AMR Corp , parent of American Airlines, posted a wider-than-expected quarterly loss on Wednesday, saying the jump in fuel prices posed an obstacle to recovery, sending shares down as much as 5.5 percent.
The second-largest U.S. airline said the loss widened to $505 million, or $1.52 per share, from $375 million, or $1.35 per share, a year earlier.
Excluding a special item related to the devaluation of the Venezuelan currency in January, AMR lost $1.36 per share. On average, analysts had expected a loss of $1.31, according to Thomson Reuters I/B/E/S.
That disappointing result, which was driven by lingering weakness in the economy combined with rising fuel prices, underscores the reality that, despite a lot of hard work and progress, we remain regrettably far from our goal of sustained profitability, Chief Executive Gerard Arpey said in an employee memo.
AMR shares were down 30 cents or 3.5 percent at $8.26 at midday on the New York Stock Exchange, after falling as much as 5.5 percent earlier in the session. The Arca Airline index <.XAL> slipped nearly 2 percent.
The company posted operating revenue of $5.1 billion for the quarter, a 4.7 percent rise from a year earlier.
Arpey said the company would continue to focus on ways to boost its network, manage costs and drum up additional revenue.
AMR ended the quarter with $5 billion in cash, up sharply from the $3.3 billion in cash it had a year ago.
In a statement, the company said oil prices remained historically high and volatile. It said crude prices have jumped 20 percent since February.
AMR paid $211 million more for jet fuel in the first quarter, at $2.23 per gallon, than it paid a year ago. Fuel and labor are typically the top two costs for airlines.
In the first quarter, unit revenue rose 6.8 percent, helped by capacity and revenue management efforts. Passenger yields, or the average fares paid, rose 3.7 percent from a year earlier. Capacity fell 2.5 percent.
Earthquakes in Haiti and Chile and other bad weather cost the airline between $20 million and $25 million in the first quarter.
(Reporting by Deepa Seetharaman; Editing by Lisa Von Ahn and Matthew Lewis)