Statement on Moody's Upgrade of AMR Debt Ratings
Moody's Investors Service said today that it raised the corporate debt ratings of AMR Corporation and its subsidiaries to B2. The following statement can be attributed to Thomas W. Horton, Executive Vice President of Finance and Planning and Chief Financial Officer of AMR Corporation:
"The upgrade by Moody's is recognition that we are continuing to make progress in strengthening our balance sheet and building a stronger financial foundation. We have more work to do but our success in growing revenue, cutting costs, building our cash balance, and reducing debt shows that we are on the right track."
AMR reported a net profit of $231 million in 2006, its first annual net profit since 2000.
The Company reduced total debt, which includes the principal amount of airport facility tax-exempt bonds and the present value of aircraft operating lease obligations, to $18.4 billion at the end of the fourth quarter of 2006, compared to $20.1 billion a year earlier.
AMR ended 2006 with $5.2 billion in cash and short-term investments, including a restricted balance of $468 million, compared to a balance of $4.3 billion in cash and short-term investments at the end of 2005, including a restricted balance of $510 million.
The Company also improved the funded status of employee pension plans to 84 percent at the end of 2006, compared to 77 percent funded at the end of 2005.
About American Airlines
American Airlines is the world's largest airline. American, American Eagle and the AmericanConnection® airlines serve 250 cities in over 40 countries with more than 4,000 daily flights. The combined network fleet numbers more than 1,000 aircraft. American's award-winning Web site, AA.com, provides users with easy access to check and book fares, plus personalized news, information and travel offers. American Airlines is a founding member of the oneworld® Alliance, which brings together some of the best and biggest names in the airline business, enabling them to offer their customers more services and benefits than any airline can provide on its own. Together, its members serve more than 600 destinations in over 135 countries and territories. American Airlines, Inc. and American Eagle Airlines, Inc. are subsidiaries of AMR Corporation. AmericanAirlines, American Eagle, the AmericanConnection® airlines, AA.com and AAdvantage are registered trademarks of American Airlines, Inc.
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