Total operating revenues rose 5.4% to $11.56 billion helped by strong demand for air travel. The improvement in revenue was offset by the significant increase in fuel prices.
The company returned $46 million in dividends to shareholders and declared a dividend of $0.10 per share on October 25, 2018, to be paid on November 20, 2018, to stockholders of record as of November 6, 2018.
American Airlines lowered planned capital expenditures in 2019, 2020, and 2021 by $1.2 billion, by deferring delivery of 22 Airbus A321neos.
Looking ahead into the fourth quarter, American Airlines expects its TRASM to increase about 1.5% to 3.5% year-over-year. Pre-tax margin excluding special items is predicted to be between 4.5% and 6.5%. Based on the guidance, American Airlines continues to expect its 2018 diluted EPS excluding net special items to be between $4.50 and $5.00.
American Airlines said it is continuing the installation of Premium Economy, now on 92 widebody aircraft with expected completion by mid-2019. Main Cabin customers continue to select this highly-differentiated product and the company expects to drive more value from this product with new revenue management and merchandising initiatives in 2019.
For the third quarter, passenger revenue per available seat mile (PRASM) grew 1.8% driven by an increase in passenger yields. Cargo revenue was up 16.4% due to an increase in yield and a rise in volume. Other revenue was up 14.5% due primarily to higher loyalty revenue. Total revenue per available seat mile (TRASM) increased by 2.6% on an increase in total available seat miles.
Shares of American Airlines ended Wednesday’s regular session down 6.30% at $30.34 on the Nasdaq. The stock has fallen over 41% each in the past year and in the year so far.