Unit revenue is on the rise at
, despite the airline industry's tough pricing environment.
In a filing with the
Securities and Exchange Commission
, AMR, which is the world's biggest airline, said mainline unit revenue, which excludes smaller, regional flights, will likely increase between 3.5% and 4.5% in the first quarter from a year earlier. Overall unit revenue, including regional flights, is expected to be up 2.9% to 3.9%.
Those increases would compare favorably with recent figures from the Air Transport Association, which tallies monthly unit revenue at the top eight U.S. carriers. The ATA said unit revenue was up 0.9% in January and down 1.6% in February.
Airline revenue has been under pressure as the industry continues to suffer from a glut of overcapacity and tough competition from low-cost carriers. A recent industrywide fare restructuring initiated by
Delta Air Lines
has had a negative impact on some airlines. At the same time, the industry is struggling with high fuel costs, although three rounds of fare increases in recent weeks have allowed carriers to pass some of those costs on to passengers.
AMR reiterated mainline unit cost guidance of 10.0 cents and consolidated guidance of 10.5 cents. Airlines measure unit costs in cost per available seat mile, or CASM. During the first quarter, AMR hedged 15% of its fuel consumption needs in the first quarter at a price of $40 a barrel, significantly below crude's recent levels around $55 a barrel.
The airline expects to end the first quarter with cash and short-term investments "well over" $3 billion, including $500 million in restricted cash and short-term investments.
AMR shares finished Tuesday's session up 20 cents, or 2.1%, at $9.93.