American Airlines Group Inc. said Friday that its passenger
traffic edged down 0.6% in March, as the carrier also said it
incurred higher-than-expected foreign-exchange losses in its first
quarter.
As a result of a strengthening dollar, American Airlines lowered
the top end of its pretax-margin forecast by one percentage point,
now calling for a margin of 12% to 13%. Meanwhile, the carrier
lowered its fuel-cost guidance for the quarter by a penny and
forecast a smaller-than-anticipated decline in a key revenue
metric.
For the month of March, the world's largest airline by traffic
said capacity fell 0.9%, while the portion of seats filled--or load
factor--rose by 0.3 percentage point to 82.1%.
For the first quarter, the Fort Worth, Texas, company said it
now expects its unit revenue--the amount of passenger revenue
produced for each seat flown a mile--to be down 1% to 3%, compared
to its previous estimate for a decline of between 2% and 4%.
The company expects average fuel costs of $1.80 to $1.85 a
gallon, compared with its February view for $1.81 to $1.86 a
gallon.
American merged with US Airways in December 2013 to become the
world's largest airline by traffic after the old American parent
emerged from bankruptcy protection. Soon after, American shed its
fuel-hedging positions to come into alignment with US Airways'
no-hedging philosophy.
This has given American an advantage over some of its large
competitors whose hedges cost them money when fuel prices
collapsed.
Write to Chelsey Dulaney at Chelsey.Dulaney@wsj.com and Tess
Stynes at tess.stynes@wsj.com