CASM) Excluding Net Special Items and Fuel: |
|
|
|
||||
(In millions)
|
|
|
|
||||
Total operating expenses - GAAP
|
$
|
42,703
|
|
|
$
|
41,885
|
|
Operating net special items (1):
|
|
|
|
||||
Mainline operating special items, net
|
(635
|
)
|
|
(787
|
)
|
||
Regional operating special items, net
|
(6
|
)
|
|
(6
|
)
|
||
Fuel:
|
|
|
|
||||
Aircraft fuel and related taxes - mainline
|
(7,526
|
)
|
|
(8,053
|
)
|
||
Aircraft fuel and related taxes - regional
|
(1,869
|
)
|
|
(1,843
|
)
|
||
Total operating expenses, excluding net special items and fuel
|
$
|
32,667
|
|
|
$
|
31,196
|
|
(In millions)
|
|
|
|
||||
Total Available Seat Miles (ASM)
|
285,088
|
|
|
282,054
|
|
||
(In cents)
|
|
|
|
||||
Total operating CASM
|
14.98
|
|
|
14.85
|
|
||
Operating net special items per ASM (1):
|
|
|
|
||||
Mainline operating special items, net
|
(0.22
|
)
|
|
(0.28
|
)
|
||
Regional operating special items, net
|
—
|
|
|
—
|
|
||
Fuel per ASM:
|
|
|
|
||||
Aircraft fuel and related taxes - mainline
|
(2.64
|
)
|
|
(2.86
|
)
|
||
Aircraft fuel and related taxes - regional
|
(0.66
|
)
|
|
(0.65
|
)
|
||
Total CASM, excluding net special items and fuel
|
11.46
|
|
|
11.06
|
|
|
(1)
|
See Note 2 to AAG’s Consolidated Financial Statements in Part II, Item 8A for further information on net special items.
|
|
Year Ended December 31,
|
||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Consolidated Statements of Operations data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Total operating revenues
|
$
|
45,761
|
|
|
$
|
44,530
|
|
|
$
|
42,610
|
|
|
$
|
40,125
|
|
|
$
|
40,938
|
|
Total operating expenses
|
42,714
|
|
|
41,807
|
|
|
38,405
|
|
|
35,045
|
|
|
34,749
|
|
|||||
Operating income
|
3,047
|
|
|
2,723
|
|
|
4,205
|
|
|
5,080
|
|
|
6,189
|
|
|||||
Net income
|
1,972
|
|
|
1,658
|
|
|
1,285
|
|
|
2,689
|
|
|
8,120
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Consolidated Balance Sheet data
(at end of period):
|
|
|
|
|
|
|
|
|
|
||||||||||
Total assets
|
$
|
71,890
|
|
|
$
|
70,878
|
|
|
$
|
61,401
|
|
|
$
|
60,428
|
|
|
$
|
50,439
|
|
Debt and finance leases
|
23,042
|
|
|
23,197
|
|
|
23,294
|
|
|
22,577
|
|
|
18,826
|
|
|||||
Pension and postretirement obligations (1)
|
6,037
|
|
|
6,893
|
|
|
7,550
|
|
|
7,904
|
|
|
7,526
|
|
|||||
Operating lease liabilities
|
9,083
|
|
|
9,496
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Stockholder’s equity
|
13,422
|
|
|
11,770
|
|
|
9,888
|
|
|
8,578
|
|
|
9,698
|
|
|
(1)
|
Substantially all defined benefit pension plans were frozen effective November 1, 2012. See Note 8 to American's Consolidated Financial Statements in Part II, Item 8B for further information on pension and postretirement benefits.
|
|
Year Ended
December 31,
|
|
Increase
(Decrease)
|
|
Percent
Increase
(Decrease)
|
|||||||||
|
2019
|
|
2018
|
|
||||||||||
|
(In millions, except percentage changes)
|
|||||||||||||
Passenger revenue
|
$
|
42,010
|
|
|
$
|
40,676
|
|
|
$
|
1,334
|
|
|
3.3
|
|
Cargo revenue
|
863
|
|
|
1,013
|
|
|
(150
|
)
|
|
(14.8
|
)
|
|||
Other operating revenue
|
2,895
|
|
|
2,852
|
|
|
43
|
|
|
1.5
|
|
|||
Total operating revenues
|
45,768
|
|
|
44,541
|
|
|
1,227
|
|
|
2.8
|
|
|||
Mainline and regional aircraft fuel and related taxes
|
9,395
|
|
|
9,896
|
|
|
(501
|
)
|
|
(5.1
|
)
|
|||
Salaries, wages and benefits
|
12,609
|
|
|
12,251
|
|
|
358
|
|
|
2.9
|
|
|||
Total operating expenses
|
42,703
|
|
|
41,885
|
|
|
818
|
|
|
2.0
|
|
|||
Operating income
|
3,065
|
|
|
2,656
|
|
|
409
|
|
|
15.4
|
|
|||
Pre-tax income
|
2,256
|
|
|
1,884
|
|
|
372
|
|
|
19.7
|
|
|||
Income tax provision
|
570
|
|
|
472
|
|
|
98
|
|
|
20.7
|
|
|||
Net income
|
1,686
|
|
|
1,412
|
|
|
274
|
|
|
19.4
|
|
|||
|
|
|
|
|
|
|
|
|||||||
Pre-tax income – GAAP
|
$
|
2,256
|
|
|
$
|
1,884
|
|
|
$
|
372
|
|
|
19.7
|
|
Adjusted for: Pre-tax net special items (1)
|
644
|
|
|
906
|
|
|
(262
|
)
|
|
(28.9
|
)
|
|||
Pre-tax income excluding net special items
|
$
|
2,900
|
|
|
$
|
2,790
|
|
|
$
|
110
|
|
|
3.9
|
|
|
(1)
|
See Part II, Item 6. Selected Consolidated Financial Data – “Reconciliation of GAAP to Non-GAAP Financial Measures” and Note 2 to AAG’s Consolidated Financial Statements in Part II, Item 8A for details on the components of net special items.
|
•
|
raised $3.2 billion from enhanced equipment trust certificates (EETCs) and other aircraft and flight equipment financing, of which $1.3 billion was used to repay existing indebtedness;
|
•
|
issued $750 million in aggregate principal amount of 5.000% senior notes due 2022 (the 5.000% senior notes);
|
•
|
raised $850 million from aircraft sale-leaseback transactions; and
|
•
|
extended the maturities on $2.8 billion of our revolving credit facility commitments by one year from 2023 to 2024, and due to uncertainty surrounding the timing of the Boeing 737 MAX aircraft return to service, entered into an additional $400 million short-term revolving line of credit.
|
|
Year Ended December 31,
|
|
Increase (Decrease)
|
||||
|
2019
|
|
2018
|
|
|||
Revenue passenger miles (millions) (a)
|
241,252
|
|
|
231,160
|
|
|
4.4%
|
Available seat miles (millions) (b)
|
285,088
|
|
|
282,054
|
|
|
1.1%
|
Passenger load factor (percent) (c)
|
84.6
|
|
|
82.0
|
|
|
2.6pts
|
Yield (cents) (d)
|
17.41
|
|
|
17.60
|
|
|
(1.0)%
|
Passenger revenue per available seat mile (cents) (e)
|
14.74
|
|
|
14.42
|
|
|
2.2%
|
Total revenue per available seat mile (cents) (f)
|
16.05
|
|
|
15.79
|
|
|
1.7%
|
Aircraft at end of period (g)
|
1,547
|
|
|
1,551
|
|
|
(0.3)%
|
Fuel consumption (gallons in millions)
|
4,537
|
|
|
4,447
|
|
|
2.0%
|
Average aircraft fuel price including related taxes (dollars per gallon)
|
2.07
|
|
|
2.23
|
|
|
(6.9)%
|
Full-time equivalent employees at end of period
|
133,700
|
|
|
128,900
|
|
|
3.7%
|
Operating cost per available seat mile (cents) (h)
|
14.98
|
|
|
14.85
|
|
|
0.9%
|
|
(a)
|
Revenue passenger mile (RPM) – A basic measure of sales volume. One RPM represents one passenger flown one mile.
|
(b)
|
Available seat mile (ASM) – A basic measure of production. One ASM represents one seat flown one mile.
|
(c)
|
Passenger load factor – The percentage of available seats that are filled with revenue passengers.
|
(d)
|
Yield – A measure of airline revenue derived by dividing passenger revenue by RPMs.
|
(e)
|
Passenger revenue per available seat mile (PRASM) – Passenger revenue divided by ASMs.
|
(f)
|
Total revenue per available seat mile (TRASM) – Total revenues divided by ASMs.
|
(g)
|
Includes aircraft owned and leased by American as well as aircraft operated by third-party regional carriers under capacity purchase agreements. Excludes 12 Embraer E140 regional aircraft that are in temporary storage.
|
(h)
|
Operating cost per available seat mile (CASM) – Operating expenses divided by ASMs.
|
|
Year Ended December 31,
|
|
Increase
(Decrease)
|
|
Percent
Increase
(Decrease)
|
|||||||||
|
2019
|
|
2018
|
|
||||||||||
|
(In millions, except percentage changes)
|
|||||||||||||
Passenger
|
$
|
42,010
|
|
|
$
|
40,676
|
|
|
$
|
1,334
|
|
|
3.3
|
|
Cargo
|
863
|
|
|
1,013
|
|
|
(150
|
)
|
|
(14.8
|
)
|
|||
Other
|
2,895
|
|
|
2,852
|
|
|
43
|
|
|
1.5
|
|
|||
Total operating revenues
|
$
|
45,768
|
|
|
$
|
44,541
|
|
|
$
|
1,227
|
|
|
2.8
|
|
|
|
|
Increase (Decrease)
vs. Year Ended December 31, 2018 |
||||||||||||
|
Year Ended December 31, 2019
|
|
Passenger
Revenue
|
|
RPMs
|
|
ASMs
|
|
Load
Factor
|
|
Passenger
Yield
|
|
PRASM
|
||
|
(In millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Passenger revenue
|
$
|
42,010
|
|
|
3.3%
|
|
4.4%
|
|
1.1%
|
|
2.6pts
|
|
(1.0)%
|
|
2.2%
|
|
Year Ended December 31,
|
|
Increase
(Decrease) |
|
Percent
Increase (Decrease) |
|||||||||
|
2019
|
|
2018
|
|
||||||||||
|
(In millions, except percentage changes)
|
|||||||||||||
Aircraft fuel and related taxes
|
$
|
7,526
|
|
|
$
|
8,053
|
|
|
$
|
(527
|
)
|
|
(6.5
|
)
|
Salaries, wages and benefits
|
12,609
|
|
|
12,251
|
|
|
358
|
|
|
2.9
|
|
|||
Maintenance, materials and repairs
|
2,380
|
|
|
2,050
|
|
|
330
|
|
|
16.1
|
|
|||
Other rent and landing fees
|
2,055
|
|
|
1,900
|
|
|
155
|
|
|
8.2
|
|
|||
Aircraft rent
|
1,326
|
|
|
1,264
|
|
|
62
|
|
|
4.9
|
|
|||
Selling expenses
|
1,602
|
|
|
1,520
|
|
|
82
|
|
|
5.4
|
|
|||
Depreciation and amortization
|
1,982
|
|
|
1,839
|
|
|
143
|
|
|
7.7
|
|
|||
Mainline operating special items, net
|
635
|
|
|
787
|
|
|
(152
|
)
|
|
(19.4
|
)
|
|||
Other
|
5,087
|
|
|
5,088
|
|
|
(1
|
)
|
|
—
|
|
|||
Regional expenses:
|
|
|
|
|
|
|
|
|||||||
Aircraft fuel and related taxes
|
1,869
|
|
|
1,843
|
|
|
26
|
|
|
1.4
|
|
|||
Other
|
5,632
|
|
|
5,290
|
|
|
342
|
|
|
6.5
|
|
|||
Total operating expenses
|
$
|
42,703
|
|
|
$
|
41,885
|
|
|
$
|
818
|
|
|
2.0
|
|
|
Year Ended December 31,
|
|
Percent
Increase
(Decrease)
|
|||||
|
2019
|
|
2018
|
|
||||
|
(In cents, except percentage changes)
|
|||||||
Total CASM:
|
|
|
|
|
|
|||
Aircraft fuel and related taxes
|
2.64
|
|
|
2.86
|
|
|
(7.5
|
)
|
Salaries, wages and benefits
|
4.42
|
|
|
4.34
|
|
|
1.8
|
|
Maintenance, materials and repairs
|
0.83
|
|
|
0.73
|
|
|
14.9
|
|
Other rent and landing fees
|
0.72
|
|
|
0.67
|
|
|
7.0
|
|
Aircraft rent
|
0.47
|
|
|
0.45
|
|
|
3.8
|
|
Selling expenses
|
0.56
|
|
|
0.54
|
|
|
4.3
|
|
Depreciation and amortization
|
0.70
|
|
|
0.65
|
|
|
6.6
|
|
Special items, net
|
0.22
|
|
|
0.28
|
|
|
(20.2
|
)
|
Other
|
1.78
|
|
|
1.80
|
|
|
(1.1
|
)
|
Regional expenses:
|
|
|
|
|
|
|||
Aircraft fuel and related taxes
|
0.66
|
|
|
0.65
|
|
|
0.3
|
|
Other
|
1.98
|
|
|
1.88
|
|
|
5.3
|
|
Total CASM
|
14.98
|
|
|
14.85
|
|
|
0.9
|
|
Mainline operating special items, net
|
(0.22
|
)
|
|
(0.28
|
)
|
|
(20.2
|
)
|
Aircraft fuel and related taxes
|
|
|
|
|
|
|
|
|
Aircraft fuel and related taxes - mainline
|
(2.64
|
)
|
|
(2.86
|
)
|
|
(7.5
|
)
|
Aircraft fuel and related taxes - regional
|
(0.66
|
)
|
|
(0.65
|
)
|
|
0.3
|
|
Total CASM, excluding net special items and fuel
|
11.46
|
|
|
11.06
|
|
|
3.6
|
|
•
|
Mainline aircraft fuel and related taxes per ASM decreased 7.5% in 2019 as compared to 2018 primarily due to a 7.1% decrease in the average price per gallon of fuel including related taxes to $2.05 in 2019 from $2.21 in 2018.
|
•
|
Maintenance, materials and repairs per ASM increased 14.9% in 2019 as compared to 2018 primarily due to a contract change that resulted in certain flight equipment transitioning to a flight hour based contract (referred to as power by the hour) whereby expense is incurred and recognized based on actual hours flown. Previously, this flight equipment was covered by a time and materials based contract whereby expense is incurred and recognized as maintenance is performed. An increase in the volume of airframe and engine overhauls performed under time and material based contracts as well as an increase in the volume of component part repairs also drove higher maintenance expenses in 2019.
|
•
|
Other rent and landing fees per ASM increased 7.0% in 2019 as compared to 2018 primarily due to an expansion at DFW that became fully operational in May 2019 and rate increases at certain hub airports.
|
•
|
Depreciation and amortization per ASM increased 6.6% in 2019 as compared to 2018 due in part to airport and other facility improvements and the harmonization of interior configurations across the mainline fleet. Depreciation associated with aircraft acquired as part of our fleet renewal program also contributed to the increase.
|
•
|
Regional aircraft fuel and related taxes per ASM increased 0.3% in 2019 as compared to 2018 primarily due to an 8.3% increase in gallons of fuel consumed, offset in part by a 6.4% decrease in the average price per gallon of fuel including related taxes to $2.15 in 2019 from $2.30 in 2018.
|
•
|
Regional other operating expenses per ASM increased 5.3% in 2019 as compared to 2018 primarily driven by an 8.3% increase in regional capacity, principally from our wholly-owned regional carriers.
|
|
Year Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(In millions)
|
||||||
Fleet restructuring expenses (1)
|
$
|
271
|
|
|
$
|
422
|
|
Fleet impairment (2)
|
213
|
|
|
—
|
|
||
Merger integration expenses (3)
|
191
|
|
|
268
|
|
||
Litigation reserve adjustments
|
(53
|
)
|
|
45
|
|
||
Mark-to-market adjustments on bankruptcy obligations, net (4)
|
(11
|
)
|
|
(76
|
)
|
||
Severance expenses (5)
|
11
|
|
|
58
|
|
||
Intangible asset impairment (6)
|
—
|
|
|
26
|
|
||
Labor contract expenses
|
—
|
|
|
13
|
|
||
Other operating charges, net
|
13
|
|
|
31
|
|
||
Total mainline operating special items, net
|
635
|
|
|
787
|
|
||
Regional operating special items, net
|
6
|
|
|
6
|
|
||
Total operating special items, net
|
$
|
641
|
|
|
$
|
793
|
|
|
(1)
|
Fleet restructuring expenses principally included accelerated depreciation and rent expense for aircraft and related equipment grounded or expected to be grounded earlier than planned.
|
(2)
|
Fleet impairment principally includes a non-cash write-down of aircraft related to the planned retirement of our Embraer E190 fleet.
|
(3)
|
Merger integration expenses included costs associated with integration projects, principally our technical operations, flight attendant, human resources and payroll systems.
|
(4)
|
Bankruptcy obligations that will be settled in shares of our common stock are marked-to-market based on our stock price.
|
(5)
|
Severance expenses primarily included costs associated with reductions of management and support staff team members.
|
(6)
|
Intangible asset impairment includes a non-cash charge to write-off our Brazil route authority as a result of the U.S.-Brazil open skies agreement.
|
|
Year Ended December 31,
|
|
Increase
(Decrease)
|
|
Percent
Increase
(Decrease)
|
|||||||||
|
2019
|
|
2018
|
|
||||||||||
|
(In millions, except percentage changes)
|
|||||||||||||
Interest income
|
$
|
127
|
|
|
$
|
118
|
|
|
$
|
9
|
|
|
7.1
|
|
Interest expense, net
|
(1,095
|
)
|
|
(1,056
|
)
|
|
(39
|
)
|
|
3.7
|
|
|||
Other income, net
|
159
|
|
|
166
|
|
|
(7
|
)
|
|
(3.8
|
)
|
|||
Total nonoperating expense, net
|
$
|
(809
|
)
|
|
$
|
(772
|
)
|
|
$
|
(37
|
)
|
|
4.8
|
|
|
Year Ended December 31,
|
|
Increase
(Decrease)
|
|
Percent
Increase
(Decrease)
|
||||||||
|
2019
|
|
2018
|
|
|||||||||
|
(In millions, except percentage changes)
|
||||||||||||
Passenger
|
$
|
42,010
|
|
|
$
|
40,676
|
|
|
$
|
1,334
|
|
|
3.3
|
Cargo
|
863
|
|
|
1,013
|
|
|
(150
|
)
|
|
(14.8)
|
|||
Other
|
2,888
|
|
|
2,841
|
|
|
47
|
|
|
1.7
|
|||
Total operating revenues
|
$
|
45,761
|
|
|
$
|
44,530
|
|
|
$
|
1,231
|
|
|
2.8
|
|
Year Ended
December 31,
|
|
Increase
(Decrease)
|
|
Percent
Increase
(Decrease)
|
|||||||||
|
2019
|
|
2018
|
|
||||||||||
|
(In millions, except percentage changes)
|
|||||||||||||
Aircraft fuel and related taxes
|
$
|
7,526
|
|
|
$
|
8,053
|
|
|
$
|
(527
|
)
|
|
(6.5)
|
|
Salaries, wages and benefits
|
12,600
|
|
|
12,240
|
|
|
360
|
|
|
2.9
|
|
|||
Maintenance, materials and repairs
|
2,380
|
|
|
2,050
|
|
|
330
|
|
|
16.1
|
|
|||
Other rent and landing fees
|
2,055
|
|
|
1,900
|
|
|
155
|
|
|
8.2
|
|
|||
Aircraft rent
|
1,326
|
|
|
1,264
|
|
|
62
|
|
|
4.9
|
|
|||
Selling expenses
|
1,602
|
|
|
1,520
|
|
|
82
|
|
|
5.4
|
|
|||
Depreciation and amortization
|
1,982
|
|
|
1,839
|
|
|
143
|
|
|
7.7
|
|
|||
Mainline operating special items, net
|
635
|
|
|
787
|
|
|
(152
|
)
|
|
(19.4)
|
|
|||
Other
|
5,090
|
|
|
5,090
|
|
|
—
|
|
|
—
|
|
|||
Regional expenses:
|
|
|
|
|
|
|
|
|||||||
Aircraft fuel and related taxes
|
1,869
|
|
|
1,843
|
|
|
26
|
|
|
1.4
|
|
|||
Other
|
5,649
|
|
|
5,221
|
|
|
428
|
|
|
8.2
|
|
|||
Total operating expenses
|
$
|
42,714
|
|
|
$
|
41,807
|
|
|
$
|
907
|
|
|
2.2
|
|
•
|
Mainline aircraft fuel and related taxes decreased 6.5% in 2019 as compared to 2018 primarily due to a 7.1% decrease in the average price per gallon of fuel including related taxes to $2.05 in 2019 from $2.21 in 2018.
|
•
|
Maintenance, materials and repairs increased 16.1% in 2019 as compared to 2018 primarily due to a contract change that resulted in certain flight equipment transitioning to a flight hour based contract (referred to as power by the hour) whereby expense is incurred and recognized based on actual hours flown. Previously, this flight equipment was covered by a time and materials based contract whereby expense is incurred and recognized as maintenance is performed. An increase in the volume of airframe and engine overhauls performed under time and material based contracts as well as an increase in the volume of component part repairs also drove higher maintenance expenses in 2019.
|
•
|
Other rent and landing fees increased 8.2% in 2019 as compared to 2018 primarily due to an expansion at DFW that became fully operational in May 2019 and rate increases at certain hub airports.
|
•
|
Depreciation and amortization increased 7.7% in 2019 as compared to 2018 due in part to airport and other facility improvements and the harmonization of interior configurations across the mainline fleet. Depreciation associated with aircraft acquired as part of American’s fleet renewal program also contributed to the increase.
|
•
|
Regional aircraft fuel and related taxes increased 1.4% in 2019 as compared to 2018 primarily due to an 8.3% increase in gallons of fuel consumed, offset in part by a 6.4% decrease in the average price per gallon of fuel including related taxes to $2.15 in 2019 from $2.30 in 2018.
|
•
|
Regional other operating expenses increased 8.2% in 2019 as compared to 2018 primarily driven by an increase in regional capacity.
|
|
Year Ended December 31,
|
||||||
2019
|
|
2018
|
|||||
|
(In millions)
|
||||||
Fleet restructuring expenses (1)
|
$
|
271
|
|
|
$
|
422
|
|
Fleet impairment (2)
|
213
|
|
|
—
|
|
||
Merger integration expenses (3)
|
191
|
|
|
268
|
|
||
Litigation reserve adjustments
|
(53
|
)
|
|
45
|
|
||
Mark-to-market adjustments on bankruptcy obligations, net (4)
|
(11
|
)
|
|
(76
|
)
|
||
Severance expenses (5)
|
11
|
|
|
58
|
|
||
Intangible asset impairment (6)
|
—
|
|
|
26
|
|
||
Labor contract expenses
|
—
|
|
|
13
|
|
||
Other operating charges, net
|
13
|
|
|
31
|
|
||
Total mainline operating special items, net
|
$
|
635
|
|
|
$
|
787
|
|
|
(1)
|
Fleet restructuring expenses principally included accelerated depreciation and rent expense for aircraft and related equipment grounded or expected to be grounded earlier than planned.
|
(2)
|
Fleet impairment principally includes a non-cash write-down of aircraft related to the planned retirement of American's Embraer E190 fleet.
|
(3)
|
Merger integration expenses included costs associated with integration projects, principally American's technical operations, flight attendant, human resources and payroll systems.
|
(4)
|
Bankruptcy obligations that will be settled in shares of AAG common stock are marked-to-market based on AAG’s stock price.
|
(5)
|
Severance expenses primarily included costs associated with reductions of management and support staff team members.
|
(6)
|
Intangible asset impairment includes a non-cash charge to write-off American’s Brazil route authority as a result of the U.S.-Brazil open skies agreement.
|
|
Year Ended
December 31,
|
|
Increase
(Decrease)
|
|
Percent
Increase
(Decrease)
|
|||||||||
|
2019
|
|
2018
|
|
||||||||||
|
(In millions, except percentage changes)
|
|||||||||||||
Interest income
|
$
|
515
|
|
|
$
|
330
|
|
|
$
|
185
|
|
|
56.1
|
|
Interest expense, net
|
(1,109
|
)
|
|
(1,028
|
)
|
|
(81
|
)
|
|
7.8
|
|
|||
Other income, net
|
152
|
|
|
167
|
|
|
(15
|
)
|
|
(9.3
|
)
|
|||
Total nonoperating expense, net
|
$
|
(442
|
)
|
|
$
|
(531
|
)
|
|
$
|
89
|
|
|
(16.9
|
)
|
|
AAG
|
|
American
|
||||||||||||
|
December 31,
|
|
December 31,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Cash
|
$
|
280
|
|
|
$
|
275
|
|
|
$
|
267
|
|
|
$
|
265
|
|
Short-term investments
|
3,546
|
|
|
4,485
|
|
|
3,543
|
|
|
4,482
|
|
||||
Undrawn revolving credit facilities (1)
|
3,243
|
|
|
2,843
|
|
|
3,243
|
|
|
2,843
|
|
||||
Total available liquidity
|
$
|
7,069
|
|
|
$
|
7,603
|
|
|
$
|
7,053
|
|
|
$
|
7,590
|
|
|
(1)
|
For 2019, this amount includes $400 million in borrowing capacity under a short-term revolving line of credit we arranged in December 2019 due to uncertainty surrounding the timing of the Boeing 737 MAX aircraft return to service. We have no present intention to borrow any amounts under this facility, which matures in September 2020 with an optional extension to December 2020. For additional discussion of this facility see Note 5 to AAG’s Consolidated Financial Statements in Part II, Item 8A and Note 3 to American’s Consolidated Financial Statements in Part II, Item 8B.
|
Period
|
|
Per share
|
|
For stockholders of record as of
|
|
Payable on
|
|
Total
(millions)
|
||||
First Quarter
|
|
$
|
0.10
|
|
|
February 6, 2019
|
|
February 20, 2019
|
|
$
|
46
|
|
Second Quarter
|
|
0.10
|
|
|
May 8, 2019
|
|
May 22, 2019
|
|
44
|
|
||
Third Quarter
|
|
0.10
|
|
|
August 7, 2019
|
|
August 21, 2019
|
|
44
|
|
||
Fourth Quarter
|
|
0.10
|
|
|
November 6, 2019
|
|
November 20, 2019
|
|
44
|
|
||
Total
|
|
$
|
0.40
|
|
|
|
|
|
|
$
|
178
|
|
|
Payments Due by Period
|
||||||||||||||||||||||||||
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
2024
|
|
2025 and Thereafter
|
|
Total
|
||||||||||||||
American (a)
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Long-term debt:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Principal amount (b), (d) (See Note 3)
|
$
|
2,293
|
|
|
$
|
3,508
|
|
|
$
|
1,551
|
|
|
$
|
4,072
|
|
|
$
|
1,521
|
|
|
$
|
9,632
|
|
|
$
|
22,577
|
|
Interest obligations (c), (d)
|
830
|
|
|
721
|
|
|
596
|
|
|
510
|
|
|
388
|
|
|
885
|
|
|
3,930
|
|
|||||||
Finance lease obligations (See Note 4)
|
153
|
|
|
128
|
|
|
132
|
|
|
110
|
|
|
116
|
|
|
171
|
|
|
810
|
|
|||||||
Aircraft and engine purchase commitments (e) (See Note 10(a))
|
1,629
|
|
|
750
|
|
|
1,599
|
|
|
1,543
|
|
|
2,574
|
|
|
4,855
|
|
|
12,950
|
|
|||||||
Operating lease commitments (See Note 4)
|
2,013
|
|
|
1,979
|
|
|
1,807
|
|
|
1,623
|
|
|
1,227
|
|
|
4,451
|
|
|
13,100
|
|
|||||||
Regional capacity purchase agreements (f) (See Note 10(b))
|
1,115
|
|
|
1,185
|
|
|
1,126
|
|
|
1,077
|
|
|
1,077
|
|
|
3,402
|
|
|
8,982
|
|
|||||||
Minimum pension obligations (g) (See Note 8)
|
193
|
|
|
493
|
|
|
607
|
|
|
618
|
|
|
654
|
|
|
413
|
|
|
2,978
|
|
|||||||
Retiree medical and other postretirement benefits (See Note 8)
|
24
|
|
|
18
|
|
|
18
|
|
|
17
|
|
|
29
|
|
|
265
|
|
|
371
|
|
|||||||
Other purchase obligations (h) (See Note 10(a))
|
3,546
|
|
|
3,508
|
|
|
1,328
|
|
|
130
|
|
|
81
|
|
|
77
|
|
|
8,670
|
|
|||||||
Total American Contractual Obligations
|
$
|
11,796
|
|
|
$
|
12,290
|
|
|
$
|
8,764
|
|
|
$
|
9,700
|
|
|
$
|
7,667
|
|
|
$
|
24,151
|
|
|
$
|
74,368
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
AAG Parent and Other AAG Subsidiaries (a)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Long-term debt:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Principal amount (b) (See Note 5)
|
$
|
505
|
|
|
$
|
2
|
|
|
$
|
752
|
|
|
$
|
2
|
|
|
$
|
2
|
|
|
$
|
16
|
|
|
$
|
1,279
|
|
Interest obligations (c)
|
51
|
|
|
39
|
|
|
21
|
|
|
1
|
|
|
1
|
|
|
3
|
|
|
116
|
|
|||||||
Operating lease commitments (See Note 6)
|
16
|
|
|
13
|
|
|
12
|
|
|
5
|
|
|
2
|
|
|
8
|
|
|
56
|
|
|||||||
Minimum pension obligations (g) (See Note 10)
|
3
|
|
|
4
|
|
|
4
|
|
|
4
|
|
|
5
|
|
|
13
|
|
|
33
|
|
|||||||
Total AAG Contractual Obligations
|
$
|
12,371
|
|
|
$
|
12,348
|
|
|
$
|
9,553
|
|
|
$
|
9,712
|
|
|
$
|
7,677
|
|
|
$
|
24,191
|
|
|
$
|
75,852
|
|
|
(a)
|
For additional information, see the Notes to AAG’s and American’s Consolidated Financial Statements in Part II, Items 8A and 8B, respectively, referenced in the table above.
|
(b)
|
Amounts represent contractual amounts due. Excludes $205 million and $6 million of unamortized debt discount, premium and issuance costs as of December 31, 2019 for American and AAG Parent, respectively.
|
(c)
|
For variable-rate debt, future interest obligations are estimated using the current forward rates at December 31, 2019.
|
(d)
|
Includes $11.9 billion of future principal payments and $2.3 billion of future interest payments as of December 31, 2019, related to EETCs associated with mortgage financings of certain aircraft and spare engines.
|
(e)
|
See Part I, Item 2. Properties – “Aircraft and Engine Purchase Commitments” for additional information about the firm commitment aircraft delivery schedule, in particular the footnotes to the table thereunder as to potential changes to such delivery schedule. Due to uncertainty surrounding the timing of delivery of certain aircraft, the amounts in the table represent our current best estimate, including with respect to the delivery of Boeing 737 MAX aircraft; however, the actual delivery schedule may differ from the table above, potentially materially. Additionally, the amounts in the table exclude 22 787-8 aircraft to be delivered in 2020 and 2021 for which Boeing has committed to provide sale-leaseback financing (in the form of operating leases). This financing is reflected in the operating lease commitments line above.
|
(f)
|
Represents minimum payments under capacity purchase agreements with third-party regional carriers. These commitments are estimates of costs based on assumed minimum levels of flying under the capacity purchase agreements and our actual payments could differ materially. Rental payments under operating leases for certain aircraft flown under these capacity purchase agreements are reflected in the operating lease commitments line above.
|
(g)
|
Includes minimum pension contributions based on actuarially determined estimates and is based on estimated payments through 2029.
|
(h)
|
Includes purchase commitments for aircraft fuel, construction projects and information technology support.
|
|
2019
|
|
2018
|
||
Pension weighted average discount rate (1)
|
3.4
|
%
|
|
4.4
|
%
|
Retiree medical and other postretirement benefits weighted average discount rate (1)
|
3.3
|
%
|
|
4.3
|
%
|
Expected rate of return on plan assets (2)
|
8.0
|
%
|
|
8.0
|
%
|
Weighted average health care cost trend rate assumed for next year (3):
|
|
|
|
||
Initial
|
3.7
|
%
|
|
3.9
|
%
|
Ultimate (2027)
|
3.3
|
%
|
|
3.5
|
%
|
|
(1)
|
When establishing our discount rate to measure our obligations, we match high quality corporate bonds available in the marketplace whose cash flows approximate our projected benefit disbursements. Lowering the discount rate by 50 basis points as of December 31, 2019 would increase our pension and retiree medical and other postretirement benefits obligations by approximately $1.3 billion and $40 million, respectively, decrease estimated 2020 pension expense by approximately $5 million and increase estimated 2020 retiree medical and other postretirement benefits expense by less than $1 million.
|
(2)
|
The expected rate of return on plan assets is based upon an evaluation of our historical trends and experience, taking into account current and expected market conditions and our target asset allocation of 26% U.S. stocks, 16% developed international stocks, 30% fixed income securities, 20% alternative (private) investments and 8% emerging market stocks. The expected rate of return on plan assets component of our net periodic benefit cost is calculated based on the fair value of plan assets and our target asset allocation. Lowering the expected long-term rate of return on plan assets by 50 basis points as of December 31, 2019 would increase estimated 2020 pension expense and retiree medical and other postretirement benefits expense by approximately $65 million and $1 million, respectively.
|
(3)
|
The assumed health care cost trend rate is based upon an evaluation of our historical trends and experience, taking into account current and expected market conditions. Increasing the assumed health care cost trend rate by 100 basis points would increase estimated 2020 retiree medical and other postretirement benefits expense by approximately $5 million.
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Operating revenues:
|
|
||||||||||
Passenger
|
$
|
42,010
|
|
|
$
|
40,676
|
|
|
$
|
39,131
|
|
Cargo
|
863
|
|
|
1,013
|
|
|
890
|
|
|||
Other
|
2,895
|
|
|
2,852
|
|
|
2,601
|
|
|||
Total operating revenues
|
45,768
|
|
|
44,541
|
|
|
42,622
|
|
|||
Operating expenses:
|
|
|
|
|
|
||||||
Aircraft fuel and related taxes
|
7,526
|
|
|
8,053
|
|
|
6,128
|
|
|||
Salaries, wages and benefits
|
12,609
|
|
|
12,251
|
|
|
11,954
|
|
|||
Regional expenses
|
7,501
|
|
|
7,133
|
|
|
6,546
|
|
|||
Maintenance, materials and repairs
|
2,380
|
|
|
2,050
|
|
|
1,959
|
|
|||
Other rent and landing fees
|
2,055
|
|
|
1,900
|
|
|
1,806
|
|
|||
Aircraft rent
|
1,326
|
|
|
1,264
|
|
|
1,197
|
|
|||
Selling expenses
|
1,602
|
|
|
1,520
|
|
|
1,477
|
|
|||
Depreciation and amortization
|
1,982
|
|
|
1,839
|
|
|
1,702
|
|
|||
Special items, net
|
635
|
|
|
787
|
|
|
712
|
|
|||
Other
|
5,087
|
|
|
5,088
|
|
|
4,910
|
|
|||
Total operating expenses
|
42,703
|
|
|
41,885
|
|
|
38,391
|
|
|||
Operating income
|
3,065
|
|
|
2,656
|
|
|
4,231
|
|
|||
Nonoperating income (expense):
|
|
|
|
|
|
||||||
Interest income
|
127
|
|
|
118
|
|
|
94
|
|
|||
Interest expense, net
|
(1,095
|
)
|
|
(1,056
|
)
|
|
(1,053
|
)
|
|||
Other income, net
|
159
|
|
|
166
|
|
|
123
|
|
|||
Total nonoperating expense, net
|
(809
|
)
|
|
(772
|
)
|
|
(836
|
)
|
|||
Income before income taxes
|
2,256
|
|
|
1,884
|
|
|
3,395
|
|
|||
Income tax provision
|
570
|
|
|
472
|
|
|
2,113
|
|
|||
Net income
|
$
|
1,686
|
|
|
$
|
1,412
|
|
|
$
|
1,282
|
|
|
|
|
|
|
|
||||||
Earnings per common share:
|
|
|
|
|
|
||||||
Basic
|
$
|
3.80
|
|
|
$
|
3.04
|
|
|
$
|
2.62
|
|
Diluted
|
$
|
3.79
|
|
|
$
|
3.03
|
|
|
$
|
2.61
|
|
Weighted average shares outstanding (in thousands):
|
|
|
|
|
|
||||||
Basic
|
443,363
|
|
|
464,236
|
|
|
489,164
|
|
|||
Diluted
|
444,269
|
|
|
465,660
|
|
|
491,692
|
|
|||
Cash dividends declared per common share
|
$
|
0.40
|
|
|
$
|
0.40
|
|
|
$
|
0.40
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Net income
|
$
|
1,686
|
|
|
$
|
1,412
|
|
|
$
|
1,282
|
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
||||||
Pension, retiree medical and other postretirement benefits
|
(438
|
)
|
|
(117
|
)
|
|
(70
|
)
|
|||
Investments
|
3
|
|
|
(3
|
)
|
|
(1
|
)
|
|||
Total other comprehensive loss, net of tax
|
(435
|
)
|
|
(120
|
)
|
|
(71
|
)
|
|||
Total comprehensive income
|
$
|
1,251
|
|
|
$
|
1,292
|
|
|
$
|
1,211
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
ASSETS
|
|
||||||
Current assets
|
|
|
|
||||
Cash
|
$
|
280
|
|
|
$
|
275
|
|
Short-term investments
|
3,546
|
|
|
4,485
|
|
||
Restricted cash and short-term investments
|
158
|
|
|
154
|
|
||
Accounts receivable, net
|
1,750
|
|
|
1,706
|
|
||
Aircraft fuel, spare parts and supplies, net
|
1,851
|
|
|
1,522
|
|
||
Prepaid expenses and other
|
621
|
|
|
495
|
|
||
Total current assets
|
8,206
|
|
|
8,637
|
|
||
Operating property and equipment
|
|
|
|
||||
Flight equipment
|
42,537
|
|
|
41,499
|
|
||
Ground property and equipment
|
9,443
|
|
|
8,764
|
|
||
Equipment purchase deposits
|
1,674
|
|
|
1,278
|
|
||
Total property and equipment, at cost
|
53,654
|
|
|
51,541
|
|
||
Less accumulated depreciation and amortization
|
(18,659
|
)
|
|
(17,443
|
)
|
||
Total property and equipment, net
|
34,995
|
|
|
34,098
|
|
||
Operating lease right-of-use assets
|
8,737
|
|
|
9,151
|
|
||
Other assets
|
|
|
|
||||
Goodwill
|
4,091
|
|
|
4,091
|
|
||
Intangibles, net of accumulated amortization of $704 and $663, respectively
|
2,084
|
|
|
2,137
|
|
||
Deferred tax asset
|
645
|
|
|
1,145
|
|
||
Other assets
|
1,237
|
|
|
1,321
|
|
||
Total other assets
|
8,057
|
|
|
8,694
|
|
||
Total assets
|
$
|
59,995
|
|
|
$
|
60,580
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
|
|
|
|
||||
Current liabilities
|
|
|
|
||||
Current maturities of long-term debt and finance leases
|
$
|
2,861
|
|
|
$
|
3,294
|
|
Accounts payable
|
2,062
|
|
|
1,773
|
|
||
Accrued salaries and wages
|
1,541
|
|
|
1,427
|
|
||
Air traffic liability
|
4,808
|
|
|
4,339
|
|
||
Loyalty program liability
|
3,193
|
|
|
3,267
|
|
||
Operating lease liabilities
|
1,708
|
|
|
1,654
|
|
||
Other accrued liabilities
|
2,138
|
|
|
2,342
|
|
||
Total current liabilities
|
18,311
|
|
|
18,096
|
|
||
Noncurrent liabilities
|
|
|
|
||||
Long-term debt and finance leases, net of current maturities
|
21,454
|
|
|
21,179
|
|
||
Pension and postretirement benefits
|
6,052
|
|
|
6,907
|
|
||
Loyalty program liability
|
5,422
|
|
|
5,272
|
|
||
Operating lease liabilities
|
7,421
|
|
|
7,902
|
|
||
Other liabilities
|
1,453
|
|
|
1,393
|
|
||
Total noncurrent liabilities
|
41,802
|
|
|
42,653
|
|
||
Commitments and contingencies (Note 12)
|
|
|
|
||||
Stockholders' equity (deficit)
|
|
|
|
||||
Common stock, $0.01 par value; 1,750,000,000 shares authorized, 428,202,506 shares issued and outstanding at December 31, 2019; 460,610,870 shares issued and outstanding at December 31, 2018
|
4
|
|
|
5
|
|
||
Additional paid-in capital
|
3,945
|
|
|
4,964
|
|
||
Accumulated other comprehensive loss
|
(6,331
|
)
|
|
(5,896
|
)
|
||
Retained earnings
|
2,264
|
|
|
758
|
|
||
Total stockholders' deficit
|
(118
|
)
|
|
(169
|
)
|
||
Total liabilities and stockholders’ equity (deficit)
|
$
|
59,995
|
|
|
$
|
60,580
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
||||||
Net income
|
$
|
1,686
|
|
|
$
|
1,412
|
|
|
$
|
1,282
|
|
Adjustments to reconcile net income to net cash provided by operating activities
|
|
|
|
|
|
||||||
Depreciation and amortization
|
2,318
|
|
|
2,159
|
|
|
2,017
|
|
|||
Net gains from sale of property and equipment and sale-leaseback transactions
|
(112
|
)
|
|
(59
|
)
|
|
(11
|
)
|
|||
Special items, net non-cash
|
376
|
|
|
458
|
|
|
272
|
|
|||
Pension and postretirement
|
(178
|
)
|
|
(300
|
)
|
|
(132
|
)
|
|||
Deferred income tax provision
|
560
|
|
|
440
|
|
|
2,089
|
|
|||
Share-based compensation
|
94
|
|
|
86
|
|
|
90
|
|
|||
Other, net
|
(62
|
)
|
|
(97
|
)
|
|
(142
|
)
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||||
Decrease (increase) in accounts receivable
|
73
|
|
|
222
|
|
|
(190
|
)
|
|||
Increase in other assets
|
(373
|
)
|
|
(390
|
)
|
|
(433
|
)
|
|||
Increase (decrease) in accounts payable and accrued liabilities
|
327
|
|
|
(147
|
)
|
|
299
|
|
|||
Increase in air traffic liability
|
469
|
|
|
297
|
|
|
65
|
|
|||
Increase (decrease) in loyalty program liability
|
76
|
|
|
(283
|
)
|
|
(308
|
)
|
|||
Contributions to pension plans
|
(1,230
|
)
|
|
(475
|
)
|
|
(286
|
)
|
|||
Increase (decrease) in other liabilities
|
(209
|
)
|
|
210
|
|
|
132
|
|
|||
Net cash provided by operating activities
|
3,815
|
|
|
3,533
|
|
|
4,744
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
||||||
Capital expenditures and aircraft purchase deposits
|
(4,268
|
)
|
|
(3,745
|
)
|
|
(5,971
|
)
|
|||
Proceeds from sale-leaseback transactions
|
850
|
|
|
1,096
|
|
|
853
|
|
|||
Proceeds from sale of property and equipment
|
54
|
|
|
111
|
|
|
94
|
|
|||
Purchases of short-term investments
|
(3,184
|
)
|
|
(3,412
|
)
|
|
(4,633
|
)
|
|||
Sales of short-term investments
|
4,144
|
|
|
3,705
|
|
|
5,915
|
|
|||
Proceeds from vendor
|
250
|
|
|
—
|
|
|
—
|
|
|||
Decrease (increase) in restricted short-term investments
|
(3
|
)
|
|
72
|
|
|
309
|
|
|||
Proceeds from sale of investments
|
—
|
|
|
207
|
|
|
—
|
|
|||
Purchase of equity investment
|
—
|
|
|
—
|
|
|
(203
|
)
|
|||
Other investing activities
|
(86
|
)
|
|
(7
|
)
|
|
—
|
|
|||
Net cash used in investing activities
|
(2,243
|
)
|
|
(1,973
|
)
|
|
(3,636
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
||||||
Proceeds from issuance of long-term debt
|
3,960
|
|
|
2,354
|
|
|
3,058
|
|
|||
Payments on long-term debt and finance leases
|
(4,190
|
)
|
|
(2,941
|
)
|
|
(2,332
|
)
|
|||
Deferred financing costs
|
(61
|
)
|
|
(59
|
)
|
|
(85
|
)
|
|||
Treasury stock repurchases
|
(1,097
|
)
|
|
(837
|
)
|
|
(1,615
|
)
|
|||
Dividend payments
|
(178
|
)
|
|
(186
|
)
|
|
(198
|
)
|
|||
Other financing activities
|
(2
|
)
|
|
(3
|
)
|
|
27
|
|
|||
Net cash used in financing activities
|
(1,568
|
)
|
|
(1,672
|
)
|
|
(1,145
|
)
|
|||
Net increase (decrease) in cash and restricted cash
|
4
|
|
|
(112
|
)
|
|
(37
|
)
|
|||
Cash and restricted cash at beginning of year
|
286
|
|
|
398
|
|
|
435
|
|
|||
Cash and restricted cash at end of year (a)
|
$
|
290
|
|
|
$
|
286
|
|
|
$
|
398
|
|
|
Cash
|
$
|
280
|
|
|
$
|
275
|
|
|
$
|
295
|
|
Restricted cash included in restricted cash and short-term investments
|
10
|
|
|
11
|
|
|
103
|
|
|||
Total cash and restricted cash
|
$
|
290
|
|
|
$
|
286
|
|
|
$
|
398
|
|
|
Common
Stock
|
|
Additional
Paid-in
Capital
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Retained
Earnings
(Deficit)
|
|
Total
|
||||||||||
Balance at December 31, 2016
|
$
|
5
|
|
|
$
|
7,223
|
|
|
$
|
(5,083
|
)
|
|
$
|
(2,429
|
)
|
|
$
|
(284
|
)
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
1,282
|
|
|
1,282
|
|
|||||
Other comprehensive loss, net
|
—
|
|
|
—
|
|
|
(71
|
)
|
|
—
|
|
|
(71
|
)
|
|||||
Issuance of 2,166,861 shares of AAG common stock pursuant to
employee stock plans net of shares withheld for cash taxes
|
—
|
|
|
(51
|
)
|
|
—
|
|
|
—
|
|
|
(51
|
)
|
|||||
Purchase and retirement of 33,953,127 shares of AAG common stock
|
—
|
|
|
(1,563
|
)
|
|
—
|
|
|
—
|
|
|
(1,563
|
)
|
|||||
Dividends declared on AAG common stock ($0.40 per share)
|
—
|
|
|
—
|
|
|
—
|
|
|
(198
|
)
|
|
(198
|
)
|
|||||
Settlement of single-dip unsecured claims held in Disputed Claims
Reserve
|
—
|
|
|
15
|
|
|
—
|
|
|
—
|
|
|
15
|
|
|||||
Share-based compensation expense
|
—
|
|
|
90
|
|
|
—
|
|
|
—
|
|
|
90
|
|
|||||
Impact of adoption of Accounting Standards Update (ASU) 2018-02
related to comprehensive income (See Note 1(b))
|
—
|
|
|
—
|
|
|
(622
|
)
|
|
622
|
|
|
—
|
|
|||||
Balance at December 31, 2017
|
5
|
|
|
5,714
|
|
|
(5,776
|
)
|
|
(723
|
)
|
|
(780
|
)
|
|||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
1,412
|
|
|
1,412
|
|
|||||
Other comprehensive loss, net
|
—
|
|
|
—
|
|
|
(120
|
)
|
|
—
|
|
|
(120
|
)
|
|||||
Issuance of 1,709,140 shares of AAG common stock pursuant to
employee stock plans net of shares withheld for cash taxes
|
—
|
|
|
(37
|
)
|
|
—
|
|
|
—
|
|
|
(37
|
)
|
|||||
Purchase and retirement of 16,606,157 shares of AAG common stock
|
—
|
|
|
(799
|
)
|
|
—
|
|
|
—
|
|
|
(799
|
)
|
|||||
Dividends declared on AAG common stock ($0.40 per share)
|
—
|
|
|
—
|
|
|
—
|
|
|
(188
|
)
|
|
(188
|
)
|
|||||
Share-based compensation expense
|
—
|
|
|
86
|
|
|
—
|
|
|
—
|
|
|
86
|
|
|||||
Impact of adoption of ASU 2016-01 related to financial instruments
|
—
|
|
|
—
|
|
|
—
|
|
|
60
|
|
|
60
|
|
|||||
Impact of adoption of ASU 2016-02 related to leases
|
—
|
|
|
—
|
|
|
—
|
|
|
197
|
|
|
197
|
|
|||||
Balance at December 31, 2018
|
5
|
|
|
4,964
|
|
|
(5,896
|
)
|
|
758
|
|
|
(169
|
)
|
|||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
1,686
|
|
|
1,686
|
|
|||||
Other comprehensive loss, net
|
—
|
|
|
—
|
|
|
(435
|
)
|
|
—
|
|
|
(435
|
)
|
|||||
Issuance of 1,682,202 shares of AAG common stock pursuant to
employee stock plans net of shares withheld for cash taxes
|
—
|
|
|
(25
|
)
|
|
—
|
|
|
—
|
|
|
(25
|
)
|
|||||
Purchase and retirement of 34,090,566 shares of AAG common stock
|
(1
|
)
|
|
(1,095
|
)
|
|
—
|
|
|
—
|
|
|
(1,096
|
)
|
|||||
Dividends declared on AAG common stock ($0.40 per share)
|
—
|
|
|
—
|
|
|
—
|
|
|
(180
|
)
|
|
(180
|
)
|
|||||
Settlement of single-dip unsecured claims held in Disputed Claims Reserve
|
—
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|||||
Share-based compensation expense
|
—
|
|
|
94
|
|
|
—
|
|
|
—
|
|
|
94
|
|
|||||
Balance at December 31, 2019
|
$
|
4
|
|
|
$
|
3,945
|
|
|
$
|
(6,331
|
)
|
|
$
|
2,264
|
|
|
$
|
(118
|
)
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Domestic airport slots
|
$
|
365
|
|
|
$
|
365
|
|
Customer relationships
|
300
|
|
|
300
|
|
||
Marketing agreements
|
105
|
|
|
105
|
|
||
Tradenames
|
35
|
|
|
35
|
|
||
Airport gate leasehold rights
|
137
|
|
|
137
|
|
||
Accumulated amortization
|
(704
|
)
|
|
(663
|
)
|
||
Total
|
$
|
238
|
|
|
$
|
279
|
|
2020
|
$
|
41
|
|
2021
|
41
|
|
|
2022
|
41
|
|
|
2023
|
7
|
|
|
2024
|
7
|
|
|
2025 and thereafter
|
101
|
|
|
Total
|
$
|
238
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Passenger revenue:
|
|
|
|
|
|
||||||
Passenger travel
|
$
|
38,831
|
|
|
$
|
37,457
|
|
|
$
|
36,152
|
|
Loyalty revenue - travel (1)
|
3,179
|
|
|
3,219
|
|
|
2,979
|
|
|||
Total passenger revenue
|
42,010
|
|
|
40,676
|
|
|
39,131
|
|
|||
Cargo
|
863
|
|
|
1,013
|
|
|
890
|
|
|||
Other:
|
|
|
|
|
|
||||||
Loyalty revenue - marketing services
|
2,361
|
|
|
2,352
|
|
|
2,124
|
|
|||
Other revenue
|
534
|
|
|
500
|
|
|
477
|
|
|||
Total other revenue
|
2,895
|
|
|
2,852
|
|
|
2,601
|
|
|||
Total operating revenues
|
$
|
45,768
|
|
|
$
|
44,541
|
|
|
$
|
42,622
|
|
|
(1)
|
Loyalty revenue included in passenger revenue is principally comprised of mileage credit redemptions earned through travel or from co-branded credit card and other partners. See “Loyalty Revenue” below for further discussion on these mileage credits.
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Domestic
|
$
|
30,881
|
|
|
$
|
29,573
|
|
|
$
|
28,749
|
|
Latin America
|
5,047
|
|
|
5,125
|
|
|
4,840
|
|
|||
Atlantic
|
4,624
|
|
|
4,376
|
|
|
4,028
|
|
|||
Pacific
|
1,458
|
|
|
1,602
|
|
|
1,514
|
|
|||
Total passenger revenue
|
$
|
42,010
|
|
|
$
|
40,676
|
|
|
$
|
39,131
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Loyalty program liability
|
$
|
8,615
|
|
|
$
|
8,539
|
|
Air traffic liability
|
4,808
|
|
|
4,339
|
|
||
Total
|
$
|
13,423
|
|
|
$
|
12,878
|
|
Balance at December 31, 2018
|
$
|
8,539
|
|
Deferral of revenue
|
3,438
|
|
|
Recognition of revenue (1)
|
(3,362
|
)
|
|
Balance at December 31, 2019 (2)
|
$
|
8,615
|
|
|
(1)
|
Principally relates to revenue recognized from the redemption of mileage credits for both air and non-air travel awards. Mileage credits are combined in one homogenous pool and are not separately identifiable. As such, the revenue is comprised of miles that were part of the loyalty program deferred revenue balance at the beginning of the period, as well as miles that were issued during the period.
|
(2)
|
Mileage credits can be redeemed at any time and do not expire as long as that AAdvantage member has any type of qualifying activity at least every 18 months. As of December 31, 2019, our current loyalty program liability was $3.2 billion and represents our current estimate of revenue expected to be recognized in the next 12 months based on historical trends, with the balance reflected in long-term loyalty program liability expected to be recognized as revenue in periods thereafter.
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Aircraft fuel and related taxes
|
$
|
1,869
|
|
|
$
|
1,843
|
|
|
$
|
1,382
|
|
Salaries, wages and benefits
|
1,781
|
|
|
1,591
|
|
|
1,452
|
|
|||
Capacity purchases from third-party regional carriers (1)
|
1,398
|
|
|
1,431
|
|
|
1,581
|
|
|||
Maintenance, materials and repairs
|
403
|
|
|
340
|
|
|
281
|
|
|||
Other rent and landing fees
|
651
|
|
|
610
|
|
|
625
|
|
|||
Aircraft rent
|
29
|
|
|
32
|
|
|
35
|
|
|||
Selling expenses
|
402
|
|
|
369
|
|
|
361
|
|
|||
Depreciation and amortization
|
336
|
|
|
318
|
|
|
315
|
|
|||
Special items, net
|
6
|
|
|
6
|
|
|
22
|
|
|||
Other
|
626
|
|
|
593
|
|
|
492
|
|
|||
Total regional expenses
|
$
|
7,501
|
|
|
$
|
7,133
|
|
|
$
|
6,546
|
|
|
(1)
|
In 2019, 2018, and 2017, we recognized $590 million, $565 million and $544 million, respectively, of expense under our capacity purchase agreement with Republic Airline Inc. (Republic). We hold a 25% equity interest in Republic Airways Holdings Inc. (Republic Holdings), the parent company of Republic.
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Fleet restructuring expenses (1)
|
$
|
271
|
|
|
$
|
422
|
|
|
$
|
232
|
|
Fleet impairment (2)
|
213
|
|
|
—
|
|
|
—
|
|
|||
Merger integration expenses (3)
|
191
|
|
|
268
|
|
|
273
|
|
|||
Litigation reserve adjustments
|
(53
|
)
|
|
45
|
|
|
—
|
|
|||
Mark-to-market adjustments on bankruptcy obligations, net (4)
|
(11
|
)
|
|
(76
|
)
|
|
27
|
|
|||
Severance expenses (5)
|
11
|
|
|
58
|
|
|
—
|
|
|||
Intangible asset impairment (6)
|
—
|
|
|
26
|
|
|
—
|
|
|||
Labor contract expenses
|
—
|
|
|
13
|
|
|
46
|
|
|||
Employee 2017 Tax Act bonus expense (7)
|
—
|
|
|
—
|
|
|
123
|
|
|||
Other operating charges, net
|
13
|
|
|
31
|
|
|
11
|
|
|||
Mainline operating special items, net
|
635
|
|
|
787
|
|
|
712
|
|
|||
Regional operating special items, net
|
6
|
|
|
6
|
|
|
22
|
|
|||
Operating special items, net
|
641
|
|
|
793
|
|
|
734
|
|
|||
|
|
|
|
|
|
||||||
Debt refinancing and extinguishment charges
|
16
|
|
|
13
|
|
|
22
|
|
|||
Mark-to-market adjustments on equity and other investments, net (8)
|
(5
|
)
|
|
104
|
|
|
—
|
|
|||
Other nonoperating income, net
|
(8
|
)
|
|
(4
|
)
|
|
—
|
|
|||
Nonoperating special items, net
|
3
|
|
|
113
|
|
|
22
|
|
|||
|
|
|
|
|
|
||||||
Income tax special items (9)
|
—
|
|
|
18
|
|
|
—
|
|
|||
Impact of the 2017 Tax Act (10)
|
—
|
|
|
—
|
|
|
823
|
|
|||
Income tax special items, net
|
—
|
|
|
18
|
|
|
823
|
|
|
(1)
|
Fleet restructuring expenses principally included accelerated depreciation and rent expense for aircraft and related equipment grounded or expected to be grounded earlier than planned.
|
(2)
|
Fleet impairment principally includes a non-cash write-down of aircraft related to the planned retirement of our Embraer E190 fleet.
|
(3)
|
Merger integration expenses included costs associated with integration projects, principally our technical operations, flight attendant, human resources and payroll systems.
|
(4)
|
Bankruptcy obligations that will be settled in shares of our common stock are marked-to-market based on our stock price.
|
(5)
|
Severance expenses primarily included costs associated with reductions of management and support staff team members.
|
(6)
|
Intangible asset impairment includes a non-cash charge to write-off our Brazil route authority as a result of the U.S.-Brazil open skies agreement.
|
(7)
|
Employee bonus expense included costs related to the $1,000 cash bonus and associated payroll taxes granted to mainline employees in recognition of the 2017 Tax Act.
|
(8)
|
Mark-to-market adjustments on equity and other investments, net primarily relates to net unrealized gains and losses associated with our equity investment in China Southern Airlines Company Limited (China Southern Airlines).
|
(9)
|
Income tax special items for 2018 included an $18 million charge related to an international income tax matter.
|
(10)
|
Impact of the 2017 Tax Act includes an $823 million non-cash charge to income tax expense to reflect the impact of lower corporate income tax rates on our deferred tax asset and liabilities resulting from the 2017 Tax Act, which reduced the federal corporate income tax rate from 35% to 21%.
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Basic EPS:
|
|
|
|
|
|
||||||
Net income
|
$
|
1,686
|
|
|
$
|
1,412
|
|
|
$
|
1,282
|
|
Weighted average common shares outstanding (in thousands)
|
443,363
|
|
|
464,236
|
|
|
489,164
|
|
|||
Basic EPS
|
$
|
3.80
|
|
|
$
|
3.04
|
|
|
$
|
2.62
|
|
|
|
|
|
|
|
||||||
Diluted EPS:
|
|
|
|
|
|
||||||
Net income for purposes of computing diluted EPS
|
$
|
1,686
|
|
|
$
|
1,412
|
|
|
$
|
1,282
|
|
Share computation for diluted EPS (in thousands):
|
|
|
|
|
|
||||||
Basic weighted average common shares outstanding
|
443,363
|
|
|
464,236
|
|
|
489,164
|
|
|||
Dilutive effect of stock awards
|
906
|
|
|
1,424
|
|
|
2,528
|
|
|||
Diluted weighted average common shares outstanding
|
444,269
|
|
|
465,660
|
|
|
491,692
|
|
|||
Diluted EPS
|
$
|
3.79
|
|
|
$
|
3.03
|
|
|
$
|
2.61
|
|
|
|
|
|
|
|
||||||
Restricted stock unit awards excluded from the calculation of diluted EPS because inclusion would be antidilutive (in thousands)
|
2,520
|
|
|
1,266
|
|
|
328
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Secured
|
|
|
|
||||
2013 Credit Facilities, variable interest rate of 3.54%, installments through 2025 (a)
|
$
|
1,807
|
|
|
$
|
1,825
|
|
2014 Credit Facilities, variable interest rate of 3.72%, installments through 2021 (a)
|
1,202
|
|
|
1,215
|
|
||
April 2016 Credit Facilities, variable interest rate of 3.80%, installments through 2023 (a)
|
970
|
|
|
980
|
|
||
December 2016 Credit Facilities, variable interest rate of 3.74%, installments through 2023 (a)
|
1,213
|
|
|
1,225
|
|
||
Enhanced equipment trust certificates (EETCs), fixed interest rates ranging from 3.00% to 8.39%, averaging 4.05%, maturing from 2020 to 2032 (b)
|
11,933
|
|
|
11,648
|
|
||
Equipment loans and other notes payable, fixed and variable interest rates ranging from 2.99% to 7.31%, averaging 3.45%, maturing from 2020 to 2031 (c)
|
4,727
|
|
|
5,060
|
|
||
Special facility revenue bonds, fixed interest rates ranging from 5.00% to 8.00%, maturing from 2020 to 2031
|
754
|
|
|
798
|
|
||
|
22,606
|
|
|
22,751
|
|
||
Unsecured
|
|
|
|
||||
4.625% senior notes, interest only payments until due in March 2020 (d)
|
500
|
|
|
500
|
|
||
5.000% senior notes, interest only payments until due in June 2022 (d)
|
750
|
|
|
—
|
|
||
5.50% senior notes
|
—
|
|
|
750
|
|
||
|
1,250
|
|
|
1,250
|
|
||
Total long-term debt
|
23,856
|
|
|
24,001
|
|
||
Less: Total unamortized debt discount, premium and issuance costs
|
211
|
|
|
222
|
|
||
Less: Current maturities
|
2,749
|
|
|
3,213
|
|
||
Long-term debt, net of current maturities
|
$
|
20,896
|
|
|
$
|
20,566
|
|
2013 Revolving Facility
|
$
|
750
|
|
2014 Revolving Facility
|
1,643
|
|
|
April 2016 Revolving Facility
|
450
|
|
|
Other Short-term Revolving Facility
|
400
|
|
|
Total
|
$
|
3,243
|
|
2020
|
$
|
2,798
|
|
2021
|
3,510
|
|
|
2022
|
2,303
|
|
|
2023
|
4,074
|
|
|
2024
|
1,523
|
|
|
2025 and thereafter
|
9,648
|
|
|
Total
|
$
|
23,856
|
|
|
2013 Credit Facilities
|
|
2014 Credit Facilities
|
|
April 2016 Credit Facilities
|
|
December 2016 Credit Facilities
|
||||||
|
2013 Replacement Term Loan
|
|
2013
Revolving Facility |
|
2014 Term Loan
|
|
2014
Revolving Facility |
|
April 2016 Term Loan
|
|
April 2016
Revolving Facility |
|
December 2016 Term Loan
|
Aggregate principal issued
or credit facility availability
(in millions)
|
$1,919
|
|
$750
|
|
$1,250
|
|
$1,643
|
|
$1,000
|
|
$450
|
|
$1,250
|
Principal outstanding or
drawn (in millions)
|
$1,807
|
|
$—
|
|
$1,202
|
|
$—
|
|
$970
|
|
$—
|
|
$1,213
|
Maturity date
|
June 2025
|
|
October 2024
|
|
October 2021
|
|
October 2024
|
|
April 2023
|
|
October 2024
|
|
December 2023
|
LIBOR margin
|
1.75%
|
|
2.00%
|
|
2.00%
|
|
2.00%
|
|
2.00%
|
|
2.00%
|
|
2.00%
|
|
2019-1 Aircraft EETCs
|
||||
|
Series AA
|
|
Series A
|
|
Series B
|
Aggregate principal issued
|
$579 million
|
|
$289 million
|
|
$229 million
|
Remaining escrowed proceeds
|
$155 million
|
|
$77 million
|
|
$61 million
|
Fixed interest rate per annum
|
3.15%
|
|
3.50%
|
|
3.85%
|
Maturity date
|
February 2032
|
|
February 2032
|
|
February 2028
|
|
4.625% Senior Notes
|
|
5.000% Senior Notes
|
Aggregate principal issued and outstanding
|
$500 million
|
|
$750 million
|
Maturity date
|
March 2020
|
|
June 2022
|
Fixed interest rate per annum
|
4.625%
|
|
5.000%
|
Interest payments
|
Semi-annually in arrears in March and September
|
|
Semi-annually in arrears in June and December
|
|
2013 Credit Facilities
|
|
2014 Credit Facilities
|
|
April 2016
Credit Facilities
|
|
December 2016
Credit Facilities
|
Frequency of Appraisals of
Appraised Collateral
|
Annual
|
|
Annual
|
|
Annual
|
|
Annual
|
LTV Requirement
|
1.6x Collateral valuation to amount of debt outstanding (62.5% LTV)
|
|
1.6x Collateral valuation to amount of debt outstanding (62.5% LTV)
|
|
1.6x Collateral valuation to amount of debt outstanding (62.5% LTV)
|
|
1.6x Collateral valuation to amount of debt outstanding (62.5% LTV)
|
LTV as of Last Measurement
Date
|
36.2%
|
|
17.7%
|
|
36.2%
|
|
53.6%
|
Collateral Description
|
Generally, certain slots, route authorities and airport gate leasehold rights used by American to operate all services between the U.S. and South America
|
|
Generally, certain slots, route authorities and airport gate leasehold rights used by American to operate certain services between the U.S. and European Union (including London Heathrow)
|
|
Generally, certain spare parts
|
|
Generally, certain Ronald Reagan Washington National Airport (DCA) slots, certain La Guardia Airport (LGA) slots, certain simulators and certain leasehold rights
|
|
Year Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
Operating lease cost
|
$
|
2,027
|
|
|
$
|
1,907
|
|
Finance lease cost:
|
|
|
|
||||
Amortization of assets
|
79
|
|
|
78
|
|
||
Interest on lease liabilities
|
43
|
|
|
48
|
|
||
Variable lease cost
|
2,558
|
|
|
2,353
|
|
||
Total net lease cost
|
$
|
4,707
|
|
|
$
|
4,386
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Operating leases:
|
|
|
|
||||
Operating lease ROU assets
|
$
|
8,737
|
|
|
$
|
9,151
|
|
|
|
|
|
||||
Current operating lease liabilities
|
$
|
1,708
|
|
|
$
|
1,654
|
|
Noncurrent operating lease liabilities
|
7,421
|
|
|
7,902
|
|
||
Total operating lease liabilities
|
$
|
9,129
|
|
|
$
|
9,556
|
|
|
|
|
|
||||
Finance leases:
|
|
|
|
||||
Property and equipment, at cost
|
$
|
954
|
|
|
$
|
936
|
|
Accumulated amortization
|
(447
|
)
|
|
(391
|
)
|
||
Property and equipment, net
|
$
|
507
|
|
|
$
|
545
|
|
|
|
|
|
||||
Current finance lease liabilities
|
$
|
112
|
|
|
$
|
81
|
|
Noncurrent finance lease liabilities
|
558
|
|
|
613
|
|
||
Total finance lease liabilities
|
$
|
670
|
|
|
$
|
694
|
|
|
|
|
|
||||
Weighted average remaining lease term (in years):
|
|
|
|
||||
Operating leases
|
7.4
|
|
|
7.6
|
|
||
Finance leases
|
6.2
|
|
|
7.4
|
|
||
|
|
|
|
||||
Weighted average discount rate:
|
|
|
|
||||
Operating leases
|
4.7
|
%
|
|
4.6
|
%
|
||
Finance leases
|
6.2
|
%
|
|
6.5
|
%
|
|
Year Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
Cash paid for amounts included in the measurement of lease liabilities:
|
|
|
|
||||
Operating cash flows from operating leases
|
$
|
2,013
|
|
|
$
|
1,931
|
|
Operating cash flows from finance leases
|
43
|
|
|
48
|
|
||
Financing cash flows from finance leases
|
83
|
|
|
78
|
|
||
|
|
|
|
||||
Non-cash transactions:
|
|
|
|
||||
ROU assets acquired through operating leases
|
1,145
|
|
|
1,292
|
|
||
Operating lease conversion to finance lease
|
41
|
|
|
—
|
|
||
Property and equipment acquired through finance leases
|
20
|
|
|
—
|
|
||
|
|
|
|
||||
Gain on sale leaseback transactions, net
|
107
|
|
|
59
|
|
|
December 31, 2019
|
||||||
|
Operating Leases
|
|
Finance Leases
|
||||
2020
|
$
|
1,990
|
|
|
$
|
153
|
|
2021
|
1,817
|
|
|
128
|
|
||
2022
|
1,620
|
|
|
132
|
|
||
2023
|
1,429
|
|
|
110
|
|
||
2024
|
1,030
|
|
|
116
|
|
||
2025 and thereafter
|
3,276
|
|
|
171
|
|
||
Total lease payments
|
11,162
|
|
|
810
|
|
||
Less: Imputed interest
|
(2,033
|
)
|
|
(140
|
)
|
||
Total lease obligations
|
9,129
|
|
|
670
|
|
||
Less: Current obligations
|
(1,708
|
)
|
|
(112
|
)
|
||
Long-term lease obligations
|
$
|
7,421
|
|
|
$
|
558
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Current income tax provision:
|
|
|
|
|
|
||||||
State and Local
|
$
|
2
|
|
|
$
|
3
|
|
|
$
|
10
|
|
Foreign
|
8
|
|
|
29
|
|
|
14
|
|
|||
Current income tax provision
|
10
|
|
|
32
|
|
|
24
|
|
|||
Deferred income tax provision:
|
|
|
|
|
|
||||||
Federal
|
498
|
|
|
390
|
|
|
2,026
|
|
|||
State and Local
|
62
|
|
|
50
|
|
|
63
|
|
|||
Deferred income tax provision
|
560
|
|
|
440
|
|
|
2,089
|
|
|||
Total income tax provision
|
$
|
570
|
|
|
$
|
472
|
|
|
$
|
2,113
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Statutory income tax provision
|
$
|
474
|
|
|
$
|
396
|
|
|
$
|
1,188
|
|
State income tax provision, net of federal tax effect
|
47
|
|
|
44
|
|
|
59
|
|
|||
Book expenses not deductible for tax purposes
|
31
|
|
|
12
|
|
|
33
|
|
|||
Foreign income taxes, net of federal tax effect
|
8
|
|
|
23
|
|
|
7
|
|
|||
Change in valuation allowance
|
4
|
|
|
(6
|
)
|
|
(3
|
)
|
|||
2017 Tax Act
|
—
|
|
|
—
|
|
|
823
|
|
|||
Other, net
|
6
|
|
|
3
|
|
|
6
|
|
|||
Income tax provision
|
$
|
570
|
|
|
$
|
472
|
|
|
$
|
2,113
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Deferred tax assets:
|
|
|
|
||||
Operating loss carryforwards
|
$
|
2,103
|
|
|
$
|
2,343
|
|
Leases
|
2,077
|
|
|
2,189
|
|
||
Loyalty program liability
|
1,755
|
|
|
1,770
|
|
||
Pensions
|
1,229
|
|
|
1,430
|
|
||
Postretirement benefits other than pensions
|
145
|
|
|
145
|
|
||
Rent expense
|
126
|
|
|
136
|
|
||
Alternative minimum tax (AMT) credit carryforwards
|
90
|
|
|
175
|
|
||
Reorganization items
|
30
|
|
|
33
|
|
||
Other
|
613
|
|
|
631
|
|
||
Total deferred tax assets
|
8,168
|
|
|
8,852
|
|
||
Valuation allowance
|
(34
|
)
|
|
(30
|
)
|
||
Net deferred tax assets
|
8,134
|
|
|
8,822
|
|
||
Deferred tax liabilities:
|
|
|
|
||||
Accelerated depreciation and amortization
|
(5,196
|
)
|
|
(5,280
|
)
|
||
Leases
|
(1,979
|
)
|
|
(2,081
|
)
|
||
Other
|
(343
|
)
|
|
(326
|
)
|
||
Total deferred tax liabilities
|
(7,518
|
)
|
|
(7,687
|
)
|
||
Net deferred tax asset
|
$
|
616
|
|
|
$
|
1,135
|
|
•
|
Level 1 – Observable inputs such as quoted prices in active markets;
|
•
|
Level 2 – Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and
|
•
|
Level 3 – Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.
|
|
Fair Value Measurements as of December 31, 2019
|
||||||||||||||
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
Short-term investments (1), (2):
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
333
|
|
|
$
|
333
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Bank notes/certificates of deposit/time deposits
|
2,107
|
|
|
—
|
|
|
2,107
|
|
|
—
|
|
||||
Corporate obligations
|
1,021
|
|
|
—
|
|
|
1,021
|
|
|
—
|
|
||||
Repurchase agreements
|
85
|
|
|
—
|
|
|
85
|
|
|
—
|
|
||||
|
3,546
|
|
|
333
|
|
|
3,213
|
|
|
—
|
|
||||
Restricted cash and short-term investments (1)
|
158
|
|
|
10
|
|
|
148
|
|
|
—
|
|
||||
Long-term investments (3)
|
204
|
|
|
204
|
|
|
—
|
|
|
—
|
|
||||
Total
|
$
|
3,908
|
|
|
$
|
547
|
|
|
$
|
3,361
|
|
|
$
|
—
|
|
|
Fair Value Measurements as of December 31, 2018
|
||||||||||||||
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
Short-term investments (1):
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
16
|
|
|
$
|
16
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Bank notes/certificates of deposit/time deposits
|
2,436
|
|
|
—
|
|
|
2,436
|
|
|
—
|
|
||||
Corporate obligations
|
1,658
|
|
|
—
|
|
|
1,658
|
|
|
—
|
|
||||
Repurchase agreements
|
375
|
|
|
—
|
|
|
375
|
|
|
—
|
|
||||
|
4,485
|
|
|
16
|
|
|
4,469
|
|
|
—
|
|
||||
Restricted cash and short-term investments (1)
|
154
|
|
|
12
|
|
|
142
|
|
|
—
|
|
||||
Long-term investments (3)
|
189
|
|
|
189
|
|
|
—
|
|
|
—
|
|
||||
Total
|
$
|
4,828
|
|
|
$
|
217
|
|
|
$
|
4,611
|
|
|
$
|
—
|
|
|
(1)
|
Unrealized gains and losses on short-term investments are recorded in accumulated other comprehensive loss at each measurement date.
|
(2)
|
All short-term investments are classified as available-for-sale and stated at fair value. Our short-term investments as of December 31, 2019 mature in one year or less except for $1.1 billion of bank notes/certificates of deposit/time deposits and $95 million of corporate obligations.
|
(3)
|
Long-term investments primarily include our equity investment in China Southern Airlines, in which we presently own a 2.2% equity interest, and are classified in other assets on the consolidated balance sheets.
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||||
|
Carrying
Value
|
|
Fair
Value
|
|
Carrying
Value
|
|
Fair
Value
|
||||||||
Long-term debt, including current maturities
|
$
|
23,645
|
|
|
$
|
24,508
|
|
|
$
|
23,779
|
|
|
$
|
23,775
|
|
|
Pension Benefits
|
|
Retiree Medical and
Other Postretirement Benefits
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
(In millions)
|
||||||||||||||
Benefit obligation at beginning of period
|
$
|
16,378
|
|
|
$
|
18,275
|
|
|
$
|
837
|
|
|
$
|
1,011
|
|
Service cost
|
2
|
|
|
3
|
|
|
3
|
|
|
5
|
|
||||
Interest cost
|
703
|
|
|
674
|
|
|
33
|
|
|
35
|
|
||||
Actuarial (gain) loss (1), (2)
|
1,965
|
|
|
(1,910
|
)
|
|
20
|
|
|
(133
|
)
|
||||
Settlements
|
(2
|
)
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
||||
Benefit payments
|
(689
|
)
|
|
(662
|
)
|
|
(74
|
)
|
|
(81
|
)
|
||||
Other
|
1
|
|
|
2
|
|
|
5
|
|
|
—
|
|
||||
Benefit obligation at end of period
|
$
|
18,358
|
|
|
$
|
16,378
|
|
|
$
|
824
|
|
|
$
|
837
|
|
|
Pension Benefits
|
|
Retiree Medical and
Other Postretirement Benefits
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
(In millions)
|
||||||||||||||
Fair value of plan assets at beginning of period
|
$
|
10,053
|
|
|
$
|
11,395
|
|
|
$
|
225
|
|
|
$
|
295
|
|
Actual return (loss) on plan assets
|
2,305
|
|
|
(1,151
|
)
|
|
41
|
|
|
(24
|
)
|
||||
Employer contributions (3)
|
1,230
|
|
|
475
|
|
|
12
|
|
|
35
|
|
||||
Settlements
|
(2
|
)
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
||||
Benefit payments
|
(689
|
)
|
|
(662
|
)
|
|
(74
|
)
|
|
(81
|
)
|
||||
Fair value of plan assets at end of period
|
$
|
12,897
|
|
|
$
|
10,053
|
|
|
$
|
204
|
|
|
$
|
225
|
|
Funded status at end of period
|
$
|
(5,461
|
)
|
|
$
|
(6,325
|
)
|
|
$
|
(620
|
)
|
|
$
|
(612
|
)
|
|
(1)
|
The 2019 and 2018 pension actuarial (gain) loss primarily relates to changes in our weighted average discount rate and mortality assumption and, in 2018, changes to our retirement rate assumptions.
|
(2)
|
The 2019 retiree medical and other postretirement benefits actuarial loss primarily relates to changes in our weighted average discount rate assumption and plan experience adjustments.
|
(3)
|
During 2019, we contributed $1.2 billion to our defined benefit pension plans, including supplemental contributions of $444 million and a $786 million minimum required contribution. During 2018, we contributed $475 million to our defined benefit pension plans, including supplemental contributions of $433 million and a $42 million minimum required contribution.
|
|
Pension Benefits
|
|
Retiree Medical and
Other Postretirement Benefits
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
(In millions)
|
||||||||||||||
As of December 31,
|
|
|
|
|
|
|
|
||||||||
Current liability
|
$
|
5
|
|
|
$
|
7
|
|
|
$
|
24
|
|
|
$
|
23
|
|
Noncurrent liability
|
5,456
|
|
|
6,318
|
|
|
596
|
|
|
589
|
|
||||
Total liabilities
|
$
|
5,461
|
|
|
$
|
6,325
|
|
|
$
|
620
|
|
|
$
|
612
|
|
Net actuarial loss (gain)
|
$
|
5,680
|
|
|
$
|
5,356
|
|
|
$
|
(426
|
)
|
|
$
|
(452
|
)
|
Prior service cost (benefit)
|
104
|
|
|
131
|
|
|
(120
|
)
|
|
(362
|
)
|
||||
Total accumulated other comprehensive loss (income), pre-tax
|
$
|
5,784
|
|
|
$
|
5,487
|
|
|
$
|
(546
|
)
|
|
$
|
(814
|
)
|
|
Pension Benefits
|
|
Retiree Medical and
Other Postretirement Benefits
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
(In millions)
|
||||||||||||||
Projected benefit obligation
|
$
|
18,327
|
|
|
$
|
16,351
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Accumulated benefit obligation (ABO)
|
18,315
|
|
|
16,341
|
|
|
—
|
|
|
—
|
|
||||
Accumulated postretirement benefit obligation
|
—
|
|
|
—
|
|
|
824
|
|
|
837
|
|
||||
Fair value of plan assets
|
12,862
|
|
|
10,023
|
|
|
204
|
|
|
225
|
|
||||
ABO less fair value of plan assets
|
5,453
|
|
|
6,318
|
|
|
—
|
|
|
—
|
|
|
Pension Benefits
|
|
Retiree Medical and
Other Postretirement Benefits
|
||||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|
2019
|
|
2018
|
|
2017
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
(In millions)
|
||||||||||||||||||||||
Defined benefit plans:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Service cost
|
$
|
2
|
|
|
$
|
3
|
|
|
$
|
2
|
|
|
$
|
3
|
|
|
$
|
5
|
|
|
$
|
4
|
|
Interest cost
|
703
|
|
|
674
|
|
|
721
|
|
|
33
|
|
|
35
|
|
|
39
|
|
||||||
Expected return on assets
|
(815
|
)
|
|
(905
|
)
|
|
(790
|
)
|
|
(15
|
)
|
|
(24
|
)
|
|
(21
|
)
|
||||||
Settlements
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Amortization of:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Prior service cost (benefit)
|
28
|
|
|
28
|
|
|
28
|
|
|
(236
|
)
|
|
(236
|
)
|
|
(237
|
)
|
||||||
Unrecognized net loss (gain)
|
150
|
|
|
141
|
|
|
144
|
|
|
(31
|
)
|
|
(21
|
)
|
|
(23
|
)
|
||||||
Net periodic benefit cost (income)
|
$
|
68
|
|
|
$
|
(59
|
)
|
|
$
|
106
|
|
|
$
|
(246
|
)
|
|
$
|
(241
|
)
|
|
$
|
(238
|
)
|
|
Pension Benefits
|
|
Retiree Medical and
Other Postretirement Benefits
|
||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Benefit obligations:
|
|
|
|
|
|
|
|
Weighted average discount rate
|
3.4%
|
|
4.4%
|
|
3.3%
|
|
4.3%
|
|
Pension Benefits
|
|
Retiree Medical and
Other Postretirement Benefits
|
||||||||
|
2019
|
|
2018
|
|
2017
|
|
2019
|
|
2018
|
|
2017
|
Net periodic benefit cost (income):
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average discount rate
|
4.4%
|
|
3.8%
|
|
4.3%
|
|
4.3%
|
|
3.6%
|
|
4.1%
|
Weighted average expected rate of return on plan assets
|
8.0%
|
|
8.0%
|
|
8.0%
|
|
8.0%
|
|
8.0%
|
|
8.0%
|
Weighted average health care cost trend rate assumed for next year (1)
|
N/A
|
|
N/A
|
|
N/A
|
|
3.7%
|
|
3.9%
|
|
4.2%
|
|
(1)
|
The weighted average health care cost trend rate at December 31, 2019 is assumed to decline gradually to 3.3% by 2027 and remain level thereafter.
|
|
1% Increase
|
|
1% Decrease
|
||||
Increase (decrease) on 2019 service and interest cost
|
$
|
1
|
|
|
$
|
(1
|
)
|
Increase (decrease) on benefit obligation as of December 31, 2019
|
40
|
|
|
(40
|
)
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
2024
|
|
2025-2029
|
||||||||||||
Pension benefits
|
$
|
753
|
|
|
$
|
792
|
|
|
$
|
832
|
|
|
$
|
874
|
|
|
$
|
914
|
|
|
$
|
5,045
|
|
Retiree medical and other postretirement benefits
|
80
|
|
|
71
|
|
|
66
|
|
|
64
|
|
|
61
|
|
|
265
|
|
Asset Class/Sub-Class
|
Allowed Range
|
Equity
|
45% - 80%
|
Public:
|
|
U.S. Large
|
15% - 40%
|
U.S. Small/Mid
|
2% - 10%
|
International
|
10% - 25%
|
Emerging Markets
|
2% - 15%
|
Alternative Investments
|
5% - 30%
|
Fixed Income
|
20% - 55%
|
Public:
|
|
U.S. Long Duration
|
15% - 45%
|
High Yield and Emerging Markets
|
0% - 10%
|
Private Income
|
0% - 10%
|
Other
|
0% - 5%
|
Cash Equivalents
|
0% - 20%
|
|
Fair Value Measurements as of December 31, 2019
|
||||||||||||||
Asset Category
|
Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)
|
|
Significant
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Total
|
||||||||
Cash and cash equivalents
|
$
|
20
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
20
|
|
Equity securities:
|
|
|
|
|
|
|
|
||||||||
International markets (a), (b)
|
2,769
|
|
|
—
|
|
|
—
|
|
|
2,769
|
|
||||
Large-cap companies (b)
|
2,312
|
|
|
—
|
|
|
—
|
|
|
2,312
|
|
||||
Mid-cap companies (b)
|
543
|
|
|
—
|
|
|
—
|
|
|
543
|
|
||||
Small-cap companies (b)
|
97
|
|
|
—
|
|
|
—
|
|
|
97
|
|
||||
Mutual funds (c)
|
68
|
|
|
—
|
|
|
—
|
|
|
68
|
|
||||
Fixed income:
|
|
|
|
|
|
|
|
||||||||
Corporate debt (d)
|
—
|
|
|
2,804
|
|
|
—
|
|
|
2,804
|
|
||||
Government securities (e)
|
—
|
|
|
923
|
|
|
—
|
|
|
923
|
|
||||
U.S. municipal securities
|
—
|
|
|
51
|
|
|
—
|
|
|
51
|
|
||||
Mortgage backed securities
|
—
|
|
|
4
|
|
|
—
|
|
|
4
|
|
||||
Alternative instruments:
|
|
|
|
|
|
|
|
||||||||
Private market partnerships (f)
|
—
|
|
|
—
|
|
|
10
|
|
|
10
|
|
||||
Private market partnerships measured at net asset value (f), (g)
|
—
|
|
|
—
|
|
|
—
|
|
|
1,464
|
|
||||
Common/collective trusts (h)
|
—
|
|
|
358
|
|
|
—
|
|
|
358
|
|
||||
Common/collective trusts and 103-12 Investment Trust measured at net asset value (g), (h)
|
—
|
|
|
—
|
|
|
—
|
|
|
1,423
|
|
||||
Insurance group annuity contracts
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
||||
Dividend and interest receivable
|
53
|
|
|
—
|
|
|
—
|
|
|
53
|
|
||||
Due to/from brokers for sale of securities – net
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
||||
Total
|
$
|
5,858
|
|
|
$
|
4,140
|
|
|
$
|
12
|
|
|
$
|
12,897
|
|
|
(a)
|
Holdings are diversified as follows: 14% United Kingdom, 8% Switzerland, 8% Ireland, 7% Japan, 7% France, 6% South Korea, 6% Canada, 18% emerging markets and the remaining 26% with no concentration greater than 5% in any one country.
|
(b)
|
There are no significant concentrations of holdings by company or industry.
|
(c)
|
Investment includes mutual funds invested 40% in equity securities of large-cap, mid-cap and small-cap U.S. companies, 33% in U.S. treasuries and corporate bonds and 27% in equity securities of international companies.
|
(d)
|
Includes approximately 76% investments in corporate debt with a S&P rating lower than A and 24% investments in corporate debt with a S&P rating A or higher. Holdings include 86% U.S. companies, 11% international companies and 3% emerging market companies.
|
(e)
|
Includes approximately 79% investments in U.S. domestic government securities, 13% in emerging market government securities and 8% in international government securities. There are no significant foreign currency risks within this classification.
|
(f)
|
Includes limited partnerships that invest primarily in domestic private equity and private income opportunities. The pension plan’s master trust does not have the right to redeem its limited partnership investment at its net asset value, but rather receives distributions as the underlying assets are liquidated. It is estimated that the underlying assets of these funds will be gradually liquidated over the next one to ten years. Additionally, the pension plan’s master trust has future funding commitments of approximately $1.4 billion over the next ten years.
|
(g)
|
Certain investments that are measured using net asset value per share (or its equivalent) as a practical expedient for fair value have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the notes to the consolidated financial statements.
|
(h)
|
Investment includes 36% in a common/collective trust investing in securities of larger companies within the U.S., 29% in a common/collective trust investing in securities of smaller companies located outside the U.S., 16% in a collective interest trust investing primarily in short-term securities, 15% in an emerging market 103-12 Investment Trust with investments in emerging country equity securities and 4% in Canadian segregated balanced value, income growth and diversified pooled funds. For some trusts, requests for withdrawals must meet specific requirements with advance notice of redemption preferred.
|
|
Fair Value Measurements as of December 31, 2018
|
||||||||||||||
Asset Category
|
Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)
|
|
Significant
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Total
|
||||||||
Cash and cash equivalents
|
$
|
23
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
23
|
|
Equity securities:
|
|
|
|
|
|
|
|
||||||||
International markets (a), (b)
|
3,181
|
|
|
—
|
|
|
—
|
|
|
3,181
|
|
||||
Large-cap companies (b)
|
2,021
|
|
|
—
|
|
|
—
|
|
|
2,021
|
|
||||
Mid-cap companies (b)
|
583
|
|
|
—
|
|
|
—
|
|
|
583
|
|
||||
Small-cap companies (b)
|
122
|
|
|
—
|
|
|
—
|
|
|
122
|
|
||||
Mutual funds (c)
|
52
|
|
|
—
|
|
|
—
|
|
|
52
|
|
||||
Fixed income:
|
|
|
|
|
|
|
|
||||||||
Corporate debt (d)
|
—
|
|
|
2,116
|
|
|
—
|
|
|
2,116
|
|
||||
Government securities (e)
|
—
|
|
|
228
|
|
|
—
|
|
|
228
|
|
||||
U.S. municipal securities
|
—
|
|
|
40
|
|
|
—
|
|
|
40
|
|
||||
Alternative instruments:
|
|
|
|
|
|
|
|
||||||||
Private market partnerships (f)
|
—
|
|
|
—
|
|
|
7
|
|
|
7
|
|
||||
Private market partnerships measured at net asset value (f), (g)
|
—
|
|
|
—
|
|
|
—
|
|
|
1,188
|
|
||||
Common/collective trusts (h)
|
—
|
|
|
218
|
|
|
—
|
|
|
218
|
|
||||
Common/collective trusts and 103-12 Investment Trust measured at net asset value (g), (h)
|
—
|
|
|
—
|
|
|
—
|
|
|
227
|
|
||||
Insurance group annuity contracts
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
||||
Dividend and interest receivable
|
47
|
|
|
—
|
|
|
—
|
|
|
47
|
|
||||
Due to/from brokers for sale of securities – net
|
5
|
|
|
—
|
|
|
—
|
|
|
5
|
|
||||
Other liabilities – net
|
(7
|
)
|
|
—
|
|
|
—
|
|
|
(7
|
)
|
||||
Total
|
$
|
6,027
|
|
|
$
|
2,602
|
|
|
$
|
9
|
|
|
$
|
10,053
|
|
|
(a)
|
Holdings are diversified as follows: 17% United Kingdom, 10% Japan, 8% France, 7% Switzerland, 6% Ireland, 17% emerging markets and the remaining 35% with no concentration greater than 5% in any one country.
|
(b)
|
There are no significant concentrations of holdings by company or industry.
|
(c)
|
Investment includes mutual funds invested 37% in equity securities of large-cap, mid-cap and small-cap U.S. companies, 38% in U.S. treasuries and corporate bonds and 25% in equity securities of international companies.
|
(d)
|
Includes approximately 77% investments in corporate debt with a S&P rating lower than A and 23% investments in corporate debt with a S&P rating A or higher. Holdings include 85% U.S. companies, 12% international companies and 3% emerging market companies.
|
(e)
|
Includes approximately 32% investments in U.S. domestic government securities, 37% in emerging market government securities and 31% in international government securities. There are no significant foreign currency risks within this classification.
|
(f)
|
Includes limited partnerships that invest primarily in U.S. (94%) and European (6%) buyout opportunities of a range of privately held companies. The pension plan’s master trust does not have the right to redeem its limited partnership investment at its net asset value, but rather receives distributions as the underlying assets are liquidated. It is estimated that the underlying assets of these funds will be gradually liquidated over the next one to ten years. Additionally, the pension plan’s master trust has future funding commitments of approximately $1.0 billion over the next ten years.
|
(g)
|
Certain investments that are measured using net asset value per share (or its equivalent) as a practical expedient for fair value have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the notes to the consolidated financial statements.
|
(h)
|
Investment includes 45% in an emerging market 103-12 Investment Trust with investments in emerging country equity securities, 37% in a collective interest trust investing primarily in short-term securities, 12% in Canadian segregated balanced value, income growth and diversified pooled funds and 6% in a common/collective trust investing in securities of smaller companies located outside the U.S., including developing markets. For some trusts, requests for withdrawals must meet specific requirements with advance notice of redemption preferred.
|
|
Private Market Partnerships
|
|
Insurance Group
Annuity Contracts
|
||||
Beginning balance at December 31, 2018
|
$
|
7
|
|
|
$
|
2
|
|
Purchases
|
3
|
|
|
—
|
|
||
Ending balance at December 31, 2019
|
$
|
10
|
|
|
$
|
2
|
|
|
Private Market
Partnerships
|
|
Insurance Group
Annuity Contracts
|
||||
Beginning balance at December 31, 2017
|
$
|
14
|
|
|
$
|
2
|
|
Actual loss on plan assets:
|
|
|
|
||||
Relating to assets still held at the reporting date
|
(2
|
)
|
|
—
|
|
||
Purchases
|
1
|
|
|
—
|
|
||
Sales
|
(6
|
)
|
|
—
|
|
||
Ending balance at December 31, 2018
|
$
|
7
|
|
|
$
|
2
|
|
|
Fair Value Measurements as of December 31, 2019
|
||||||||||||||
Asset Category
|
Quoted Prices in
Active Markets for Identical Assets
(Level 1)
|
|
Significant
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Total
|
||||||||
Money market fund
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4
|
|
Mutual funds – AAL Class
|
—
|
|
|
200
|
|
|
—
|
|
|
200
|
|
||||
Total
|
$
|
4
|
|
|
$
|
200
|
|
|
$
|
—
|
|
|
$
|
204
|
|
|
Fair Value Measurements as of December 31, 2018
|
||||||||||||||
Asset Category
|
Quoted Prices in
Active Markets for Identical Assets
(Level 1)
|
|
Significant
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Total
|
||||||||
Money market fund
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4
|
|
Mutual funds – AAL Class
|
—
|
|
|
221
|
|
|
—
|
|
|
221
|
|
||||
Total
|
$
|
4
|
|
|
$
|
221
|
|
|
$
|
—
|
|
|
$
|
225
|
|
|
Pension,
Retiree Medical and Other Postretirement Benefits |
|
Unrealized Gain (Loss) on Investments
|
|
Income Tax
Benefit (Provision) (1) |
|
Total
|
||||||||
Balance at December 31, 2017
|
$
|
(4,523
|
)
|
|
$
|
(1
|
)
|
|
$
|
(1,252
|
)
|
|
$
|
(5,776
|
)
|
Other comprehensive income (loss) before reclassifications
|
(62
|
)
|
|
(4
|
)
|
|
15
|
|
|
(51
|
)
|
||||
Amounts reclassified from AOCI
|
(88
|
)
|
|
—
|
|
|
19
|
|
(2)
|
(69
|
)
|
||||
Net current-period other comprehensive income (loss)
|
(150
|
)
|
|
(4
|
)
|
|
34
|
|
|
(120
|
)
|
||||
Balance at December 31, 2018
|
(4,673
|
)
|
|
(5
|
)
|
|
(1,218
|
)
|
|
(5,896
|
)
|
||||
Other comprehensive income (loss) before reclassifications
|
(476
|
)
|
|
3
|
|
|
107
|
|
|
(366
|
)
|
||||
Amounts reclassified from AOCI
|
(89
|
)
|
|
—
|
|
|
20
|
|
(2)
|
(69
|
)
|
||||
Net current-period other comprehensive income (loss)
|
(565
|
)
|
|
3
|
|
|
127
|
|
|
(435
|
)
|
||||
Balance at December 31, 2019
|
$
|
(5,238
|
)
|
|
$
|
(2
|
)
|
|
$
|
(1,091
|
)
|
|
$
|
(6,331
|
)
|
|
(1)
|
Relates principally to pension, retiree medical and other postretirement benefits obligations that will not be recognized in net income until the obligations are fully extinguished.
|
(2)
|
Relates to pension, retiree medical and other postretirement benefits obligations and is recognized within the income tax provision on our consolidated statements of operations.
|
|
Amounts reclassified from AOCI
|
|
Affected line items on the
consolidated statements of operations |
||||||
|
Year Ended December 31,
|
|
|||||||
AOCI Components
|
2019
|
|
2018
|
|
|||||
Amortization of pension, retiree medical and other postretirement benefits:
|
|
|
|
|
|
||||
Prior service benefit
|
$
|
(162
|
)
|
|
$
|
(161
|
)
|
|
Nonoperating other income, net
|
Actuarial loss
|
93
|
|
|
92
|
|
|
Nonoperating other income, net
|
||
Total reclassifications for the period, net of tax
|
$
|
(69
|
)
|
|
$
|
(69
|
)
|
|
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
2024
|
|
2025 and Thereafter
|
|
Total
|
||||||||||||||
Payments for aircraft commitments and certain engines (1)
|
$
|
1,629
|
|
|
$
|
750
|
|
|
$
|
1,599
|
|
|
$
|
1,543
|
|
|
$
|
2,574
|
|
|
$
|
4,855
|
|
|
$
|
12,950
|
|
|
(1)
|
These amounts are net of purchase deposits currently held by the manufacturers. We have granted a security interest in certain of our purchase deposits with Boeing. Our purchase deposits held by all manufacturers totaled $1.7 billion as of December 31, 2019.
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
2024
|
|
2025 and Thereafter
|
|
Total
|
||||||||||||||
Minimum obligations under capacity purchase agreements with third-party regional carriers (1)
|
$
|
1,115
|
|
|
$
|
1,185
|
|
|
$
|
1,126
|
|
|
$
|
1,077
|
|
|
$
|
1,077
|
|
|
$
|
3,402
|
|
|
$
|
8,982
|
|
|
(1)
|
Represents minimum payments under capacity purchase agreements with third-party regional carriers, which are estimates of costs based on assumed minimum levels of flying under the capacity purchase agreements and American’s actual payments could differ materially. Excludes payments for the lease of certain aircraft under capacity purchase agreements, which are reflected in the operating lease obligations in Note 6.
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Non-cash investing and financing activities:
|
|
|
|
|
|
||||||
Settlement of bankruptcy obligations
|
$
|
7
|
|
|
$
|
—
|
|
|
$
|
15
|
|
Equity Investment
|
—
|
|
|
—
|
|
|
120
|
|
|||
Supplemental information:
|
|
|
|
|
|
||||||
Interest paid, net
|
1,111
|
|
|
1,091
|
|
|
1,040
|
|
|||
Income taxes paid
|
8
|
|
|
18
|
|
|
20
|
|
|
Number of Shares
|
|
Weighted Average Grant Date Fair Value
|
|||
|
(In thousands)
|
|
|
|||
Outstanding at December 31, 2016
|
5,187
|
|
|
$
|
41.48
|
|
Granted
|
2,309
|
|
|
48.58
|
|
|
Vested and released
|
(2,708
|
)
|
|
39.63
|
|
|
Forfeited
|
(464
|
)
|
|
44.48
|
|
|
Outstanding at December 31, 2017
|
4,324
|
|
|
$
|
46.94
|
|
Granted
|
2,194
|
|
|
47.65
|
|
|
Vested and released
|
(1,999
|
)
|
|
44.99
|
|
|
Forfeited
|
(199
|
)
|
|
45.72
|
|
|
Outstanding at December 31, 2018
|
4,320
|
|
|
$
|
44.29
|
|
Granted
|
3,206
|
|
|
34.00
|
|
|
Vested and released
|
(2,002
|
)
|
|
44.90
|
|
|
Forfeited
|
(337
|
)
|
|
42.55
|
|
|
Outstanding at December 31, 2019
|
5,187
|
|
|
$
|
37.01
|
|
|
Balance at Beginning of Year
|
|
Additions Charged to Statement of Operations Accounts
|
|
Deductions
|
|
Balance at
End of Year
|
||||||||
Allowance for obsolescence of spare parts
|
|
|
|
|
|
|
|
||||||||
Year ended December 31, 2019
|
$
|
814
|
|
|
$
|
91
|
|
|
$
|
(121
|
)
|
|
$
|
784
|
|
Year ended December 31, 2018
|
769
|
|
|
70
|
|
|
(25
|
)
|
|
814
|
|
||||
Year ended December 31, 2017
|
765
|
|
|
29
|
|
|
(25
|
)
|
|
769
|
|
||||
Allowance for uncollectible accounts
|
|
|
|
|
|
|
|
||||||||
Year ended December 31, 2019
|
$
|
29
|
|
|
$
|
19
|
|
|
$
|
(17
|
)
|
|
$
|
31
|
|
Year ended December 31, 2018
|
24
|
|
|
42
|
|
|
(37
|
)
|
|
29
|
|
||||
Year ended December 31, 2017
|
36
|
|
|
43
|
|
|
(55
|
)
|
|
24
|
|
|
First Quarter
|
|
Second Quarter
|
|
Third Quarter
|
|
Fourth Quarter
|
||||||||
2019
|
|
|
|
|
|
|
|
||||||||
Operating revenues
|
$
|
10,584
|
|
|
$
|
11,960
|
|
|
$
|
11,911
|
|
|
$
|
11,313
|
|
Operating expenses
|
10,209
|
|
|
10,807
|
|
|
11,103
|
|
|
10,584
|
|
||||
Operating income
|
375
|
|
|
1,153
|
|
|
808
|
|
|
729
|
|
||||
Net income
|
185
|
|
|
662
|
|
|
425
|
|
|
414
|
|
||||
Earnings per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.41
|
|
|
$
|
1.49
|
|
|
$
|
0.96
|
|
|
$
|
0.95
|
|
Diluted
|
$
|
0.41
|
|
|
$
|
1.49
|
|
|
$
|
0.96
|
|
|
$
|
0.95
|
|
Shares used for computation (in thousands):
|
|
|
|
|
|
|
|
||||||||
Basic
|
451,951
|
|
|
445,008
|
|
|
441,915
|
|
|
434,578
|
|
||||
Diluted
|
453,429
|
|
|
445,587
|
|
|
442,401
|
|
|
435,659
|
|
||||
|
|
|
|
|
|
|
|
||||||||
2018
|
|
|
|
|
|
|
|
||||||||
Operating revenues
|
$
|
10,401
|
|
|
$
|
11,643
|
|
|
$
|
11,559
|
|
|
$
|
10,938
|
|
Operating expenses
|
10,005
|
|
|
10,639
|
|
|
10,874
|
|
|
10,367
|
|
||||
Operating income
|
396
|
|
|
1,004
|
|
|
685
|
|
|
571
|
|
||||
Net income
|
159
|
|
|
556
|
|
|
372
|
|
|
325
|
|
||||
Earnings per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.34
|
|
|
$
|
1.20
|
|
|
$
|
0.81
|
|
|
$
|
0.71
|
|
Diluted
|
$
|
0.34
|
|
|
$
|
1.20
|
|
|
$
|
0.81
|
|
|
$
|
0.70
|
|
Shares used for computation (in thousands):
|
|
|
|
|
|
|
|
||||||||
Basic
|
472,297
|
|
|
463,533
|
|
|
460,526
|
|
|
460,589
|
|
||||
Diluted
|
474,598
|
|
|
464,618
|
|
|
461,507
|
|
|
461,915
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Operating revenues:
|
|
|
|
|
|
||||||
Passenger
|
$
|
42,010
|
|
|
$
|
40,676
|
|
|
$
|
39,131
|
|
Cargo
|
863
|
|
|
1,013
|
|
|
890
|
|
|||
Other
|
2,888
|
|
|
2,841
|
|
|
2,589
|
|
|||
Total operating revenues
|
45,761
|
|
|
44,530
|
|
|
42,610
|
|
|||
Operating expenses:
|
|
|
|
|
|
||||||
Aircraft fuel and related taxes
|
7,526
|
|
|
8,053
|
|
|
6,128
|
|
|||
Salaries, wages and benefits
|
12,600
|
|
|
12,240
|
|
|
11,942
|
|
|||
Regional expenses
|
7,518
|
|
|
7,064
|
|
|
6,572
|
|
|||
Maintenance, materials and repairs
|
2,380
|
|
|
2,050
|
|
|
1,959
|
|
|||
Other rent and landing fees
|
2,055
|
|
|
1,900
|
|
|
1,806
|
|
|||
Aircraft rent
|
1,326
|
|
|
1,264
|
|
|
1,197
|
|
|||
Selling expenses
|
1,602
|
|
|
1,520
|
|
|
1,477
|
|
|||
Depreciation and amortization
|
1,982
|
|
|
1,839
|
|
|
1,702
|
|
|||
Special items, net
|
635
|
|
|
787
|
|
|
712
|
|
|||
Other
|
5,090
|
|
|
5,090
|
|
|
4,910
|
|
|||
Total operating expenses
|
42,714
|
|
|
41,807
|
|
|
38,405
|
|
|||
Operating income
|
3,047
|
|
|
2,723
|
|
|
4,205
|
|
|||
Nonoperating income (expense):
|
|
|
|
|
|
||||||
Interest income
|
515
|
|
|
330
|
|
|
215
|
|
|||
Interest expense, net
|
(1,109
|
)
|
|
(1,028
|
)
|
|
(988
|
)
|
|||
Other income, net
|
152
|
|
|
167
|
|
|
123
|
|
|||
Total nonoperating expense, net
|
(442
|
)
|
|
(531
|
)
|
|
(650
|
)
|
|||
Income before income taxes
|
2,605
|
|
|
2,192
|
|
|
3,555
|
|
|||
Income tax provision
|
633
|
|
|
534
|
|
|
2,270
|
|
|||
Net income
|
$
|
1,972
|
|
|
$
|
1,658
|
|
|
$
|
1,285
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Net income
|
$
|
1,972
|
|
|
$
|
1,658
|
|
|
$
|
1,285
|
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
||||||
Pension, retiree medical and other postretirement benefits
|
(434
|
)
|
|
(116
|
)
|
|
(68
|
)
|
|||
Investments
|
3
|
|
|
(3
|
)
|
|
(1
|
)
|
|||
Total other comprehensive loss, net of tax
|
(431
|
)
|
|
(119
|
)
|
|
(69
|
)
|
|||
Total comprehensive income
|
$
|
1,541
|
|
|
$
|
1,539
|
|
|
$
|
1,216
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
ASSETS
|
|
|
|
||||
Current assets
|
|
|
|
||||
Cash
|
$
|
267
|
|
|
$
|
265
|
|
Short-term investments
|
3,543
|
|
|
4,482
|
|
||
Restricted cash and short-term investments
|
158
|
|
|
154
|
|
||
Accounts receivable, net
|
1,770
|
|
|
1,755
|
|
||
Receivables from related parties, net
|
12,451
|
|
|
10,666
|
|
||
Aircraft fuel, spare parts and supplies, net
|
1,754
|
|
|
1,442
|
|
||
Prepaid expenses and other
|
584
|
|
|
493
|
|
||
Total current assets
|
20,527
|
|
|
19,257
|
|
||
Operating property and equipment
|
|
|
|
||||
Flight equipment
|
42,213
|
|
|
41,180
|
|
||
Ground property and equipment
|
9,089
|
|
|
8,466
|
|
||
Equipment purchase deposits
|
1,674
|
|
|
1,277
|
|
||
Total property and equipment, at cost
|
52,976
|
|
|
50,923
|
|
||
Less accumulated depreciation and amortization
|
(18,335
|
)
|
|
(17,123
|
)
|
||
Total property and equipment, net
|
34,641
|
|
|
33,800
|
|
||
Operating lease right-of-use assets
|
8,694
|
|
|
9,094
|
|
||
Other assets
|
|
|
|
||||
Goodwill
|
4,091
|
|
|
4,091
|
|
||
Intangibles, net of accumulated amortization of $704 and $663, respectively
|
2,084
|
|
|
2,137
|
|
||
Deferred tax asset
|
689
|
|
|
1,280
|
|
||
Other assets
|
1,164
|
|
|
1,219
|
|
||
Total other assets
|
8,028
|
|
|
8,727
|
|
||
Total assets
|
$
|
71,890
|
|
|
$
|
70,878
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDER’S EQUITY
|
|
|
|
||||
Current liabilities
|
|
|
|
||||
Current maturities of long-term debt and finance leases
|
$
|
2,358
|
|
|
$
|
2,547
|
|
Accounts payable
|
1,990
|
|
|
1,707
|
|
||
Accrued salaries and wages
|
1,461
|
|
|
1,363
|
|
||
Air traffic liability
|
4,808
|
|
|
4,339
|
|
||
Loyalty program liability
|
3,193
|
|
|
3,267
|
|
||
Operating lease liabilities
|
1,695
|
|
|
1,639
|
|
||
Other accrued liabilities
|
2,055
|
|
|
2,259
|
|
||
Total current liabilities
|
17,560
|
|
|
17,121
|
|
||
Noncurrent liabilities
|
|
|
|
||||
Long-term debt and finance leases, net of current maturities
|
20,684
|
|
|
20,650
|
|
||
Pension and postretirement benefits
|
6,008
|
|
|
6,863
|
|
||
Loyalty program liability
|
5,422
|
|
|
5,272
|
|
||
Operating lease liabilities
|
7,388
|
|
|
7,857
|
|
||
Other liabilities
|
1,406
|
|
|
1,345
|
|
||
Total noncurrent liabilities
|
40,908
|
|
|
41,987
|
|
||
Commitments and contingencies (Note 10)
|
|
|
|
||||
Stockholder’s equity
|
|
|
|
||||
Common stock, $1.00 par value; 1,000 shares authorized, issued and outstanding
|
—
|
|
|
—
|
|
||
Additional paid-in capital
|
16,903
|
|
|
16,802
|
|
||
Accumulated other comprehensive loss
|
(6,423
|
)
|
|
(5,992
|
)
|
||
Retained earnings
|
2,942
|
|
|
960
|
|
||
Total stockholder’s equity
|
13,422
|
|
|
11,770
|
|
||
Total liabilities and stockholder’s equity
|
$
|
71,890
|
|
|
$
|
70,878
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
||||||
Net income
|
$
|
1,972
|
|
|
$
|
1,658
|
|
|
$
|
1,285
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
2,267
|
|
|
2,108
|
|
|
1,964
|
|
|||
Net loss (gains) from sale of property and equipment and sale-leaseback transactions
|
(109
|
)
|
|
(57
|
)
|
|
2
|
|
|||
Special items, net non-cash
|
384
|
|
|
458
|
|
|
272
|
|
|||
Pension and postretirement
|
(178
|
)
|
|
(302
|
)
|
|
(132
|
)
|
|||
Deferred income tax provision
|
623
|
|
|
503
|
|
|
2,246
|
|
|||
Share-based compensation
|
94
|
|
|
86
|
|
|
90
|
|
|||
Other, net
|
(56
|
)
|
|
(102
|
)
|
|
(146
|
)
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||||
Decrease (increase) in accounts receivable
|
130
|
|
|
232
|
|
|
(189
|
)
|
|||
Increase in other assets
|
(321
|
)
|
|
(354
|
)
|
|
(405
|
)
|
|||
Increase (decrease) in accounts payable and accrued liabilities
|
273
|
|
|
(171
|
)
|
|
266
|
|
|||
Increase in air traffic liability
|
469
|
|
|
297
|
|
|
65
|
|
|||
Increase in receivables from related parties, net
|
(1,772
|
)
|
|
(1,849
|
)
|
|
(1,994
|
)
|
|||
Increase (decrease) in loyalty program liability
|
76
|
|
|
(283
|
)
|
|
(308
|
)
|
|||
Contributions to pension plans
|
(1,224
|
)
|
|
(472
|
)
|
|
(286
|
)
|
|||
Increase (decrease) in other liabilities
|
(199
|
)
|
|
191
|
|
|
140
|
|
|||
Net cash provided by operating activities
|
2,429
|
|
|
1,943
|
|
|
2,870
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
||||||
Capital expenditures and aircraft purchase deposits
|
(4,156
|
)
|
|
(3,677
|
)
|
|
(5,881
|
)
|
|||
Proceeds from sale-leaseback transactions
|
850
|
|
|
1,096
|
|
|
853
|
|
|||
Proceeds from sale of property and equipment
|
49
|
|
|
106
|
|
|
69
|
|
|||
Purchases of short-term investments
|
(3,184
|
)
|
|
(3,412
|
)
|
|
(4,633
|
)
|
|||
Sales of short-term investments
|
4,144
|
|
|
3,705
|
|
|
5,915
|
|
|||
Proceeds from vendor
|
250
|
|
|
—
|
|
|
—
|
|
|||
Decrease (increase) in restricted short-term investments
|
(3
|
)
|
|
72
|
|
|
309
|
|
|||
Proceeds from sale of investments
|
—
|
|
|
207
|
|
|
—
|
|
|||
Purchase of equity investment
|
—
|
|
|
—
|
|
|
(203
|
)
|
|||
Other investing activities
|
(96
|
)
|
|
(7
|
)
|
|
—
|
|
|||
Net cash used in investing activities
|
(2,146
|
)
|
|
(1,910
|
)
|
|
(3,571
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
||||||
Proceeds from issuance of long-term debt
|
3,210
|
|
|
2,354
|
|
|
3,058
|
|
|||
Payments on long-term debt and finance leases
|
(3,440
|
)
|
|
(2,442
|
)
|
|
(2,332
|
)
|
|||
Deferred financing costs
|
(52
|
)
|
|
(59
|
)
|
|
(85
|
)
|
|||
Other financing activities
|
—
|
|
|
—
|
|
|
27
|
|
|||
Net cash provided by (used in) financing activities
|
(282
|
)
|
|
(147
|
)
|
|
668
|
|
|||
Net increase (decrease) in cash and restricted cash
|
1
|
|
|
(114
|
)
|
|
(33
|
)
|
|||
Cash and restricted cash at beginning of year
|
276
|
|
|
390
|
|
|
423
|
|
|||
Cash and restricted cash at end of year (a)
|
$
|
277
|
|
|
$
|
276
|
|
|
$
|
390
|
|
|
Cash
|
$
|
267
|
|
|
$
|
265
|
|
|
$
|
287
|
|
Restricted cash included in restricted cash and short-term investments
|
10
|
|
|
11
|
|
|
103
|
|
|||
Total cash and restricted cash
|
$
|
277
|
|
|
$
|
276
|
|
|
$
|
390
|
|
|
Common
Stock
|
|
Additional
Paid-in
Capital
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Retained
Earnings
(Deficit)
|
|
Total
|
||||||||||
Balance at December 31, 2016
|
$
|
—
|
|
|
$
|
16,624
|
|
|
$
|
(5,182
|
)
|
|
$
|
(2,862
|
)
|
|
$
|
8,580
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
1,285
|
|
|
1,285
|
|
|||||
Other comprehensive loss, net
|
—
|
|
|
—
|
|
|
(69
|
)
|
|
—
|
|
|
(69
|
)
|
|||||
Share-based compensation expense
|
—
|
|
|
90
|
|
|
—
|
|
|
—
|
|
|
90
|
|
|||||
Intercompany equity transfer
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|||||
Impact of adoption of Accounting Standards Update (ASU)
2018-02 related to comprehensive income (See Note 1(b))
|
—
|
|
|
—
|
|
|
(622
|
)
|
|
622
|
|
|
—
|
|
|||||
Balance at December 31, 2017
|
—
|
|
|
16,716
|
|
|
(5,873
|
)
|
|
(955
|
)
|
|
9,888
|
|
|||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
1,658
|
|
|
1,658
|
|
|||||
Other comprehensive loss, net
|
—
|
|
|
—
|
|
|
(119
|
)
|
|
—
|
|
|
(119
|
)
|
|||||
Share-based compensation expense
|
—
|
|
|
86
|
|
|
—
|
|
|
—
|
|
|
86
|
|
|||||
Impact of adoption of ASU 2016-01 related to financial
instruments
|
—
|
|
|
—
|
|
|
—
|
|
|
60
|
|
|
60
|
|
|||||
Impact of adoption of ASU 2016-02 related to leases
|
—
|
|
|
—
|
|
|
—
|
|
|
197
|
|
|
197
|
|
|||||
Balance at December 31, 2018
|
—
|
|
|
16,802
|
|
|
(5,992
|
)
|
|
960
|
|
|
11,770
|
|
|||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
1,972
|
|
|
1,972
|
|
|||||
Other comprehensive loss, net
|
—
|
|
|
—
|
|
|
(431
|
)
|
|
—
|
|
|
(431
|
)
|
|||||
Share-based compensation expense
|
—
|
|
|
94
|
|
|
—
|
|
|
—
|
|
|
94
|
|
|||||
Intercompany equity transfer
|
—
|
|
|
7
|
|
|
—
|
|
|
10
|
|
|
17
|
|
|||||
Balance at December 31, 2019
|
$
|
—
|
|
|
$
|
16,903
|
|
|
$
|
(6,423
|
)
|
|
$
|
2,942
|
|
|
$
|
13,422
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Domestic airport slots
|
$
|
365
|
|
|
$
|
365
|
|
Customer relationships
|
300
|
|
|
300
|
|
||
Marketing agreements
|
105
|
|
|
105
|
|
||
Tradenames
|
35
|
|
|
35
|
|
||
Airport gate leasehold rights
|
137
|
|
|
137
|
|
||
Accumulated amortization
|
(704
|
)
|
|
(663
|
)
|
||
Total
|
$
|
238
|
|
|
$
|
279
|
|
2020
|
$
|
41
|
|
2021
|
41
|
|
|
2022
|
41
|
|
|
2023
|
7
|
|
|
2024
|
7
|
|
|
2025 and thereafter
|
101
|
|
|
Total
|
$
|
238
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Passenger revenue:
|
|
|
|
|
|
||||||
Passenger travel
|
$
|
38,831
|
|
|
$
|
37,457
|
|
|
$
|
36,152
|
|
Loyalty revenue - travel (1)
|
3,179
|
|
|
3,219
|
|
|
2,979
|
|
|||
Total passenger revenue
|
42,010
|
|
|
40,676
|
|
|
39,131
|
|
|||
Cargo
|
863
|
|
|
1,013
|
|
|
890
|
|
|||
Other:
|
|
|
|
|
|
||||||
Loyalty revenue - marketing services
|
2,361
|
|
|
2,352
|
|
|
2,124
|
|
|||
Other revenue
|
527
|
|
|
489
|
|
|
465
|
|
|||
Total other revenue
|
2,888
|
|
|
2,841
|
|
|
2,589
|
|
|||
Total operating revenues
|
$
|
45,761
|
|
|
$
|
44,530
|
|
|
$
|
42,610
|
|
|
(1)
|
Loyalty revenue included in passenger revenue is principally comprised of mileage credit redemptions earned through travel or from co-branded credit card and other partners. See “Loyalty Revenue” below for further discussion on these mileage credits.
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Domestic
|
$
|
30,881
|
|
|
$
|
29,573
|
|
|
$
|
28,749
|
|
Latin America
|
5,047
|
|
|
5,125
|
|
|
4,840
|
|
|||
Atlantic
|
4,624
|
|
|
4,376
|
|
|
4,028
|
|
|||
Pacific
|
1,458
|
|
|
1,602
|
|
|
1,514
|
|
|||
Total passenger revenue
|
$
|
42,010
|
|
|
$
|
40,676
|
|
|
$
|
39,131
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Loyalty program liability
|
$
|
8,615
|
|
|
$
|
8,539
|
|
Air traffic liability
|
4,808
|
|
|
4,339
|
|
||
Total
|
$
|
13,423
|
|
|
$
|
12,878
|
|
Balance at December 31, 2018
|
$
|
8,539
|
|
Deferral of revenue
|
3,438
|
|
|
Recognition of revenue (1)
|
(3,362
|
)
|
|
Balance at December 31, 2019 (2)
|
$
|
8,615
|
|
|
(1)
|
Principally relates to revenue recognized from the redemption of mileage credits for both air and non-air travel awards. Mileage credits are combined in one homogenous pool and are not separately identifiable. As such, the revenue is comprised of miles that were part of the loyalty program deferred revenue balance at the beginning of the period, as well as miles that were issued during the period.
|
(2)
|
Mileage credits can be redeemed at any time and do not expire as long as that AAdvantage member has any type of qualifying activity at least every 18 months. As of December 31, 2019, American’s current loyalty program liability was $3.2 billion and represents American’s current estimate of revenue expected to be recognized in the next 12 months based on historical trends, with the balance reflected in long-term loyalty program liability expected to be recognized as revenue in periods thereafter.
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Aircraft fuel and related taxes
|
$
|
1,869
|
|
|
$
|
1,843
|
|
|
$
|
1,382
|
|
Salaries, wages and benefits
|
325
|
|
|
338
|
|
|
356
|
|
|||
Capacity purchases from third-party regional carriers (1)
|
3,562
|
|
|
3,267
|
|
|
3,283
|
|
|||
Maintenance, materials and repairs
|
30
|
|
|
8
|
|
|
7
|
|
|||
Other rent and landing fees
|
621
|
|
|
583
|
|
|
602
|
|
|||
Aircraft rent
|
29
|
|
|
27
|
|
|
27
|
|
|||
Selling expenses
|
402
|
|
|
369
|
|
|
361
|
|
|||
Depreciation and amortization
|
286
|
|
|
267
|
|
|
262
|
|
|||
Special items, net
|
—
|
|
|
—
|
|
|
3
|
|
|||
Other
|
394
|
|
|
362
|
|
|
289
|
|
|||
Total regional expenses
|
$
|
7,518
|
|
|
$
|
7,064
|
|
|
$
|
6,572
|
|
|
(1)
|
In 2019, 2018, and 2017, American recognized $590 million, $565 million and $544 million, respectively, of expense under its capacity purchase agreement with Republic Airline Inc. (Republic). American holds a 25% equity interest in Republic Airways Holdings Inc. (Republic Holdings), the parent company of Republic.
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Fleet restructuring expenses (1)
|
$
|
271
|
|
|
$
|
422
|
|
|
$
|
232
|
|
Fleet impairment (2)
|
213
|
|
|
—
|
|
|
—
|
|
|||
Merger integration expenses (3)
|
191
|
|
|
268
|
|
|
273
|
|
|||
Litigation reserve adjustments
|
(53
|
)
|
|
45
|
|
|
—
|
|
|||
Mark-to-market adjustments on bankruptcy obligations, net (4)
|
(11
|
)
|
|
(76
|
)
|
|
27
|
|
|||
Severance expenses (5)
|
11
|
|
|
58
|
|
|
—
|
|
|||
Intangible asset impairment (6)
|
—
|
|
|
26
|
|
|
—
|
|
|||
Labor contract expenses
|
—
|
|
|
13
|
|
|
46
|
|
|||
Employee 2017 Tax Act bonus expense (7)
|
—
|
|
|
—
|
|
|
123
|
|
|||
Other operating charges, net
|
13
|
|
|
31
|
|
|
11
|
|
|||
Mainline operating special items, net
|
635
|
|
|
787
|
|
|
712
|
|
|||
Regional operating special items, net
|
—
|
|
|
—
|
|
|
3
|
|
|||
Operating special items, net
|
635
|
|
|
787
|
|
|
715
|
|
|||
|
|
|
|
|
|
||||||
Debt refinancing and extinguishment charges
|
16
|
|
|
13
|
|
|
22
|
|
|||
Mark-to-market adjustments on equity and other investments, net (8)
|
(5
|
)
|
|
104
|
|
|
—
|
|
|||
Other nonoperating income, net
|
—
|
|
|
(4
|
)
|
|
—
|
|
|||
Nonoperating special items, net
|
11
|
|
|
113
|
|
|
22
|
|
|||
|
|
|
|
|
|
||||||
Income tax special items (9)
|
—
|
|
|
18
|
|
|
—
|
|
|||
Impact of the 2017 Tax Act (10)
|
—
|
|
|
—
|
|
|
924
|
|
|||
Income tax special items, net
|
—
|
|
|
18
|
|
|
924
|
|
|
(1)
|
Fleet restructuring expenses principally included accelerated depreciation and rent expense for aircraft and related equipment grounded or expected to be grounded earlier than planned.
|
(2)
|
Fleet impairment principally includes a non-cash write-down of aircraft related to the planned retirement of American’s Embraer E190 fleet.
|
(3)
|
Merger integration expenses included costs associated with integration projects, principally American's technical operations, flight attendant, human resources and payroll systems.
|
(4)
|
Bankruptcy obligations that will be settled in shares of AAG common stock are marked-to-market based on AAG’s stock price.
|
(5)
|
Severance expenses primarily included costs associated with reductions of management and support staff team members.
|
(6)
|
Intangible asset impairment includes a non-cash charge to write-off American’s Brazil route authority as a result of the U.S.-Brazil open skies agreement.
|
(7)
|
Employee bonus expense included costs related to the $1,000 cash bonus and associated payroll taxes granted to mainline employees in recognition of the 2017 Tax Act.
|
(8)
|
Mark-to-market adjustments on equity and other investments, net primarily relates to net unrealized gains and losses associated with American’s equity investment in China Southern Airlines Company Limited (China Southern Airlines).
|
(9)
|
Income tax special items for 2018 included an $18 million charge related to an international income tax matter.
|
(10)
|
Impact of the 2017 Tax Act includes a $924 million non-cash charge to income tax expense to reflect the impact of lower corporate income tax rates on the Company’s deferred tax asset and liabilities resulting from the 2017 Tax Act, which reduced the federal corporate income tax rate from 35% to 21%.
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Secured
|
|
|
|
||||
2013 Credit Facilities, variable interest rate of 3.54%, installments through 2025 (a)
|
$
|
1,807
|
|
|
$
|
1,825
|
|
2014 Credit Facilities, variable interest rate of 3.72%, installments through 2021 (a)
|
1,202
|
|
|
1,215
|
|
||
April 2016 Credit Facilities, variable interest rate of 3.80%, installments through 2023 (a)
|
970
|
|
|
980
|
|
||
December 2016 Credit Facilities, variable interest rate of 3.74%, installments through 2023 (a)
|
1,213
|
|
|
1,225
|
|
||
Enhanced equipment trust certificates (EETCs), fixed interest rates ranging from 3.00% to 8.39%, averaging 4.05%, maturing from 2020 to 2032 (b)
|
11,933
|
|
|
11,648
|
|
||
Equipment loans and other notes payable, fixed and variable interest rates ranging from 2.99% to 7.31%, averaging 3.45%, maturing from 2020 to 2031 (c)
|
4,727
|
|
|
5,060
|
|
||
Special facility revenue bonds, fixed interest rates of 5.00%, maturing from 2020 to 2031
|
725
|
|
|
769
|
|
||
Total long-term debt
|
22,577
|
|
|
22,722
|
|
||
Less: Total unamortized debt discount, premium and issuance costs
|
205
|
|
|
219
|
|
||
Less: Current maturities
|
2,246
|
|
|
2,466
|
|
||
Long-term debt, net of current maturities
|
$
|
20,126
|
|
|
$
|
20,037
|
|
2013 Revolving Facility
|
$
|
750
|
|
2014 Revolving Facility
|
1,643
|
|
|
April 2016 Revolving Facility
|
450
|
|
|
Other Short-term Revolving Facility
|
400
|
|
|
Total
|
$
|
3,243
|
|
2020
|
$
|
2,293
|
|
2021
|
3,508
|
|
|
2022
|
1,551
|
|
|
2023
|
4,072
|
|
|
2024
|
1,521
|
|
|
2025 and thereafter
|
9,632
|
|
|
Total
|
$
|
22,577
|
|
|
2013 Credit Facilities
|
|
2014 Credit Facilities
|
|
April 2016 Credit Facilities
|
|
December 2016 Credit Facilities
|
||||||
|
2013 Replacement Term Loan
|
|
2013
Revolving Facility |
|
2014 Term
Loan |
|
2014
Revolving Facility |
|
April 2016
Term Loan |
|
April 2016
Revolving Facility |
|
December 2016 Term Loan
|
Aggregate principal issued
or credit facility availability
(in millions)
|
$1,919
|
|
$750
|
|
$1,250
|
|
$1,643
|
|
$1,000
|
|
$450
|
|
$1,250
|
Principal outstanding or
drawn (in millions)
|
$1,807
|
|
$—
|
|
$1,202
|
|
$—
|
|
$970
|
|
$—
|
|
$1,213
|
Maturity date
|
June 2025
|
|
October 2024
|
|
October 2021
|
|
October 2024
|
|
April 2023
|
|
October 2024
|
|
December 2023
|
LIBOR margin
|
1.75%
|
|
2.00%
|
|
2.00%
|
|
2.00%
|
|
2.00%
|
|
2.00%
|
|
2.00%
|
|
2019-1 Aircraft EETCs
|
||||
|
Series AA
|
|
Series A
|
|
Series B
|
Aggregate principal issued
|
$579 million
|
|
$289 million
|
|
$229 million
|
Remaining escrowed proceeds
|
$155 million
|
|
$77 million
|
|
$61 million
|
Fixed interest rate per annum
|
3.15%
|
|
3.50%
|
|
3.85%
|
Maturity date
|
February 2032
|
|
February 2032
|
|
February 2028
|
|
2013 Credit Facilities
|
|
2014 Credit Facilities
|
|
April 2016 Credit
Facilities
|
|
December 2016
Credit Facilities
|
Frequency of Appraisals of
Appraised Collateral
|
Annual
|
|
Annual
|
|
Annual
|
|
Annual
|
LTV Requirement
|
1.6x Collateral valuation to amount of debt outstanding (62.5% LTV)
|
|
1.6x Collateral valuation to amount of debt outstanding (62.5% LTV)
|
|
1.6x Collateral valuation to amount of debt outstanding (62.5% LTV)
|
|
1.6x Collateral valuation to amount of debt outstanding (62.5% LTV)
|
LTV as of Last Measurement
Date
|
36.2%
|
|
17.7%
|
|
36.2%
|
|
53.6%
|
Collateral Description
|
Generally, certain slots, route authorities and airport gate leasehold rights used by American to operate all services between the U.S. and South America
|
|
Generally, certain slots, route authorities and airport gate leasehold rights used by American to operate certain services between the U.S. and European Union (including London Heathrow)
|
|
Generally, certain spare parts
|
|
Generally, certain Ronald Reagan Washington National Airport (DCA) slots, certain La Guardia Airport (LGA) slots, certain simulators and certain leasehold rights
|
|
Year Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
Operating lease cost
|
$
|
2,012
|
|
|
$
|
1,889
|
|
Finance lease cost:
|
|
|
|
||||
Amortization of assets
|
79
|
|
|
78
|
|
||
Interest on lease liabilities
|
43
|
|
|
48
|
|
||
Variable lease cost
|
2,542
|
|
|
2,353
|
|
||
Total net lease cost
|
$
|
4,676
|
|
|
$
|
4,368
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Operating leases:
|
|
|
|
||||
Operating lease ROU assets
|
$
|
8,694
|
|
|
$
|
9,094
|
|
|
|
|
|
||||
Current operating lease liabilities
|
$
|
1,695
|
|
|
$
|
1,639
|
|
Noncurrent operating lease liabilities
|
7,388
|
|
|
7,857
|
|
||
Total operating lease liabilities
|
$
|
9,083
|
|
|
$
|
9,496
|
|
|
|
|
|
||||
Finance leases:
|
|
|
|
||||
Property and equipment, at cost
|
$
|
954
|
|
|
$
|
936
|
|
Accumulated amortization
|
(447
|
)
|
|
(391
|
)
|
||
Property and equipment, net
|
$
|
507
|
|
|
$
|
545
|
|
|
|
|
|
||||
Current finance lease liabilities
|
$
|
112
|
|
|
$
|
81
|
|
Noncurrent finance lease liabilities
|
558
|
|
|
613
|
|
||
Total finance lease liabilities
|
$
|
670
|
|
|
$
|
694
|
|
|
|
|
|
||||
Weighted average remaining lease term (in years):
|
|
|
|
||||
Operating leases
|
7.4
|
|
|
7.6
|
|
||
Finance leases
|
6.2
|
|
|
7.4
|
|
||
|
|
|
|
||||
Weighted average discount rate:
|
|
|
|
||||
Operating leases
|
4.7
|
%
|
|
4.6
|
%
|
||
Finance leases
|
6.2
|
%
|
|
6.5
|
%
|
|
Year Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
Cash paid for amounts included in the measurement of lease liabilities:
|
|
|
|
||||
Operating cash flows from operating leases
|
$
|
1,996
|
|
|
$
|
1,914
|
|
Operating cash flows from finance leases
|
43
|
|
|
48
|
|
||
Financing cash flows from finance leases
|
83
|
|
|
78
|
|
||
|
|
|
|
||||
Non-cash transactions:
|
|
|
|
||||
ROU assets acquired through operating leases
|
1,144
|
|
|
1,258
|
|
||
Operating lease conversion to finance lease
|
41
|
|
|
—
|
|
||
Property and equipment acquired through finance leases
|
20
|
|
|
—
|
|
||
|
|
|
|
||||
Gain on sale leaseback transactions, net
|
107
|
|
|
59
|
|
|
December 31, 2019
|
||||||
|
Operating Leases
|
|
Finance Leases
|
||||
2020
|
$
|
1,974
|
|
|
$
|
153
|
|
2021
|
1,804
|
|
|
128
|
|
||
2022
|
1,608
|
|
|
132
|
|
||
2023
|
1,423
|
|
|
110
|
|
||
2024
|
1,028
|
|
|
116
|
|
||
2025 and thereafter
|
3,268
|
|
|
171
|
|
||
Total lease payments
|
11,105
|
|
|
810
|
|
||
Less: Imputed interest
|
(2,022
|
)
|
|
(140
|
)
|
||
Total lease obligations
|
9,083
|
|
|
670
|
|
||
Less: Current obligations
|
(1,695
|
)
|
|
(112
|
)
|
||
Long-term lease obligations
|
$
|
7,388
|
|
|
$
|
558
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Current income tax provision:
|
|
|
|
|
|
||||||
State and Local
|
$
|
2
|
|
|
$
|
3
|
|
|
$
|
14
|
|
Foreign
|
8
|
|
|
28
|
|
|
10
|
|
|||
Current income tax provision
|
10
|
|
|
31
|
|
|
24
|
|
|||
Deferred income tax provision:
|
|
|
|
|
|
||||||
Federal
|
567
|
|
|
453
|
|
|
2,176
|
|
|||
State and Local
|
56
|
|
|
50
|
|
|
70
|
|
|||
Deferred income tax provision
|
623
|
|
|
503
|
|
|
2,246
|
|
|||
Total income tax provision
|
$
|
633
|
|
|
$
|
534
|
|
|
$
|
2,270
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Statutory income tax provision
|
$
|
547
|
|
|
$
|
460
|
|
|
$
|
1,244
|
|
State income tax provision, net of federal tax effect
|
41
|
|
|
46
|
|
|
53
|
|
|||
Book expenses not deductible for tax purposes
|
29
|
|
|
10
|
|
|
30
|
|
|||
Foreign income taxes, net of federal tax effect
|
8
|
|
|
22
|
|
|
6
|
|
|||
Change in valuation allowance
|
5
|
|
|
(6
|
)
|
|
4
|
|
|||
2017 Tax Act
|
—
|
|
|
—
|
|
|
924
|
|
|||
Other, net
|
3
|
|
|
2
|
|
|
9
|
|
|||
Income tax provision
|
$
|
633
|
|
|
$
|
534
|
|
|
$
|
2,270
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Deferred tax assets:
|
|
|
|
||||
Operating loss carryforwards
|
$
|
2,115
|
|
|
$
|
2,420
|
|
Leases
|
2,067
|
|
|
2,176
|
|
||
Loyalty program liability
|
1,755
|
|
|
1,770
|
|
||
Pensions
|
1,219
|
|
|
1,421
|
|
||
Postretirement benefits other than pensions
|
145
|
|
|
145
|
|
||
Rent expense
|
126
|
|
|
136
|
|
||
Alternative minimum tax (AMT) credit carryforwards
|
118
|
|
|
231
|
|
||
Reorganization items
|
30
|
|
|
33
|
|
||
Other
|
569
|
|
|
588
|
|
||
Total deferred tax assets
|
8,144
|
|
|
8,920
|
|
||
Valuation allowance
|
(24
|
)
|
|
(19
|
)
|
||
Net deferred tax assets
|
8,120
|
|
|
8,901
|
|
||
Deferred tax liabilities:
|
|
|
|
||||
Accelerated depreciation and amortization
|
(5,153
|
)
|
|
(5,243
|
)
|
||
Leases
|
(1,968
|
)
|
|
(2,068
|
)
|
||
Other
|
(340
|
)
|
|
(321
|
)
|
||
Total deferred tax liabilities
|
(7,461
|
)
|
|
(7,632
|
)
|
||
Net deferred tax asset
|
$
|
659
|
|
|
$
|
1,269
|
|
•
|
Level 1 – Observable inputs such as quoted prices in active markets;
|
•
|
Level 2 – Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and
|
•
|
Level 3 – Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.
|
|
Fair Value Measurements as of December 31, 2019
|
||||||||||||||
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
Short-term investments (1), (2):
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
331
|
|
|
$
|
331
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Bank notes/certificates of deposit/time deposits
|
2,106
|
|
|
—
|
|
|
2,106
|
|
|
—
|
|
||||
Corporate obligations
|
1,021
|
|
|
—
|
|
|
1,021
|
|
|
—
|
|
||||
Repurchase agreements
|
85
|
|
|
—
|
|
|
85
|
|
|
—
|
|
||||
|
3,543
|
|
|
331
|
|
|
3,212
|
|
|
—
|
|
||||
Restricted cash and short-term investments (1)
|
158
|
|
|
10
|
|
|
148
|
|
|
—
|
|
||||
Long-term investments (3)
|
204
|
|
|
204
|
|
|
—
|
|
|
—
|
|
||||
Total
|
$
|
3,905
|
|
|
$
|
545
|
|
|
$
|
3,360
|
|
|
$
|
—
|
|
|
Fair Value Measurements as of December 31, 2018
|
||||||||||||||
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
Short-term investments (1):
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
14
|
|
|
$
|
14
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Bank notes/certificates of deposit/time deposits
|
2,435
|
|
|
—
|
|
|
2,435
|
|
|
—
|
|
||||
Corporate obligations
|
1,658
|
|
|
—
|
|
|
1,658
|
|
|
—
|
|
||||
Repurchase agreements
|
375
|
|
|
—
|
|
|
375
|
|
|
—
|
|
||||
|
4,482
|
|
|
14
|
|
|
4,468
|
|
|
—
|
|
||||
Restricted cash and short-term investments (1)
|
154
|
|
|
12
|
|
|
142
|
|
|
—
|
|
||||
Long-term investments (3)
|
189
|
|
|
189
|
|
|
—
|
|
|
—
|
|
||||
Total
|
$
|
4,825
|
|
|
$
|
215
|
|
|
$
|
4,610
|
|
|
$
|
—
|
|
|
(1)
|
Unrealized gains and losses on short-term investments are recorded in accumulated other comprehensive loss at each measurement date.
|
(2)
|
All short-term investments are classified as available-for-sale and stated at fair value. American’s short-term investments as of December 31, 2019 mature in one year or less except for $1.1 billion of bank notes/certificates of deposit/time deposits and $95 million of corporate obligations.
|
(3)
|
Long-term investments primarily include American's equity investment in China Southern Airlines, in which American presently owns a 2.2% equity interest, and are classified in other assets on the consolidated balance sheets.
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||||
|
Carrying
Value
|
|
Fair
Value
|
|
Carrying
Value
|
|
Fair
Value
|
||||||||
Long-term debt, including current maturities
|
$
|
22,372
|
|
|
$
|
23,196
|
|
|
$
|
22,503
|
|
|
$
|
22,497
|
|
|
Pension Benefits
|
|
Retiree Medical and
Other Postretirement Benefits
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
(In millions)
|
||||||||||||||
Benefit obligation at beginning of period
|
$
|
16,282
|
|
|
$
|
18,175
|
|
|
$
|
837
|
|
|
$
|
1,010
|
|
Service cost
|
2
|
|
|
2
|
|
|
3
|
|
|
5
|
|
||||
Interest cost
|
699
|
|
|
670
|
|
|
33
|
|
|
35
|
|
||||
Actuarial (gain) loss (1), (2)
|
1,951
|
|
|
(1,905
|
)
|
|
20
|
|
|
(132
|
)
|
||||
Settlements
|
(2
|
)
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
||||
Benefit payments
|
(686
|
)
|
|
(659
|
)
|
|
(74
|
)
|
|
(81
|
)
|
||||
Other
|
—
|
|
|
3
|
|
|
5
|
|
|
—
|
|
||||
Benefit obligation at end of period
|
$
|
18,246
|
|
|
$
|
16,282
|
|
|
$
|
824
|
|
|
$
|
837
|
|
|
Pension Benefits
|
|
Retiree Medical and
Other Postretirement Benefits
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
(In millions)
|
||||||||||||||
Fair value of plan assets at beginning of period
|
$
|
10,001
|
|
|
$
|
11,340
|
|
|
$
|
225
|
|
|
$
|
295
|
|
Actual return (loss) on plan assets
|
2,292
|
|
|
(1,148
|
)
|
|
41
|
|
|
(24
|
)
|
||||
Employer contributions (3)
|
1,224
|
|
|
472
|
|
|
12
|
|
|
35
|
|
||||
Settlements
|
(2
|
)
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
||||
Benefit payments
|
(686
|
)
|
|
(659
|
)
|
|
(74
|
)
|
|
(81
|
)
|
||||
Fair value of plan assets at end of period
|
$
|
12,829
|
|
|
$
|
10,001
|
|
|
$
|
204
|
|
|
$
|
225
|
|
Funded status at end of period
|
$
|
(5,417
|
)
|
|
$
|
(6,281
|
)
|
|
$
|
(620
|
)
|
|
$
|
(612
|
)
|
|
(1)
|
The 2019 and 2018 pension actuarial (gain) loss primarily relates to changes in American’s weighted average discount rate and mortality assumption and, in 2018, changes to American’s retirement rate assumptions.
|
(2)
|
The 2019 retiree medical and other postretirement benefits actuarial loss primarily relates to changes in American’s weighted average discount rate assumption and plan experience adjustments.
|
(3)
|
During 2019, American contributed $1.2 billion to its defined benefit pension plans, including supplemental contributions of $444 million and a $780 million minimum required contribution. During 2018, American contributed $472 million to its defined benefit pension plans, including supplemental contributions of $433 million and a $39 million minimum required contribution.
|
|
Pension Benefits
|
|
Retiree Medical and
Other Postretirement Benefits
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
(In millions)
|
||||||||||||||
As of December 31,
|
|
||||||||||||||
Current liability
|
$
|
5
|
|
|
$
|
7
|
|
|
$
|
24
|
|
|
$
|
23
|
|
Noncurrent liability
|
5,412
|
|
|
6,274
|
|
|
596
|
|
|
589
|
|
||||
Total liabilities
|
$
|
5,417
|
|
|
$
|
6,281
|
|
|
$
|
620
|
|
|
$
|
612
|
|
Net actuarial loss (gain)
|
$
|
5,662
|
|
|
$
|
5,341
|
|
|
$
|
(426
|
)
|
|
$
|
(452
|
)
|
Prior service cost (benefit)
|
102
|
|
|
131
|
|
|
(120
|
)
|
|
(362
|
)
|
||||
Total accumulated other comprehensive loss (income), pre-tax
|
$
|
5,764
|
|
|
$
|
5,472
|
|
|
$
|
(546
|
)
|
|
$
|
(814
|
)
|
|
Pension Benefits
|
|
Retiree Medical and
Other Postretirement Benefits
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
(In millions)
|
||||||||||||||
Projected benefit obligation
|
$
|
18,215
|
|
|
$
|
16,254
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Accumulated benefit obligation (ABO)
|
18,204
|
|
|
16,246
|
|
|
—
|
|
|
—
|
|
||||
Accumulated postretirement benefit obligation
|
—
|
|
|
—
|
|
|
824
|
|
|
837
|
|
||||
Fair value of plan assets
|
12,794
|
|
|
9,971
|
|
|
204
|
|
|
225
|
|
||||
ABO less fair value of plan assets
|
5,410
|
|
|
6,275
|
|
|
—
|
|
|
—
|
|
|
Pension Benefits
|
|
Retiree Medical and
Other Postretirement Benefits
|
||||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|
2019
|
|
2018
|
|
2017
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
(In millions)
|
||||||||||||||||||||||
Defined benefit plans:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Service cost
|
$
|
2
|
|
|
$
|
2
|
|
|
$
|
2
|
|
|
$
|
3
|
|
|
$
|
5
|
|
|
$
|
4
|
|
Interest cost
|
699
|
|
|
670
|
|
|
717
|
|
|
33
|
|
|
35
|
|
|
39
|
|
||||||
Expected return on assets
|
(811
|
)
|
|
(901
|
)
|
|
(786
|
)
|
|
(15
|
)
|
|
(24
|
)
|
|
(21
|
)
|
||||||
Settlements
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Amortization of:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Prior service cost (benefit)
|
28
|
|
|
28
|
|
|
28
|
|
|
(236
|
)
|
|
(236
|
)
|
|
(237
|
)
|
||||||
Unrecognized net loss (gain)
|
150
|
|
|
140
|
|
|
144
|
|
|
(31
|
)
|
|
(21
|
)
|
|
(23
|
)
|
||||||
Net periodic benefit cost (income)
|
$
|
68
|
|
|
$
|
(61
|
)
|
|
$
|
106
|
|
|
$
|
(246
|
)
|
|
$
|
(241
|
)
|
|
$
|
(238
|
)
|
|
Pension Benefits
|
|
Retiree Medical and
Other Postretirement Benefits
|
||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Benefit obligations:
|
|
|
|
|
|
|
|
Weighted average discount rate
|
3.4%
|
|
4.4%
|
|
3.3%
|
|
4.3%
|
|
Pension Benefits
|
|
Retiree Medical and
Other Postretirement Benefits
|
||||||||
|
2019
|
|
2018
|
|
2017
|
|
2019
|
|
2018
|
|
2017
|
Net periodic benefit cost (income):
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average discount rate
|
4.4%
|
|
3.8%
|
|
4.3%
|
|
4.3%
|
|
3.6%
|
|
4.1%
|
Weighted average expected rate of return on plan assets
|
8.0%
|
|
8.0%
|
|
8.0%
|
|
8.0%
|
|
8.0%
|
|
8.0%
|
Weighted average health care cost trend rate assumed for next year (1)
|
N/A
|
|
N/A
|
|
N/A
|
|
3.7%
|
|
3.9%
|
|
4.2%
|
|
(1)
|
The weighted average health care cost trend rate at December 31, 2019 is assumed to decline gradually to 3.3% by 2027 and remain level thereafter.
|
|
1% Increase
|
|
1% Decrease
|
||||
Increase (decrease) on 2019 service and interest cost
|
$
|
1
|
|
|
$
|
(1
|
)
|
Increase (decrease) on benefit obligation as of December 31, 2019
|
40
|
|
|
(40
|
)
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
2024
|
|
2025-2029
|
||||||||||||
Pension benefits
|
$
|
749
|
|
|
$
|
788
|
|
|
$
|
827
|
|
|
$
|
869
|
|
|
$
|
910
|
|
|
$
|
5,017
|
|
Retiree medical and other postretirement benefits
|
80
|
|
|
71
|
|
|
66
|
|
|
64
|
|
|
61
|
|
|
265
|
|
Asset Class/Sub-Class
|
Allowed Range
|
Equity
|
45% - 80%
|
Public:
|
|
U.S. Large
|
15% - 40%
|
U.S. Small/Mid
|
2% - 10%
|
International
|
10% - 25%
|
Emerging Markets
|
2% - 15%
|
Alternative Investments
|
5% - 30%
|
Fixed Income
|
20% - 55%
|
Public:
|
|
U.S. Long Duration
|
15% - 45%
|
High Yield and Emerging Markets
|
0% - 10%
|
Private Income
|
0% - 10%
|
Other
|
0% - 5%
|
Cash Equivalents
|
0% - 20%
|
|
Fair Value Measurements as of December 31, 2019
|
||||||||||||||
Asset Category
|
Quoted Prices in
Active Markets
for Identical Assets
(Level 1)
|
|
Significant
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Total
|
||||||||
Cash and cash equivalents
|
$
|
20
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
20
|
|
Equity securities:
|
|
|
|
|
|
|
|
||||||||
International markets (a), (b)
|
2,769
|
|
|
—
|
|
|
—
|
|
|
2,769
|
|
||||
Large-cap companies (b)
|
2,312
|
|
|
—
|
|
|
—
|
|
|
2,312
|
|
||||
Mid-cap companies (b)
|
543
|
|
|
—
|
|
|
—
|
|
|
543
|
|
||||
Small-cap companies (b)
|
97
|
|
|
—
|
|
|
—
|
|
|
97
|
|
||||
Fixed income:
|
|
|
|
|
|
|
|
||||||||
Corporate debt (c)
|
—
|
|
|
2,804
|
|
|
—
|
|
|
2,804
|
|
||||
Government securities (d)
|
—
|
|
|
923
|
|
|
—
|
|
|
923
|
|
||||
U.S. municipal securities
|
—
|
|
|
51
|
|
|
—
|
|
|
51
|
|
||||
Mortgage backed securities
|
—
|
|
|
4
|
|
|
—
|
|
|
4
|
|
||||
Alternative instruments:
|
|
|
|
|
|
|
|
||||||||
Private market partnerships (e)
|
—
|
|
|
—
|
|
|
10
|
|
|
10
|
|
||||
Private market partnerships measured at net asset value (e), (f)
|
—
|
|
|
—
|
|
|
—
|
|
|
1,464
|
|
||||
Common/collective trusts (g)
|
—
|
|
|
358
|
|
|
—
|
|
|
358
|
|
||||
Common/collective trusts and 103-12 Investment Trust measured at net asset value (f), (g)
|
—
|
|
|
—
|
|
|
—
|
|
|
1,423
|
|
||||
Insurance group annuity contracts
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
||||
Dividend and interest receivable
|
53
|
|
|
—
|
|
|
—
|
|
|
53
|
|
||||
Due to/from brokers for sale of securities – net
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
||||
Total
|
$
|
5,790
|
|
|
$
|
4,140
|
|
|
$
|
12
|
|
|
$
|
12,829
|
|
|
(a)
|
Holdings are diversified as follows: 14% United Kingdom, 8% Switzerland, 8% Ireland, 7% Japan, 7% France, 6% South Korea, 6% Canada, 18% emerging markets and the remaining 26% with no concentration greater than 5% in any one country.
|
(b)
|
There are no significant concentrations of holdings by company or industry.
|
(c)
|
Includes approximately 76% investments in corporate debt with a S&P rating lower than A and 24% investments in corporate debt with a S&P rating A or higher. Holdings include 86% U.S. companies, 11% international companies and 3% emerging market companies.
|
(d)
|
Includes approximately 79% investments in U.S. domestic government securities, 13% in emerging market government securities and 8% in international government securities. There are no significant foreign currency risks within this classification.
|
(e)
|
Includes limited partnerships that invest primarily in domestic private equity and private income opportunities. The pension plan’s master trust does not have the right to redeem its limited partnership investment at its net asset value, but rather receives distributions as the underlying assets are liquidated. It is estimated that the underlying assets of these funds will be gradually liquidated over the next one to ten years. Additionally, the pension plan’s master trust has future funding commitments of approximately $1.4 billion over the next ten years.
|
(f)
|
Certain investments that are measured using net asset value per share (or its equivalent) as a practical expedient for fair value have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the notes to the consolidated financial statements.
|
(g)
|
Investment includes 36% in a common/collective trust investing in securities of larger companies within the U.S., 29% in a common/collective trust investing in securities of smaller companies located outside the U.S., 16% in a collective interest trust investing primarily in short-term securities, 15% in an emerging market 103-12 Investment Trust with investments in emerging country equity securities and 4% in Canadian segregated balanced value, income growth and diversified pooled funds. For some trusts, requests for withdrawals must meet specific requirements with advance notice of redemption preferred.
|
|
Fair Value Measurements as of December 31, 2018
|
||||||||||||||
Asset Category
|
Quoted Prices in
Active Markets
for Identical Assets
(Level 1)
|
|
Significant
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Total
|
||||||||
Cash and cash equivalents
|
$
|
23
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
23
|
|
Equity securities:
|
|
|
|
|
|
|
|
||||||||
International markets (a), (b)
|
3,181
|
|
|
—
|
|
|
—
|
|
|
3,181
|
|
||||
Large-cap companies (b)
|
2,021
|
|
|
—
|
|
|
—
|
|
|
2,021
|
|
||||
Mid-cap companies (b)
|
583
|
|
|
—
|
|
|
—
|
|
|
583
|
|
||||
Small-cap companies (b)
|
122
|
|
|
—
|
|
|
—
|
|
|
122
|
|
||||
Fixed income:
|
|
|
|
|
|
|
|
||||||||
Corporate debt (c)
|
—
|
|
|
2,116
|
|
|
—
|
|
|
2,116
|
|
||||
Government securities (d)
|
—
|
|
|
228
|
|
|
—
|
|
|
228
|
|
||||
U.S. municipal securities
|
—
|
|
|
40
|
|
|
—
|
|
|
40
|
|
||||
Alternative instruments:
|
|
|
|
|
|
|
|
||||||||
Private market partnerships (e)
|
—
|
|
|
—
|
|
|
7
|
|
|
7
|
|
||||
Private market partnerships measured at net asset value (e), (f)
|
—
|
|
|
—
|
|
|
—
|
|
|
1,188
|
|
||||
Common/collective trusts (g)
|
—
|
|
|
218
|
|
|
—
|
|
|
218
|
|
||||
Common/collective trusts and 103-12 Investment Trust measured at net asset value (f), (g)
|
—
|
|
|
—
|
|
|
—
|
|
|
227
|
|
||||
Insurance group annuity contracts
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
||||
Dividend and interest receivable
|
47
|
|
|
—
|
|
|
—
|
|
|
47
|
|
||||
Due to/from brokers for sale of securities – net
|
5
|
|
|
—
|
|
|
—
|
|
|
5
|
|
||||
Other liabilities – net
|
(7
|
)
|
|
—
|
|
|
—
|
|
|
(7
|
)
|
||||
Total
|
$
|
5,975
|
|
|
$
|
2,602
|
|
|
$
|
9
|
|
|
$
|
10,001
|
|
|
(a)
|
Holdings are diversified as follows: 17% United Kingdom, 10% Japan, 8% France, 7% Switzerland, 6% Ireland, 17% emerging markets and the remaining 35% with no concentration greater than 5% in any one country.
|
(b)
|
There are no significant concentrations of holdings by company or industry.
|
(c)
|
Includes approximately 77% investments in corporate debt with a S&P rating lower than A and 23% investments in corporate debt with a S&P rating A or higher. Holdings include 85% U.S. companies, 12% international companies and 3% emerging market companies.
|
(d)
|
Includes approximately 32% investments in U.S. domestic government securities, 37% in emerging market government securities and 31% in international government securities. There are no significant foreign currency risks within this classification.
|
(e)
|
Includes limited partnerships that invest primarily in U.S. (94%) and European (6%) buyout opportunities of a range of privately held companies. The pension plan’s master trust does not have the right to redeem its limited partnership investment at its net asset value, but rather receives distributions as the underlying assets are liquidated. It is estimated that the underlying assets of these funds will be gradually liquidated over the next one to ten years. Additionally, the pension plan’s master trust has future funding commitments of approximately $1.0 billion over the next ten years.
|
(f)
|
Certain investments that are measured using net asset value per share (or its equivalent) as a practical expedient for fair value have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the notes to the consolidated financial statements.
|
(g)
|
Investment includes 45% in an emerging market 103-12 Investment Trust with investments in emerging country equity securities, 37% in a collective interest trust investing primarily in short-term securities, 12% in Canadian segregated balanced value, income growth and diversified pooled funds and 6% in a common/collective trust investing in securities of smaller companies located outside the U.S., including developing markets. For some trusts, requests for withdrawals must meet specific requirements with advance notice of redemption preferred.
|
|
Private Market Partnerships
|
|
Insurance Group
Annuity Contracts
|
||||
Beginning balance at December 31, 2018
|
$
|
7
|
|
|
$
|
2
|
|
Purchases
|
3
|
|
|
—
|
|
||
Ending balance at December 31, 2019
|
$
|
10
|
|
|
$
|
2
|
|
|
Private Market
Partnerships
|
|
Insurance Group
Annuity Contracts
|
||||
Beginning balance at December 31, 2017
|
$
|
14
|
|
|
$
|
2
|
|
Actual loss on plan assets:
|
|
|
|
||||
Relating to assets still held at the reporting date
|
(2
|
)
|
|
—
|
|
||
Purchases
|
1
|
|
|
—
|
|
||
Sales
|
(6
|
)
|
|
—
|
|
||
Ending balance at December 31, 2018
|
$
|
7
|
|
|
$
|
2
|
|
|
Fair Value Measurements as of December 31, 2019
|
||||||||||||||
Asset Category
|
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
|
|
Significant
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Total
|
||||||||
Money market fund
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4
|
|
Mutual funds – AAL Class
|
—
|
|
|
200
|
|
|
—
|
|
|
200
|
|
||||
Total
|
$
|
4
|
|
|
$
|
200
|
|
|
$
|
—
|
|
|
$
|
204
|
|
|
Fair Value Measurements as of December 31, 2018
|
||||||||||||||
Asset Category
|
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
|
|
Significant
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Total
|
||||||||
Money market fund
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4
|
|
Mutual funds – AAL Class
|
—
|
|
|
221
|
|
|
—
|
|
|
221
|
|
||||
Total
|
$
|
4
|
|
|
$
|
221
|
|
|
$
|
—
|
|
|
$
|
225
|
|
|
Pension,
Retiree Medical and Other Postretirement Benefits |
|
Unrealized Gain (Loss) on Investments
|
|
Income Tax
Benefit (Provision) (1) |
|
Total
|
||||||||
Balance at December 31, 2017
|
$
|
(4,508
|
)
|
|
$
|
(1
|
)
|
|
$
|
(1,364
|
)
|
|
$
|
(5,873
|
)
|
Other comprehensive income (loss) before reclassifications
|
(61
|
)
|
|
(4
|
)
|
|
15
|
|
|
(50
|
)
|
||||
Amounts reclassified from AOCI
|
(89
|
)
|
|
—
|
|
|
20
|
|
(2)
|
(69
|
)
|
||||
Net current-period other comprehensive income (loss)
|
(150
|
)
|
|
(4
|
)
|
|
35
|
|
|
(119
|
)
|
||||
Balance at December 31, 2018
|
(4,658
|
)
|
|
(5
|
)
|
|
(1,329
|
)
|
|
(5,992
|
)
|
||||
Other comprehensive income (loss) before reclassifications
|
(471
|
)
|
|
3
|
|
|
106
|
|
|
(362
|
)
|
||||
Amounts reclassified from AOCI
|
(89
|
)
|
|
—
|
|
|
20
|
|
(2)
|
(69
|
)
|
||||
Net current-period other comprehensive income (loss)
|
(560
|
)
|
|
3
|
|
|
126
|
|
|
(431
|
)
|
||||
Balance at December 31, 2019
|
$
|
(5,218
|
)
|
|
$
|
(2
|
)
|
|
$
|
(1,203
|
)
|
|
$
|
(6,423
|
)
|
|
(1)
|
Relates principally to pension, retiree medical and other postretirement benefits obligations that will not be recognized in net income until the obligations are fully extinguished.
|
(2)
|
Relates to pension, retiree medical and other postretirement benefits obligations and is recognized within the income tax provision on American’s consolidated statements of operations.
|
|
Amounts reclassified from AOCI
|
|
Affected line items on the
consolidated statements of operations |
||||||
|
Year Ended December 31,
|
|
|||||||
AOCI Components
|
2019
|
|
2018
|
|
|||||
Amortization of pension, retiree medical and other postretirement benefits:
|
|
|
|
|
|
||||
Prior service benefit
|
$
|
(162
|
)
|
|
$
|
(161
|
)
|
|
Nonoperating other income, net
|
Actuarial loss
|
93
|
|
|
92
|
|
|
Nonoperating other income, net
|
||
Total reclassifications for the period, net of tax
|
$
|
(69
|
)
|
|
$
|
(69
|
)
|
|
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
2024
|
|
2025 and Thereafter
|
|
Total
|
||||||||||||||
Payments for aircraft commitments and certain engines (1)
|
$
|
1,629
|
|
|
$
|
750
|
|
|
$
|
1,599
|
|
|
$
|
1,543
|
|
|
$
|
2,574
|
|
|
$
|
4,855
|
|
|
$
|
12,950
|
|
|
(1)
|
These amounts are net of purchase deposits currently held by the manufacturers. American has granted a security interest in certain of its purchase deposits with Boeing. American’s purchase deposits held by all manufacturers totaled $1.7 billion as of December 31, 2019.
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
2024
|
|
2025 and Thereafter
|
|
Total
|
||||||||||||||
Minimum obligations under capacity purchase agreements with third-party regional carriers (1)
|
$
|
1,115
|
|
|
$
|
1,185
|
|
|
$
|
1,126
|
|
|
$
|
1,077
|
|
|
$
|
1,077
|
|
|
$
|
3,402
|
|
|
$
|
8,982
|
|
|
(1)
|
Represents minimum payments under capacity purchase agreements with third-party regional carriers, which are estimates of costs based on assumed minimum levels of flying under the capacity purchase agreements and American’s actual payments could differ materially. Excludes payments for the lease of certain aircraft under capacity purchase agreements, which are reflected in the operating lease obligations in Note 4.
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Non-cash investing and financing activities:
|
|
|
|
|
|
||||||
Settlement of bankruptcy obligations
|
$
|
7
|
|
|
$
|
—
|
|
|
$
|
15
|
|
Equity Investment
|
—
|
|
|
—
|
|
|
120
|
|
|||
Supplemental information:
|
|
|
|
|
|
||||||
Interest paid, net
|
1,025
|
|
|
1,009
|
|
|
942
|
|
|||
Income taxes paid
|
8
|
|
|
16
|
|
|
18
|
|
|
Number of Shares
|
|
Weighted Average Grant Date Fair Value
|
|||
|
(In thousands)
|
|
|
|||
Outstanding at December 31, 2016
|
5,187
|
|
|
$
|
41.48
|
|
Granted
|
2,309
|
|
|
48.58
|
|
|
Vested and released
|
(2,708
|
)
|
|
39.63
|
|
|
Forfeited
|
(464
|
)
|
|
44.48
|
|
|
Outstanding at December 31, 2017
|
4,324
|
|
|
$
|
46.94
|
|
Granted
|
2,194
|
|
|
47.65
|
|
|
Vested and released
|
(1,999
|
)
|
|
44.99
|
|
|
Forfeited
|
(199
|
)
|
|
45.72
|
|
|
Outstanding at December 31, 2018
|
4,320
|
|
|
$
|
44.29
|
|
Granted
|
3,206
|
|
|
34.00
|
|
|
Vested and released
|
(2,002
|
)
|
|
44.90
|
|
|
Forfeited
|
(337
|
)
|
|
42.55
|
|
|
Outstanding at December 31, 2019
|
5,187
|
|
|
$
|
37.01
|
|
|
Balance at Beginning of Year
|
|
Additions Charged to Statement of Operations Accounts
|
|
Deductions
|
|
Balance at
End of Year
|
||||||||
Allowance for obsolescence of spare parts
|
|
|
|
|
|
|
|
||||||||
Year ended December 31, 2019
|
$
|
754
|
|
|
$
|
79
|
|
|
$
|
(104
|
)
|
|
$
|
729
|
|
Year ended December 31, 2018
|
717
|
|
|
57
|
|
|
(20
|
)
|
|
754
|
|
||||
Year ended December 31, 2017
|
720
|
|
|
18
|
|
|
(21
|
)
|
|
717
|
|
||||
Allowance for uncollectible accounts
|
|
|
|
|
|
|
|
||||||||
Year ended December 31, 2019
|
$
|
24
|
|
|
$
|
17
|
|
|
$
|
(16
|
)
|
|
$
|
25
|
|
Year ended December 31, 2018
|
21
|
|
|
39
|
|
|
(36
|
)
|
|
24
|
|
||||
Year ended December 31, 2017
|
35
|
|
|
41
|
|
|
(55
|
)
|
|
21
|
|
|
First Quarter
|
|
Second Quarter
|
|
Third Quarter
|
|
Fourth Quarter
|
||||||||
2019
|
|
|
|
|
|
|
|
||||||||
Operating revenues
|
$
|
10,581
|
|
|
$
|
11,958
|
|
|
$
|
11,910
|
|
|
$
|
11,312
|
|
Operating expenses
|
10,236
|
|
|
10,831
|
|
|
11,082
|
|
|
10,565
|
|
||||
Operating income
|
345
|
|
|
1,127
|
|
|
828
|
|
|
747
|
|
||||
Net income
|
230
|
|
|
714
|
|
|
508
|
|
|
520
|
|
||||
|
|
|
|
|
|
|
|
||||||||
2018
|
|
|
|
|
|
|
|
||||||||
Operating revenues
|
$
|
10,398
|
|
|
$
|
11,640
|
|
|
$
|
11,556
|
|
|
$
|
10,936
|
|
Operating expenses
|
9,986
|
|
|
10,626
|
|
|
10,850
|
|
|
10,344
|
|
||||
Operating income
|
412
|
|
|
1,014
|
|
|
706
|
|
|
592
|
|
||||
Net income
|
209
|
|
|
609
|
|
|
433
|
|
|
407
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
AAG (1)
|
$
|
14,597
|
|
|
$
|
12,808
|
|
AAG’s wholly-owned subsidiaries (2)
|
(2,146
|
)
|
|
(2,142
|
)
|
||
Total
|
$
|
12,451
|
|
|
$
|
10,666
|
|
|
(1)
|
The increase in American’s net related party receivable from AAG is primarily due to American providing the cash funding for AAG’s share repurchase and dividend programs.
|
(2)
|
The net payable to AAG’s wholly-owned subsidiaries consists primarily of amounts due under regional capacity purchase agreements with AAG’s wholly-owned regional airlines operating under the brand name of American Eagle.
|
•
|
pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of AAG or American, respectively;
|
•
|
provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that receipts and expenditures of AAG or American are being made only in accordance with authorizations of management and directors of AAG or American, respectively; and
|
•
|
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of AAG’s or American’s assets that could have a material effect on the financial statements.
|
|
Page
|
|
Page
|
Exhibit
Number
|
Description
|
2.1
|
|
2.2
|
|
3.1
|
|
3.2
|
|
3.3
|
|
3.4
|
|
3.5
|
|
4.1
|
|
4.2
|
|
4.3
|
|
4.4
|
|
4.5
|
|
4.6
|
|
4.7
|
|
4.8
|
|
4.9
|
|
4.10
|
Exhibit
Number
|
Description
|
4.11
|
|
4.12
|
|
4.13
|
|
4.14
|
|
4.15
|
|
4.16
|
|
4.17
|
|
4.18
|
|
4.19
|
|
4.20
|
|
4.21
|
|
4.22
|
|
4.23
|
Exhibit
Number
|
Description
|
4.24
|
|
4.25
|
|
4.26
|
|
4.27
|
|
4.28
|
|
4.29
|
|
4.30
|
|
4.31
|
|
4.32
|
|
4.33
|
|
4.34
|
|
4.35
|
|
4.36
|
|
4.37
|
|
4.38
|
Exhibit
Number
|
Description
|
4.39
|
|
4.40
|
|
4.41
|
|
4.42
|
|
4.43
|
|
4.44
|
|
4.45
|
|
4.46
|
|
4.47
|
|
4.48
|
|
4.49
|
|
4.50
|
|
4.51
|
|
4.52
|
Exhibit
Number
|
Description
|
4.53
|
|
4.54
|
|
4.55
|
|
4.56
|
|
4.57
|
|
4.58
|
|
4.59
|
|
4.60
|
|
4.61
|
|
4.62
|
|
4.63
|
|
4.64
|
|
4.65
|
|
4.66
|
Exhibit
Number
|
Description
|
4.67
|
|
4.68
|
|
4.69
|
|
4.70
|
|
4.71
|
|
4.72
|
|
4.73
|
|
4.74
|
|
4.75
|
|
4.76
|
|
4.77
|
|
4.78
|
|
4.79
|
Exhibit
Number
|
Description
|
4.80
|
|
4.81
|
|
4.82
|
|
4.83
|
|
4.84
|
|
4.85
|
|
4.86
|
|
4.87
|
|
4.88
|
|
4.89
|
|
4.90
|
|
4.91
|
|
4.92
|
|
4.93
|
|
4.94
|
|
4.95
|
Exhibit
Number
|
Description
|
4.96
|
|
4.97
|
|
4.98
|
|
4.99
|
|
4.100
|
|
4.101
|
|
4.102
|
|
4.103
|
|
4.104
|
|
4.105
|
|
4.106
|
|
4.107
|
|
4.108
|
|
4.109
|
Exhibit
Number
|
Description
|
4.110
|
|
4.111
|
|
4.112
|
|
4.113
|
|
4.114
|
|
4.115
|
|
4.116
|
|
4.117
|
|
4.118
|
|
4.119
|
|
4.120
|
|
4.121
|
|
4.122
|
|
4.123
|
Exhibit
Number
|
Description
|
4.124
|
|
4.125
|
|
4.126
|
|
4.127
|
|
4.128
|
|
4.129
|
|
4.130
|
|
4.131
|
|
4.132
|
|
4.133
|
|
4.134
|
|
4.135
|
|
4.136
|
|
4.137
|
|
4.138
|
|
4.139
|
Exhibit
Number
|
Description
|
4.140
|
|
4.141
|
|
4.142
|
|
4.143
|
|
4.144
|
|
4.145
|
|
4.146
|
|
4.147
|
|
4.148
|
|
4.149
|
|
4.150
|
|
4.151
|
|
4.152
|
|
4.153
|
|
4.154
|
Exhibit
Number
|
Description
|
4.155
|
|
4.156
|
|
4.157
|
|
4.158
|
|
4.159
|
|
4.160
|
|
4.161
|
|
4.162
|
|
4.163
|
|
4.164
|
|
4.165
|
|
4.166
|
|
4.167
|
Exhibit
Number
|
Description
|
4.168
|
|
4.169
|
|
4.170
|
|
4.171
|
|
4.172
|
|
4.173
|
|
4.174
|
|
4.175
|
|
4.176
|
|
4.177
|
|
4.178
|
|
4.179
|
|
4.180
|
|
4.181
|
Exhibit
Number
|
Description
|
4.182
|
|
4.183
|
|
4.184
|
|
4.185
|
|
4.186
|
|
10.1
|
|
10.2
|
|
10.3
|
|
10.4
|
|
10.5
|
|
10.6
|
|
10.7
|
Exhibit
Number
|
Description
|
10.8
|
|
10.9
|
|
10.10
|
|
10.11
|
|
10.12
|
|
10.13
|
|
10.14
|
|
10.15
|
|
10.16
|
|
10.17
|
|
10.18
|
Exhibit
Number
|
Description
|
10.19
|
|
10.20
|
|
10.21
|
|
10.22
|
|
10.23
|
|
10.24
|
|
10.25
|
|
10.26
|
|
10.27
|
|
10.28
|
|
10.29
|
|
10.30
|
|
10.31
|
|
10.32
|
Exhibit
Number
|
Description
|
10.33
|
|
10.34
|
|
10.35
|
|
10.36
|
|
10.37
|
|
10.38
|
|
10.39
|
|
10.40
|
|
10.41
|
|
10.42
|
|
10.43
|
|
10.44
|
|
10.45
|
|
10.46
|
|
10.47
|
|
10.48
|
|
10.49
|
Exhibit
Number
|
Description
|
10.50
|
|
10.51
|
|
10.52
|
|
10.53
|
|
10.54
|
|
10.55
|
|
10.56
|
|
10.57
|
|
10.58
|
|
10.59
|
|
10.60
|
|
10.61
|
|
10.62
|
|
10.63
|
|
10.64
|
|
10.65
|
Exhibit
Number
|
Description
|
10.66
|
|
10.67
|
|
10.68
|
|
10.69
|
|
10.70
|
|
10.71
|
|
10.72
|
|
10.73
|
|
10.74
|
|
10.75
|
|
10.76
|
|
14.1
|
|
21.1
|
|
23.1
|
|
24.1
|
|
31.1
|
|
31.2
|
|
31.3
|
|
31.4
|
|
32.1
|
|
32.2
|
|
101.1
|
Interactive data files pursuant to Rule 405 of Regulation S-T, formatted in Inline XBRL (eXtensible Business
Reporting Language).
|
104.1
|
Cover page interactive data file (formatted in Inline XBRL and contained in Exhibit 101.1).
|
|
#
|
|
Pursuant to Item 601(b)(2) of Regulation S-K promulgated by the Securities and Exchange Commission, certain exhibits and schedules to this agreement have been omitted. Such exhibits and schedules are described in the referenced agreement. AAG and American hereby agree to furnish to the Securities and Exchange Commission, upon its request, any or all of such omitted exhibits or schedules.
|
|||
*
|
|
Confidential treatment has been granted with respect to certain portions of this agreement.
|
|||
**
|
|
Certain confidential information contained in this agreement has been omitted because it (i) is not material and (ii) would be competitively harmful if publicly disclosed.
|
|||
†
|
|
Management contract or compensatory plan or arrangement.
|
|
American Airlines Group Inc.
|
|
Date: February 19, 2020
|
By:
|
/s/ W. Douglas Parker
|
|
|
W. Douglas Parker
|
|
|
Chairman and Chief Executive Officer
|
|
|
(Principal Executive Officer)
|
|
American Airlines, Inc.
|
|
Date: February 19, 2020
|
By:
|
/s/ W. Douglas Parker
|
|
|
W. Douglas Parker
|
|
|
Chairman and Chief Executive Officer
|
|
|
(Principal Executive Officer)
|
Date: February 19, 2020
|
/s/ W. Douglas Parker
|
|
W. Douglas Parker
|
|
Chairman and Chief Executive Officer
|
|
(Principal Executive Officer)
|
|
|
Date: February 19, 2020
|
/s/ Derek J. Kerr
|
|
Derek J. Kerr
|
|
Executive Vice President and Chief Financial Officer
|
|
(Principal Financial and Accounting Officer)
|
|
|
Date: February 19, 2020
|
/s/ James F. Albaugh
|
|
James F. Albaugh, Director
|
|
|
Date: February 19, 2020
|
/s/ Jeffrey D. Benjamin
|
|
Jeffrey D. Benjamin, Director
|
|
|
Date: February 19, 2020
|
/s/ John T. Cahill
|
|
John T. Cahill, Director
|
|
|
Date: February 19, 2020
|
/s/ Michael J. Embler
|
|
Michael J. Embler, Director
|
|
|
Date: February 19, 2020
|
/s/ Matthew J. Hart
|
|
Matthew J. Hart, Director
|
|
|
Date: February 19, 2020
|
/s/ Susan D. Kronick
|
|
Susan D. Kronick, Director
|
|
|
Date: February 19, 2020
|
/s/ Martin H. Nesbitt
|
|
Martin H. Nesbitt, Director
|
|
|
Date: February 19, 2020
|
/s/ Denise M. O’Leary
|
|
Denise M. O’Leary, Director
|
|
|
Date: February 19, 2020
|
/s/ Ray M. Robinson
|
|
Ray M. Robinson, Director
|
Date: February 19, 2020
|
/s/ W. Douglas Parker
|
|
W. Douglas Parker
|
|
Chairman and Chief Executive Officer
|
|
(Principal Executive Officer)
|
|
|
Date: February 19, 2020
|
/s/ Derek J. Kerr
|
|
Derek J. Kerr
|
|
Executive Vice President and Chief Financial Officer
|
|
(Principal Financial and Accounting Officer)
|
|
|
Date: February 19, 2020
|
/s/ Stephen L. Johnson
|
|
Stephen L. Johnson, Director
|
|
|
Date: February 19, 2020
|
/s/ Robert D. Isom
|
|
Robert D. Isom, Director
|
•
|
1.75 billion shares of common stock, $0.01 par value; and
|
•
|
200 million shares of preferred stock, $0.01 par value.
|
•
|
the ability to authorize undesignated preferred stock with super voting, special approval, dividend, or other rights or preferences that could impede the success of any attempt to acquire AAG;
|
•
|
advance notice procedures for stockholder proposals to be considered at stockholders’ meetings;
|
•
|
the ability of AAG’s board of directors to fill vacancies on the board;
|
•
|
a prohibition against stockholders taking action by written consent;
|
•
|
a prohibition against stockholders calling a special meeting of stockholders, except by written demand, delivered in compliance with the requirements of the Bylaws, of stockholders holding at least 20% of the outstanding voting power of AAG’s shares;
|
•
|
certain restrictions on security ownership by persons who are not citizens of the U.S. (see the section entitled “-Other Provisions Restricting Transfer and Ownership” below);
|
•
|
certain restrictions on transfer of securities by persons or groups holding 4.75% or more of AAG’s capital stock or transfers resulting in a new person or group holding 4.75% or more of AAG’s capital stock (see the section entitled “-Other Provisions Restricting Transfer and Ownership” below);
|
•
|
requiring the approval of holders of at least 80% of the voting power of the shares entitled to vote in the election of directors to modify or amend the Bylaws; and
|
•
|
super-majority voting requirements to modify or amend specified provisions of the Certificate of Incorporation.
|
•
|
prior to this time, the board of directors of the corporation approved either the business combination or the transaction that resulted in such stockholder becoming an interested stockholder;
|
•
|
upon consummation of the transaction that resulted in such stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding shares owned by persons who are directors and also officers, and by employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or
|
•
|
at or subsequent to such time, the business combination is approved by the board of directors and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least 66 2/3% of the outstanding voting stock that is not owned by the interested stockholder.
|
•
|
any merger or consolidation involving the corporation and the interested stockholder;
|
•
|
any sale, transfer, pledge or other disposition of 10% or more of the assets of the corporation involving the interested stockholder;
|
•
|
any transaction that results in the issuance or transfer by the corporation of any stock of the corporation to the interested stockholder, subject to limited exceptions;
|
•
|
any transaction involving the corporation that has the effect of increasing the proportionate share of the stock of any class or series of the corporation beneficially owned by the interested stockholder; or
|
•
|
the receipt by the interested stockholder of the benefit of any loans, advances, guarantees, pledges or other financial benefits provided by or through the corporation.
|
Certain confidential information contained in this document, marked by brackets, has been omitted because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
|
Name of Bank
|
Seventh Amendment Extended Revolving Commitment
|
Sixth Amendment Non-Extended Revolving Commitment
|
LC Commitment
|
Citibank N.A.
|
[***]
|
[***]
|
$200,000,000
|
Bank of America, N.A.
|
[***]
|
[***]
|
|
Barclays Bank PLC
|
[***]
|
[***]
|
|
Credit Suisse AG, Cayman Islands Branch
|
[***]
|
[***]
|
|
Deutsche Bank AG New York Branch
|
[***]
|
[***]
|
|
Goldman Sachs Bank USA
|
[***]
|
[***]
|
|
Industrial and Commercial Bank of China Limited, New York Branch
|
[***]
|
[***]
|
|
JPMorgan Chase Bank, N.A.
|
[***]
|
[***]
|
|
Morgan Stanley Bank, N.A.
|
[***]
|
[***]
|
|
Morgan Stanley Senior Funding, Inc.
|
[***]
|
[***]
|
|
Sumitomo Mitsui Banking Corporation
|
[***]
|
[***]
|
|
BNP Paribas
|
[***]
|
[***]
|
|
Credit Agricole Corporate and Investment Bank
|
[***]
|
[***]
|
|
HSBC Bank USA, N.A.
|
[***]
|
[***]
|
|
MUFG Union Bank, N.A.
|
[***]
|
[***]
|
|
Standard Chartered Bank
|
[***]
|
[***]
|
|
U.S. Bank National Association
|
[***]
|
[***]
|
|
BOKF, NA dba Bank of Texas
|
[***]
|
[***]
|
|
Texas Capital Bank, N.A.
|
[***]
|
[***]
|
|
Total:
|
$1,630,500,000
|
$12,000,000
|
$200,000,000
|
Certain confidential information contained in this document, marked by brackets, has been omitted because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
|
Name of Bank
|
Sixth Amendment Extended Revolving Commitment
|
Fifth Amendment Non-Extended Revolving Commitment
|
LC Commitment
|
Deutsche Bank AG New York Branch
|
[***]
|
[***]
|
$100,000,000
|
Bank of America, N.A.
|
[***]
|
[***]
|
|
Barclays Bank PLC
|
[***]
|
[***]
|
|
Citibank N.A.
|
[***]
|
[***]
|
|
Credit Suisse AG, Cayman Islands Branch
|
[***]
|
[***]
|
|
Goldman Sachs Bank USA
|
[***]
|
[***]
|
|
Goldman Sachs Lending Partners LLC
|
[***]
|
[***]
|
|
Industrial and Commercial Bank of China Limited, New York Branch
|
[***]
|
[***]
|
|
JPMorgan Chase Bank, N.A.
|
[***]
|
[***]
|
|
Morgan Stanley Bank, N.A.
|
[***]
|
[***]
|
|
Morgan Stanley Senior Funding, Inc.
|
[***]
|
[***]
|
|
Sumitomo Mitsui Banking Corporation
|
[***]
|
[***]
|
|
BNP Paribas
|
[***]
|
[***]
|
|
Credit Agricole Corporate and Investment Bank
|
[***]
|
[***]
|
|
HSBC Bank USA, N.A.
|
[***]
|
[***]
|
|
MUFG Union Bank, N.A.
|
[***]
|
[***]
|
|
Standard Chartered Bank
|
[***]
|
[***]
|
|
U.S. Bank National Association
|
[***]
|
[***]
|
|
BOKF, NA dba Bank of Texas
|
[***]
|
[***]
|
|
Texas Capital Bank, N.A.
|
[***]
|
[***]
|
|
Total:
|
$735,600,000
|
$14,400,000
|
$100,000,000
|
Certain confidential information contained in this document, marked by brackets, has been omitted because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
|
Name of Bank
|
Fifth Amendment Extended Revolving Commitment
|
Fourth Amendment Non-Extended Revolving Commitment
|
LC Commitment
|
Barclays Bank PLC
|
[***]
|
[***]
|
|
Bank of America, N.A.
|
[***]
|
[***]
|
|
Citibank N.A.
|
[***]
|
[***]
|
|
Credit Suisse AG, Cayman Islands Branch
|
[***]
|
[***]
|
|
Deutsche Bank AG New York Branch
|
[***]
|
[***]
|
|
Goldman Sachs Bank USA
|
[***]
|
[***]
|
|
Industrial and Commercial Bank of China Limited, New York Branch
|
[***]
|
[***]
|
|
JPMorgan Chase Bank, N.A.
|
[***]
|
[***]
|
|
Morgan Stanley Bank, N.A.
|
[***]
|
[***]
|
|
Morgan Stanley Senior Funding, Inc.
|
[***]
|
[***]
|
|
Sumitomo Mitsui Banking Corporation
|
[***]
|
[***]
|
|
BNP Paribas
|
[***]
|
[***]
|
|
Credit Agricole Corporate and Investment Bank
|
[***]
|
[***]
|
|
HSBC Bank USA, N.A.
|
[***]
|
[***]
|
|
MUFG Union Bank, N.A.
|
[***]
|
[***]
|
|
Standard Chartered Bank
|
[***]
|
[***]
|
|
U.S. Bank National Association
|
[***]
|
[***]
|
|
BOKF, NA dba Bank of Texas
|
[***]
|
[***]
|
|
Texas Capital Bank, N.A.
|
[***]
|
[***]
|
|
Total:
|
$446,400,000
|
$3,600,000
|
$0
|
|
||
|
|
|
Name of Subsidiary
|
|
State or Sovereign Power of Incorporation
|
Subsidiaries included in the Registrant’s consolidated financial statements
|
|
|
AAG Private Placement-1 Parent LLC
|
|
Delaware
|
AAG Private Placement-1 LLC
|
|
Delaware
|
American Airlines, Inc.
|
|
Delaware
|
Aerosan Airport Services S.A.*
|
|
Chile
|
Aerosan S.A.*
|
|
Chile
|
American Airlines de Mexico, S.A.
|
|
Mexico
|
American Airlines Marketing Services LLC
|
|
Virginia
|
American Aviation Supply LLC
|
|
Delaware
|
American Airlines Retiree Travel LLC
|
|
Texas
|
oMC Venture, LLC*
|
|
Delaware
|
Texas Aero Engine Services, L.L.C.*
|
|
Delaware
|
Americas Ground Services, Inc.
|
|
Delaware
|
Dominicana de Servicios Aeroportuarios (DSA) S.R.L.
|
|
Dominican Republic
|
International Ground Services, S.A. de C.V.
|
|
Mexico
|
Avion Assurance, Ltd.
|
|
Bermuda
|
Envoy Aviation Group Inc.
|
|
Delaware
|
Eagle Aviation Services, Inc.
|
|
Delaware
|
Envoy Air Inc. (operates under the trade name “American Eagle”)
|
|
Delaware
|
Executive Airlines, Inc.
|
|
Delaware
|
FLAAG 2017-1 OPP LLC
|
|
Delaware
|
FLAAG 2017-1 OP-a LLC
|
|
Delaware
|
FLAAG 2017-1 OP-b LLC
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Delaware
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FLAAG 2019-1 OPP LLC
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Delaware
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FLAAG 2019-1 OP-a LLC
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Delaware
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FLAAG 2019-1 OP-b LLC
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Delaware
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FLAAG 2019-1 OP-c LLC
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Delaware
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J-CRJ900 LLC
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Delaware
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Piedmont Airlines, Inc. (operates under the trade name “American Eagle”)
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Maryland
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PMA Investment Subsidiary, Inc.
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Delaware
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PSA Airlines, Inc. (operates under the trade name “American Eagle”)
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Pennsylvania
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1.
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I have reviewed this Annual Report on Form 10-K of American Airlines Group Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/ W. Douglas Parker
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Name: W. Douglas Parker
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Title: Chief Executive Officer
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1.
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I have reviewed this Annual Report on Form 10-K of American Airlines Group Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/ Derek J. Kerr
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Name: Derek J. Kerr
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Title: Executive Vice President and
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Chief Financial Officer
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1.
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I have reviewed this Annual Report on Form 10-K of American Airlines, Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/ W. Douglas Parker
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Name: W. Douglas Parker
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Title: Chief Executive Officer
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1.
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I have reviewed this Annual Report on Form 10-K of American Airlines, Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/ Derek J. Kerr
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Name: Derek J. Kerr
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Title: Executive Vice President and
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Chief Financial Officer
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(1)
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The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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/s/ W. Douglas Parker
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Name: W. Douglas Parker
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Title: Chief Executive Officer
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Date: February 19, 2020
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/s/ Derek J. Kerr
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Name: Derek J. Kerr
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Title: Executive Vice President and Chief Financial Officer
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Date: February 19, 2020
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(1)
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The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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/s/ W. Douglas Parker
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Name: W. Douglas Parker
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Title: Chief Executive Officer
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Date: February 19, 2020
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/s/ Derek J. Kerr
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Name: Derek J. Kerr
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Title: Executive Vice President and Chief Financial Officer
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Date: February 19, 2020
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