We have already written about the reporting of companies that have managed not to lose, but to make money at a time of pandemics. Unfortunately, the largest US airline American Airlines Group Inc. is not among them. The company’s financial statements for the first quarter of 2020, has demonstrated how strongly the sharp drop in demand for air travel affects the state of affairs of the aviation giant.
From a press release issued by American Airlines simultaneously with the report, it became known that the net loss for the first quarter of the year had amounted to $ 2.241 billion ($ 5.26 per share). A year ago, the company came out on top with a profit of $ 185 million ($ 0.41 per share). The last time the company suffered such heavy losses in 2008 crisis.
Analysts had no doubt that the company would record a serious quarterly loss. But the reporting showed that the consensus forecast for losses from analysts was more optimistic than reality.
The revenue of the American air carrier has fallen to 8.515 billion US dollars, i.e. by 19.6%. For the same period last year, the company managed to raise $ 10.584 billion. And here the consensus forecast was better than the real figures. Analysts believed that the revenue would be at least $ 9.255 billion.
American Airlines CEO Doug Parker said the airline had never faced such serious problems. Mr. Parker had to work hard to cut costs and maintain the liquidity of the company entrusted to him.
Due to poor reporting, the shares of the air carrier lost 4.6% immediately after the publication. The company’s capitalization has fallen by 58% since the beginning of the year. The S&P 500 index has fallen 10% over the same period.
The material was prepared with the participation of Katya Wilson,
a leading analyst of the brokerage company UFT Group