American Airlines, who is in the process of filing bankruptcy under Chapter 11 announced that it lost $234 million in January. Included in this loss was restructuring expenses of $155 million and $15 million to pay for financial advisors and bankruptcy attorneys. If it were only operations costs, the airline would’ve only lost $64 million.
The parent company AMR, filed this information on Wednesday with the U.S. Bankruptcy Court in New York. Other information filed with the bankruptcy court showed revenue of close to $2.03 billion. The reported expenses for the ailing airline were $601 million for wages and $704 million for fuel costs. In their filing, AMR didn’t give past figures to use for comparison’s sake.
American airlines entered into the bankruptcy filing November 29, 2011 with the intent of restructuring its debt. According to bankruptcy documents, the airline plans on cutting 13,000 jobs and would like to turn its pension obligations over to the federal government. Also the Chapter 11 reorganization plan includes a pay reduction in benefits for any remaining workers.
It seems that AMR definitely doesn’t have a cash flow problem as it ended January with $4.9 billion in cash and investments. AMR has been sitting on a pile of cash to the tune of $4 billion since filing bankruptcy in November. Even though they’re sitting on a pile of cash, the bankrupt airline reported a $1.1 billion loss for the fourth quarter of 2011 because of devaluing its planes and other assets. If American Airlines didn’t include their write-downs, there are losses would have shown it to under $9 million compared to a loss of one year ago at $69 million.