American Airlines’ (AAL - Free Report) second-quarter 2019 earnings (excluding 33 cents from non-recurring items) of $1.82 per share surpassed the Zacks Consensus Estimate by 5 cents. Moreover, the bottom line increased on a year-over-year basis. Revenues totaled $11,960 million, which were in line with the Zacks Consensus Estimate. However, the top line improved 2.7% on a year-over-year basis. Passenger revenues, which accounted for bulk of the top line (92.1%), increased 3.2%.
Total revenue per available seat miles (TRASM: a key measure of unit revenues) increased 3.5% to 16.54 cents in the reported quarter. Passenger revenue per available seat miles (PRASM) increased 4% to 15.22 cents in the second quarter. Consolidated yield increased 0.1%.
While traffic (measured by revenue passenger miles) was up 3.1%, capacity (measured by average seat miles) contracted 0.8%. Consolidated load factor (percentage of seats filled by passengers) expanded 320 basis points to 86.6% as traffic growth outpaced capacity expansion.
Total operating expenses (on a reported basis) increased 1.6% year over year to $10,807 million due to 3.4% increase in expenses pertaining to salaries, wages and benefits. Consolidated operating costs per available seat miles (CASM: excluding fuel and special items) increased 4.8% to 11.34 cents. The increase was due to lower-than-expected capacity following the prolonged grounding of Boeing 737 MAX jets and operational disruptions. Average fuel cost per gallon (on a consolidated basis: including taxes) declined 4.4% to $2.14.
Furthermore, the carrier declared a dividend of 10 cents per share. The dividend will be paid on May 22 to the shareholders of record on May 8.