OREANDA-NEWS. American Airlines Group Inc. (NASDAQ: AAL) today reported its third quarter 2014 results.

Third quarter 2014 net profit, excluding net special charges, was a record USD 1.2 billion, up 59 percent versus the third quarter 2013

Third quarter 2014 GAAP net profit was USD 942 million, a record for any quarter in the history of American Airlines

Returned USD 185 million to shareholders through the payment of USD 72 million in quarterly dividends and the repurchase of USD 113 million of common stock through the Company's stock repurchase program

Declared a dividend of USD 0.10 per share to be paid on November 17, 2014 to shareholders of record as of November 3, 2014

For the third quarter 2014, American Airlines Group reported a record GAAP net profit of USD 942 million. This compares to a GAAP net profit of USD 289 million in the third quarter 2013 for AMR Corporation prior to the merger.

The Company believes it is more meaningful to compare year-over-year results for American Airlines and US Airways excluding special charges and on a combined basis, which is a non-GAAP formulation that combines the results for AMR Corporation and US Airways Group. On this basis, third quarter 2014 net profit excluding net special charges was a record USD 1.2 billion, or USD 1.66 per diluted share. This represents a 59 percent improvement over the combined non-GAAP net profit of USD 771 million excluding net special charges for the same period in 2013. The Company's third quarter 2014 pretax margin excluding net special charges was 11 percent. See the accompanying notes in the Financial Tables section of this press release for further explanation of this presentation, including a reconciliation of GAAP to non-GAAP financial information.

"We are very pleased to have reported a record profit for each quarter so far in 2014," said Chairman and CEO Doug Parker. "We anticipate we will also post a record profit for both the fourth quarter and full year 2014. This performance reflects the strength of our merger and the commitment of our team. Our over 100,000 team members are doing an excellent job of integrating our airlines and providing outstanding service to our customers. While some of the biggest tasks in our integration still lie before us, the significant accomplishments to date reinforce our confidence that we are well on our way to restoring American as the world's greatest airline. Thanks to our team, American is in excellent position for success in 2015 and beyond."

Revenue and Cost Comparisons

Total revenues in the third quarter were a record USD 11.1 billion, an increase of 4.4 percent versus the third quarter 2013 on a combined basis, on a 2.0 percent increase in total available seat miles (ASMs). Consolidated passenger revenue per ASM (PRASM) was a record at 14.12 cents, up 1.0 percent versus the third quarter 2013 on a combined basis, driven by a record yield of 16.93 cents, up 2.6 percent year-over-year.

Total operating expenses in the third quarter were USD 9.9 billion, an increase of 3.5 percent over combined third quarter 2013. Third quarter mainline cost per available seat mile (CASM) was 13.28 cents, up 1.3 percent on a 2.1 percent increase in mainline ASMs versus combined third quarter 2013. Excluding special charges and fuel, mainline CASM was up 0.7 percent compared to the combined third quarter 2013, at 8.35 cents. Regional CASM excluding special charges and fuel was 15.52 cents, up 3.7 percent on a 1.0 percent increase in regional ASMs versus combined third quarter 2013.

Liquidity and Financing Transactions

At September 30, 2014, American had approximately USD 8.8 billion in total cash and short-term investments, of which USD 875 million was restricted. The Company also had an undrawn revolving credit facility of USD 1.0 billion.

During the third quarter, the Company Issued USD 957 million principal amount of 2014-1 Enhanced Equipment Trust Certificates (EETC) at a blended interest rate of 3.8 percent and issued USD 750 million principal amount of 5.5 percent senior unsecured notes due in 2019.

Also in the third quarter, the Company returned USD 185 million to its shareholders through the payment of USD 72 million in quarterly dividends and the repurchase of USD 113 million of common stock, or 2.9 million shares. The Company also purchased approximately 432,000 shares from its Disputed Claims Reserve at the prevailing market price to satisfy certain tax obligations resulting from the July 1, 2014, distribution.

As of September 30, 2014, USD 721 million of the Company's unrestricted cash balance was held in Venezuelan bolivars, valued at the weighted average applicable exchange rate of 6.41 bolivars to the dollar. The Company's cash balance held in Venezuelan bolivars decreased USD 70 million from the June 30, 2014, balance of USD 791 million, due primarily to USD 48 million in repatriations in the third quarter of 2014 (USD 31 million valued at 6.3 bolivars to the dollar and USD 17 million valued at 10.6 bolivars to the dollar). This balance also reflects the Company's significant reduction in capacity in this market, pending further repatriation of funds and due to a decrease in demand for air travel resulting from the effective devaluation of the bolivar. The Company continues to work with Venezuelan authorities regarding the timing and exchange rate applicable to the repatriation of funds held in local currency. The Company is monitoring this situation closely and continues to evaluate its holdings of Venezuelan bolivars for potential impairment.

In early October, the Company arranged a new credit facility consisting of a fully-drawn USD 750 million term loan that matures in October 2021 and an undrawn USD 400 million revolving credit facility that matures in October 2019. Collateral for the new credit facility consists of certain slots, gates and route authorities. Also in early October, the Company increased its existing USD 1 billion revolving credit facility by USD 400 million and extended its maturity date from June 2018 to October 2019. As a result of these transactions, the Company's undrawn revolving credit facility is now USD 1.8 billion.

On October 22, the Company's Board of Directors declared a dividend of USD 0.10 per share for shareholders of record as of November 3, 2014. The dividend will be paid on November 17, 2014.